The regulation of network infrastructure beyond the Washington consensus

Abstract

The provision of public services involving network infrastructure must inevitably address the challenge posed by their inherent monopolies. However, much of current regulatory theory is founded on an additional paradigm in which private enterprise was expected to play a growing part in the delivery of such services. As a consequence, the theory was expanded in the 1980s to create the conditions to facilitate the entry of the private sector, reflecting the then-dominant policy framework described as 'the Washington Consensus'. Because much of South Africa's policy framework was established while this was the dominant global policy discourse, its perspectives were embedded in local regulatory approaches. However, while private-sector involvement is desirable in some circumstances, it is not inevitably the optimal strategy to meet public policy objectives. The new consensus is that formulaic prescriptions for regulatory approaches based on ideological approaches are not helpful. The institutions and instruments must be developed to meet specific public policy objectives, appropriate to the particular circumstances rather than simply left to reflect the inertia of historical path dependence. © 2012 Development Bank of Southern Africa.