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Regulatory Benchmarking with Panel Data

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    Abstract

    This paper considers panel data procedures for regulatory benchmarking that allow for both latent heterogeneity and inefficiency, encapsulating the regulatory dilemma in comparative efficiency analysis for incentive regulation. It applies a distance function model with appropriate concavity properties for econometric estimation to a panel of electricity distribution utilities in Turkey, since electricity industry reform is a major policy issue there. The results confirm the importance of allowing simultaneously for heterogeneity and inefficiency and emphasise the need for specific time-invariant heterogeneity information, such as geographical data, on regulated utilities in different regions.

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    File URL: http://www.lboro.ac.uk/departments/ec/RePEc/lbo/lbowps/WJBA_wp2007_03.pdf
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    Bibliographic Info

    Paper provided by Department of Economics, Loughborough University in its series Discussion Paper Series with number 2007_03.

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    Date of creation: Jan 2007
    Date of revision: Jan 2007
    Handle: RePEc:lbo:lbowps:2007_03

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    Keywords: efficiency and productivity analysis; regulation; electricity distribution.;

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    Cited by:
    1. Massimo Filippini & Lin Zhang, 2013. "Measurement of the “Underlying energy efficiency” in Chinese provinces," CER-ETH Economics working paper series 13/183, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.

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