Institutional reform and natural gas deregulation in Mexico

Abstract

With a simple case study of the natural gas reform in Mexico, this paper studies the effect of political institutions on the type and direction of public policies, in particular on regulatory policies of public energy services. The study uses the theory of political actors with veto power which suggests that two factors should be taken into account to measure the degree of regulatory certainty from political institutions: regulatory pre-dictability and regime stability to which the former belongs. This paper concludes that the performance evaluation of the Mexican energy sector should include the effect of political institutions.