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The effect of restructuring electricity distribution systems on firms’ persistent and transient efficiency: The case of Germany
journal contribution
posted on 2019-10-24, 10:57 authored by Oleg Badunenko, Astrid Cullmann, Subal Kumbhakar, Maria NieswandWe evaluate the efficiency of electricity distribution operators (DSOs) as providers of local public infrastructure. In particular, we consider two types of efficiency, i.e., short-term (transient) and long-term (persistent). We apply the recently developed four-component stochastic frontier model, which allows identifying determinants of the two types of efficiency, after controlling for firm heterogeneity and random noise, to a panel dataset of German DSOs observed during 2006-2012. Those DSOs operating in the eastern parts of Germany have undergone a profound restructuring after the reunification in 1990. We find that this was beneficial for their efficiency as they perform, on average, better in terms of persistent efficiency than DSOs in West Germany. Both eastern and western DSOs perform similarly well in terms of transient efficiency, which is expected as the sector is highly regulated. As such, we provide new insights on identifying the nature and sources of public infrastructure productive inefficiency, which is relevant for public policies.
Funding
Leibniz Association
History
School
- Business and Economics
Department
- Economics
Published in
The Energy JournalVolume
42Issue
4Publisher
International Association for Energy EconomicsVersion
- AM (Accepted Manuscript)
Rights holder
© The AuthorsPublisher statement
This article first appeared in The Energy Journal, Vol. 42, No. 4, 2021, DOI: https://doi.org/10.5547/01956574.42.4.obad - Reproduced by permission of the International Association for Energy Economics (IAEE).Acceptance date
2019-10-14Publication date
2021-07-31Copyright date
2021ISSN
0195-6574eISSN
1944-9089Publisher version
Language
- en
Depositor
Dr Maria Nieswand. Deposit date: 22 October 2019Usage metrics
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