Incentive Regulatory policies: The Case of Public Transit Systems in France
This paper is aimed at assessing the empirical relevance of the new theory of regulation. It relies on a principal-agent framework for studying the regulatory schemes used in the French urban transport industry. Taking the current regulatory schemes as given, the model of supply and demand provides estimates for the firms' inefficiency, the effort of managers, and the cost of public funds. It allows deriving the first-best and second-best regulatory policies for each network and comparing them with the actual situation in terms of welfare loss or gain. Fixed-price policies are lying between fully informed and uninformed second best schemes. Cost-plus contracts are dominated by any type of second-best contract. From these results, we may conjecture that fixed prices contracts call for better informed regulators.
|Date of creation:||2002|
|Date of revision:|
|Publication status:||Published, RAND Journal of Economics, 2002, 33, 605-629|
|Note:||View the original document on HAL open archive server: http://hal.archives-ouvertes.fr/hal-00622846/en/|
|Contact details of provider:|| Web page: http://hal.archives-ouvertes.fr/|
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.:
- 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.
- Magnus, J.R., 1982. "Multivariate error components analysis of linear and nonlinear regression models by maximum likelihood," Other publications TiSEM 9ffb33fe-f5af-470f-b405-f, Tilburg University, School of Economics and Management.
- Cornwell, C. & Schmidt, P., 1993. "Production Frontiers and Efficiency Measurement," Papers 427e, Georgia - College of Business Administration, Department of Economics.
- Philippe Gagnepain & Marc Ivaldi, 2002.
"Stochastic Frontiers and Asymmetric Information Models,"
Journal of Productivity Analysis,
Springer, vol. 18(2), pages 145-159, September.
- Gagnepain, P. & Ivaldi, M., 1998. "Stochastic Frontiers and Asymmetric Information Models," Papers 98.503, Toulouse - GREMAQ.
- Philippe Gagnepain & Marc Ivaldi, 2002. "Stochastic Frontiers and Asymmetric Information Models," Post-Print hal-00622849, HAL.
- Loeb, Martin & Magat, Wesley A, 1979. "A Decentralized Method for Utility Regulation," Journal of Law and Economics, University of Chicago Press, vol. 22(2), pages 399-404, October.
- Bernard Caillaud & Patrick Rey & Roger Guesnerie & Jean Tirole, 1987.
"Government Intervention in Production and Incentives Theory: A Review of Recent Contributions,"
472, Massachusetts Institute of Technology (MIT), Department of Economics.
- B. Caillaud & R. Guesnerie & P. Rey & J. Tirole, 1988. "Government Intervention in Production and Incentives Theory: A Review of Recent Contributions," RAND Journal of Economics, The RAND Corporation, vol. 19(1), pages 1-26, Spring.
- Jean-Jacques Laffont & Jean Tirole, 1993. "A Theory of Incentives in Procurement and Regulation," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262121743, June.
- Jondrow, James & Knox Lovell, C. A. & Materov, Ivan S. & Schmidt, Peter, 1982. "On the estimation of technical inefficiency in the stochastic frontier production function model," Journal of Econometrics, Elsevier, vol. 19(2-3), pages 233-238, August.
- Harry F. Campbell, 1975. "Deadweight Loss and Commodity Taxation in Canada," Canadian Journal of Economics, Canadian Economics Association, vol. 8(3), pages 441-47, August.
- Cornwell, Christopher & Schmidt, Peter & Sickles, Robin C., 1989.
"Production Frontiers With Cross-Sectinal And Time-Series Variation In Efficiency Levels,"
89-18, C.V. Starr Center for Applied Economics, New York University.
- Cornwell, Christopher & Schmidt, Peter & Sickles, Robin C., 1990. "Production frontiers with cross-sectional and time-series variation in efficiency levels," Journal of Econometrics, Elsevier, vol. 46(1-2), pages 185-200.
- Tracy R. Lewis & David E.M. Sappington, 1989. "Regulatory Options and Price-Cap Regulation," RAND Journal of Economics, The RAND Corporation, vol. 20(3), pages 405-416, Autumn.
- Magnus, Jan R., 1982. "Multivariate error components analysis of linear and nonlinear regression models by maximum likelihood," Journal of Econometrics, Elsevier, vol. 19(2-3), pages 239-285, August.
- Gasmi, F & Laffont, Jean-Jacques & Sharkey, W W, 1997. "Incentive Regulation and the Cost Structure of the Local Telephone Exchange Network," Journal of Regulatory Economics, Springer, vol. 12(1), pages 5-25, July.
- Laffont, Jean-Jacques, 1996. "Industrial policy and politics," International Journal of Industrial Organization, Elsevier, vol. 14(1), pages 1-27.
- Alan D. Mathios & Robert P. Rogers, 1989. "The Impact of Alternative Forms of State Regulation of AT&T on Direct-Dial, Long-Distance Telephone Rates," RAND Journal of Economics, The RAND Corporation, vol. 20(3), pages 437-453, Autumn.
- Vuong, Quang H, 1989. "Likelihood Ratio Tests for Model Selection and Non-nested Hypotheses," Econometrica, Econometric Society, vol. 57(2), pages 307-33, March.
- Frank A. WOLAK, 1994. "An Econometric Analysis of the Asymmetric Information, Regulator-Utility Interaction," Annales d'Economie et de Statistique, ENSAE, issue 34, pages 13-69.
- Dag Morten Dalen & Andres Gomez Lobo, 1996. "Regulation and incentive contracts: An empirical investigation of the Norwegian bus transport industry," IFS Working Papers W96/08, Institute for Fiscal Studies.
When requesting a correction, please mention this item's handle: RePEc:hal:journl:hal-00622846. 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: (CCSD)
If references are entirely missing, you can add them using this form.