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Efficiency and productivity analysis in regulation and governance

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posted on 30.03.2007, 11:18 by Tom Weyman-Jones
This paper surveys the application of efficiency and productivity analysis to recent regulatory experience, especially in Europe. From a review of regulatory case studies, particularly of network industries, it is clear that regulatory practice differs from theoretical precedent in choice of methodology, sample size, model specification and price or revenue control implementation. A principal-agent model of linear regulatory contracts is used to understand this discrepancy, suggesting that efficiency and productivity analysis has been used to capture economic rent rather than to provide incentives for efficiency. Predictions of the model are used to investigate other assumptions in efficiency and productivity analysis.

History

School

  • Business and Economics

Department

  • Economics

Pages

271845 bytes

Publication date

2007

Notes

This is a working paper. It is also available at: http://ideas.repec.org/p/lbo/lbowps/2007_02.html.

ISSN

1750-4171

Language

en