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Lost economies of scope and potential merger gains in the Norwegian electricity industry

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  • Ørjan Mydland

    (Inland Norway University of Applied Sciences)

Abstract

In 2016, the Norwegian Parliament amended the Energy Act, with changes taking effect from 2021. The amended legislation will introduce strict separation of all generation and distribution companies within the electricity industry in Norway. Economies of scope studies from Norway show evidence of large economies of scope. Further, the companies in the industry could utilize the economies of scale potential if they merged. In this paper, we perform merger analysis to investigate potential merger gains in the Norwegian electricity distribution industry. By providing a method of testing for optimal mergers, we can present the best merger combination to the Norwegian electricity industry.

Suggested Citation

  • Ørjan Mydland, 2020. "Lost economies of scope and potential merger gains in the Norwegian electricity industry," Empirical Economics, Springer, vol. 58(6), pages 3077-3100, June.
    • Handle: RePEc:spr:empeco:v:58:y:2020:i:6:d:10.1007_s00181-018-01620-1
    DOI: 10.1007/s00181-018-01620-1
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    References listed on IDEAS

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    Cited by:

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    2. Musau, Andrew & Kumbhakar, Subal C. & Mydland, Ørjan & Lien, Gudbrand, 2021. "Determinants of allocative and technical inefficiency in stochastic frontier models: An analysis of Norwegian electricity distribution firms," European Journal of Operational Research, Elsevier, vol. 288(3), pages 983-991.
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    4. Chang, Tsung-Sheng & Lin, Ji-Gang & Ouenniche, Jamal, 2023. "DEA-based Nash bargaining approach to merger target selection," European Journal of Operational Research, Elsevier, vol. 305(2), pages 930-945.

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