The impact of productive efficiency and quality of a regulated local public utility on final goods prices and consumers welfare
AbstractIn this paper, we reconstruct the process by which the decisions of a regulated local public utility, in terms of productive efficiency and quality of the service provided, impact on prices of final consumption goods, supplied in a oligopolistic market operating in the same geographic area. We obtain some formula for these effects which can be quantified by estimating firms’ conditional input demand function of the public service and firms’ inverse demand function for this public good, non-rival, component. Finally, we draw the effects of productive efficiency and quality on consumer welfare and cost-of-living, via changes on tariffs, external effects and final goods prices.
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Bibliographic InfoPaper provided by Universita' degli Studi di Firenze, Dipartimento di Scienze dell'Economia e Dell'Impresa in its series Working Papers Series with number wp2008_10.rdf.
Length: 33 pag
Date of creation: 2008
Date of revision:
regulation; x-efficiency; oligopoly; consumer welfare;
Find related papers by JEL classification:
- L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
- D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
- D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-10-21 (All new papers)
- NEP-EFF-2008-10-21 (Efficiency & Productivity)
- NEP-MIC-2008-10-21 (Microeconomics)
- NEP-PBE-2008-10-21 (Public Economics)
- NEP-REG-2008-10-21 (Regulation)
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