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Regulation of the electricity sector in Russia: regional aspects (in Russian)

Author

Listed:
  • Galina Yudashkina

    (Novosibirsk University of Consumer Cooperation, Russia)

  • Sergey Pobochy

    (International Association of Regional Energy Commissions, Russia)

Abstract

We evaluate the influence of interests of regional energy companies, consumers and governors on electricity regulation policy in Russian regions. We use panel data on electricity tariffs and electricity consumption in 77 regions during 1998-2003. We find evidence that governors tended to "freeze" the tariffs during governor elections, and that energy-intensive enterprises prefer buying electricity at the federal wholesale market to bargaining over lower tariffs with regional regulators. We conclude that regulation in 1998-2003 was socially oriented rather than was protecting interests of industrial consumers. However, an observed tendency of elimination of cross-subsidization is an evidence of reduction in social functions of electricity. Taking into consideration a high poverty level of population it is necessary to reconsider the norms of setting marginal tariffs so as to separate social and economic parameters of regulation.

Suggested Citation

  • Galina Yudashkina & Sergey Pobochy, 2007. "Regulation of the electricity sector in Russia: regional aspects (in Russian)," Quantile, Quantile, issue 2, pages 107-130, March.
  • Handle: RePEc:qnt:quantl:y:2007:i:2:p:107-130
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    References listed on IDEAS

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    1. George J. Stigler, 1971. "The Theory of Economic Regulation," Bell Journal of Economics, The RAND Corporation, vol. 2(1), pages 3-21, Spring.
    2. Peltzman, Sam, 1987. "Economic Conditions and Gubernatorial Elections," American Economic Review, American Economic Association, vol. 77(2), pages 293-297, May.
    3. Faulhaber, Gerald R, 1975. "Cross-Subsidization: Pricing in Public Enterprises," American Economic Review, American Economic Association, vol. 65(5), pages 966-977, December.
    4. Rensman, Marieke & Kuper, Gerard H., 1999. "The role of R&D and patent activity in economic growth: some empirical evidence," Research Report 99C03, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    5. David Martimort, 1999. "The Life Cycle of Regulatory Agencies: Dynamic Capture and Transaction Costs," Review of Economic Studies, Oxford University Press, vol. 66(4), pages 929-947.
    6. Hausman, Jerry, 2015. "Specification tests in econometrics," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 38(2), pages 112-134.
    7. Richard A. Posner, 1974. "Theories of Economic Regulation," Bell Journal of Economics, The RAND Corporation, vol. 5(2), pages 335-358, Autumn.
    8. William D. Nordhaus, 1975. "The Political Business Cycle," Review of Economic Studies, Oxford University Press, vol. 42(2), pages 169-190.
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    More about this item

    Keywords

    Russia; electricity sector; regulation; interest-group theory; governors; panel data;

    JEL classification:

    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation

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