Institutional determinants of power sector reform in Pakistan

The electricity supply sector in Pakistan has performed poorly in recent years. Reforms were introduced in the mid-1990s to improve the sector, but progressed slowly with no significant impacts on pre-reform performance. This study uses new institutional economics as a theoretical basis to elucidate reasons for the failure of power sector reforms in Pakistan to make improvements. Interviews with 23 experts using Q-methodology generated 215 statements that were used as a Q concourse. Of these, 51 statements were selected for the Q sample and ranked by 34 respondents depending on their importance. Analysis revealed four important discourses on the determinants of power sector reform failure in Pakistan. These included weak governance structure, country and sectoral endowments, inefficient regulator and unspecified political institutions or unfriendly political contexts. The study recommends establishment of institutions that support a market based power supply sector and improvements to the contractual arrangements between stakeholders to reduce opportunistic behaviour.