C. Richard Baker
University of Massachusetts Dartmouth
Abstract: The bankruptcy of Enron Corp. has resulted in a scandal of enormous proportions involving allegations of fraud, corruption and unethical practices on the part Enron executives, members of its board of directors, and its external auditors. The focus of this paper is on the relationships between Enron's business model and the deregulatory phase of the American economy during the 1980s and 1990s. It is the argument of this paper that deregulation in the US electric power and natural gas industries fostered the creation of the Enron business model, and that this model was unsustainable, resulting in the demise of Enron Corp. In addition, while Enron can be viewed as an example of unregulated free market excess, the paper reveals how the Enron business model developed as an American form of a public private partnership, similar to the types of public private partnerships that have been created in recent years in the United Kingdom. Investigating Enron as a public private partnership may help us to better understand the role of public private partnerships and shed some light on the advisability of deregulation and the unintended consequences that can result from deregulation.
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