A Political Settlement Analysis of the Differential Outcomes of the Electricity and Telecommunications Sector Privatisations in Nigeria (2000-2021)

This paper uses a political economy lens, specifically political settlement, to examine the causes of implementation failures and enforcement gaps in the structural reforms that took place in the Nigerian electricity and telecommunications sectors between 2000 and 2021. The political settlement framework analyses the distribution of organisational power in relation to formal and informal institutions. This helps us understand why poor development outcomes occur in developing countries. My findings reveal that the divergence between formal and informal rules and the behaviour of actors given their power, capabilities and interests creates implementation and enforcement gaps that lead to poor social outcomes. There is an important linkage between policy design, capabilities, and the configuration of the political settlement. The ability to adapt and refine policy design and to reallocate learning rent away from non-performing actors depends on the available policy space within the political settlement configuration (Khan,2015). The political settlement shapes development outcomes, and policy design with this contextual lens increases the likelihood of a net social benefit. The comparative analysis of the electricity and telecommunications sector helps interrogate the dynamic relationship between rules and actors' behaviour, which is influenced by their power, capabilities, and interests. Unlike in the telecommunications sector where a net social benefit was realised the interactions between rules and actors' behaviour in the electricity sector led to enforcement and implementation gaps and consequently policy failure.