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The selection of public utility commissioners: A re-examination of the importance of institutional setting

  • William Boyes
  • John McDowell

The result of a great many studies is that it makes no difference to the rate level whether the public utility commission is appointed or elected. Nevertheless, the typical response to an inquiry regarding the effect of appointment versus election is that a difference in resulting rate structure should exist. In this paper we have reconciled these views and more carefully examined the issue of whether institutional setting does matter in the setting of regulated electricity prices. We suggest that one should not necessarily expect elected PUCs to behave differently than appointed ones. Instead different behavior should be expected from PUCs that are ‘closer’ to their constituents than those more isolated, irrespective of whether the PUC is elected or appointed. The results of an empirical examination based on a large sample of utilities operating during the period of 1981-83 support this view. The more narrowly defined is the consumer voter-group, everything else the same, the lower is the rate set by the PUC. Copyright Kluwer Academic Publishers 1989

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File URL: http://hdl.handle.net/10.1007/BF00116759
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Article provided by Springer in its journal Public Choice.

Volume (Year): 61 (1989)
Issue (Month): 1 (April)
Pages: 1-13

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Handle: RePEc:kap:pubcho:v:61:y:1989:i:1:p:1-13
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  1. Smiley, Robert H. & Greene, William H., 1983. "Determinants of the effectiveness of electric utility regulation," Resources and Energy, Elsevier, vol. 5(1), pages 65-81, March.
  2. Peter Navarro, 1982. "Public Utility Commission Regulation: Performance, Determinants, and Energy Policy Impacts," The Energy Journal, International Association for Energy Economics, vol. 0(Number 2), pages 119-140.
  3. Walter Primeaux & Patrick Mann, 1985. "Voter power and electricity prices," Public Choice, Springer, vol. 47(3), pages 519-525, January.
  4. Robert L. Hagerman & Brian T. Ratchford, 1978. "Some Determinants of Allowed Rates of Return on Equity to Electric Utilities," Bell Journal of Economics, The RAND Corporation, vol. 9(1), pages 46-55, Spring.
  5. Ryan Amacher & William Boyes, 1978. "Cycles in senatorial voting behavior: implications for the optimal frequency of elections," Public Choice, Springer, vol. 33(3), pages 5-13, January.
  6. George J. Stigler, 1971. "The Theory of Economic Regulation," Bell Journal of Economics, The RAND Corporation, vol. 2(1), pages 3-21, Spring.
  7. Jarrell, Gregg A, 1978. "The Demand for State Regulation of the Electric Utility Industry," Journal of Law and Economics, University of Chicago Press, vol. 21(2), pages 269-95, October.
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