Regulation of Public Utilities under Asymmetric Information
We consider the relationship between a localcommunity and a private operator in charge ofthe water utility. An important feature of themodel is the possibility of water networklosses that are costly to the operator. Wecompute the first-best and asymmetricinformation solutions to the optimal contract,with private information on the operator'stechnology. Based on an econometric estimationof production cost and water demand for a panelof French local communities, we simulate theoptimal contract solutions and show thatasymmetric information has importantconsequences for the regulation of water publicutilities. Copyright Kluwer Academic Publishers 2003
Volume (Year): 26 (2003)
Issue (Month): 1 (September)
|Contact details of provider:|| Web page: http://www.springerlink.com/link.asp?id=100263|
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.:
- Crain, W Mark & Zardkoohi, Asghar, 1978. "A Test of the Property-Rights Theory of the Firm: Water Utilities in the United States," Journal of Law and Economics, University of Chicago Press, vol. 21(2), pages 395-408, October.
- Laffont, Jean-Jacques & Tirole, Jean, 1986.
"Using Cost Observation to Regulate Firms,"
Journal of Political Economy,
University of Chicago Press, vol. 94(3), pages 614-41, June.
- Serge Garcia & Alban Thomas, 2001. "The Structure of Municipal Water Supply Costs: Application to a Panel of French Local Communities," Journal of Productivity Analysis, Springer, vol. 16(1), pages 5-29, July.
- Renzetti, Steven, 1992. "Evaluating the welfare effects of reforming municipal water prices," Journal of Environmental Economics and Management, Elsevier, vol. 22(2), pages 147-163, March.
- Thomas Alban, 1995. "Regulating Pollution under Asymmetric Information: The Case of Industrial Wastewater Treatment," Journal of Environmental Economics and Management, Elsevier, vol. 28(3), pages 357-373, May.
- Arnaud Reynaud & Céline Nauges, 2001.
"Estimation de la demande domestique d'eau potable en France,"
Programme National Persée, vol. 52(1), pages 167-185.
- Céline Nauges & Arnaud Reynaud, 2001. "Estimation de la demande domestique d'eau potable en France," Revue économique, Presses de Sciences-Po, vol. 52(1), pages 167-185.
- Steven Renzetti, 1992. "Estimating the Structure of Industrial Water Demands: The Case of Canadian Manufacturing," Land Economics, University of Wisconsin Press, vol. 68(4), pages 396-404.
- McFadden, Daniel & Ruud, Paul A, 1994. "Estimation by Simulation," The Review of Economics and Statistics, MIT Press, vol. 76(4), pages 591-608, November.
When requesting a correction, please mention this item's handle: RePEc:kap:enreec:v:26:y:2003:i:1:p:145-162. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guenther Eichhorn)or (Christopher F. Baum)
If references are entirely missing, you can add them using this form.