This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

Bigger and Better: A Dynamic Regulatory Mechanism for Optimum Quality

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
De Fraja, Gianni
Iozzi, Alberto

Additional information is available for the following registered author(s):

Abstract

Vogelsang and Finsinger’s seminal paper (Bell Journal of Economics, 1979) proposes a mechanism for price regulation with some desirable properties, such as convergence to a second best optimum. This mechanism applies to situations where quality is fixed: in practice, quality can be varied by the firm, and regulators have typically imposed constraints on the firm’s quality choice. This Paper lays a rigorous theoretical foundation to the inclusion of quality measures in the constraints faced by a regulated firm. We identify a potential pitfall in the approach taken in practice by regulators, and show that, in order to avoid it, the regulated firm should be subject to an additional constraint, which, loosely speaking, requires firms’ choices not to be too erratic.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.cepr.org/pubs/dps/DP4502.asp
File Format: application/pdf
File Function:
Download Restriction: CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Publisher Info
Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 4502.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length:
Date of creation: Aug 2004
Date of revision:
Handle: RePEc:cpr:ceprdp:4502

Contact details of provider:
Postal: Centre for Economic Policy Research, 53--56 Great Sutton Street, London EC1V 0DG
Phone: 44 - 20 - 7183 8801
Fax: 44 - 20 - 7183 8820

Order Information:
Email:

For technical questions regarding this item, or to correct its listing, contact: ().

Related research
Keywords: price cap; quality; regulation; RPI-X;

This paper has been announced in the following NEP Reports:

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)
  1. Kevin Currier, 2006. "Quality-Adjusted Laspeyres Price Caps: A Graphical Analysis," Atlantic Economic Journal, International Atlantic Economic Society, vol. 34(4), pages 481-490, December. [Downloadable!] (restricted)
  2. Auray, Stéphane & Mariotti, Thomas & Moizeau, Fabien, 2006. "Dynamic Regulation of Quality," IDEI Working Papers 397, Institut d'Économie Industrielle (IDEI), Toulouse. [Downloadable!]
    Other versions:
  3. Bergantino, Angela Stefania & De Villemeur, Étienne & Vinella, Annalisa, 2007. "Partial Regulation in Vertically Differentiated Industries," IDEI Working Papers 502, Institut d'Économie Industrielle (IDEI), Toulouse, revised Jun 2009. [Downloadable!]
  4. David Sappington, 2005. "Regulating Service Quality: A Survey," Journal of Regulatory Economics, Springer, vol. 27(2), pages 123-154, November. [Downloadable!] (restricted)
  5. Luigi Benfratello & Alberto Iozzi & Paola Valbonesi, 2005. "Privatisation, regulation and productivity in the Italian motorway industry," "Marco Fanno" Working Papers 0002, Dipartimento di Scienze Economiche "Marco Fanno". [Downloadable!]
  6. Stéphane Auray & Thomas Mariotti & Fabien Moizeau, 2006. "Dynamic Regulation of Public Good Quality," Cahiers de recherche 0610, CIRPEE. [Downloadable!]
  7. Angela S. Bergantino & Etienne Billette de Villemeur & Annalisa Vinella, 2006. "A Model of Partial Regulation in the Maritime Ferry Industry," series 0010, Dipartimento di Scienze Economiche - Università di Bari, revised Feb 2006. [Downloadable!]
  8. De Villemeur, Étienne & Gui, Benedetto, 2007. "Regulation of a Monopoly Generating Externalities," IDEI Working Papers 469, Institut d'Économie Industrielle (IDEI), Toulouse. [Downloadable!]
Statistics
Access and download statistics

Did you know? About 1000 archives contribute their bibliographic data to RePEc.

This page was last updated on 2009-11-25.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.