Vertical and horizontal scope economies in the regulated US electricity power industry

Pablo Arocena, David S. Saal, Tim Coelli

Research output: Contribution to journalArticle

Abstract

This paper investigates vertical economies between generation and distribution of electric power, and horizontal economies between different types of power generation in the U.S. electric utility industry. Our quadratic cost function model includes three generation output measures (hydro, nuclear and fossil fuels), which allows us to analyze the effect that generation mix has on vertical economies. Our results provide (sample mean) estimates of vertical economies of 8.1% and horizontal economies of 5.4%. An extensive sensitivity analysis is used to show how the scope measures vary across alternative model specifications and firm types.
Original languageEnglish
Pages (from-to)434-467
Number of pages34
JournalJournal of Industrial Economics
Volume60
Issue number3
DOIs
Publication statusPublished - Sep 2012

Fingerprint

Industry
Electricity
Scope economies
Alternative models
Electric power
Power generation
Model specification
Fossil fuels
Cost function
Sensitivity analysis
Electric utilities

Cite this

Arocena, Pablo ; Saal, David S. ; Coelli, Tim. / Vertical and horizontal scope economies in the regulated US electricity power industry. In: Journal of Industrial Economics. 2012 ; Vol. 60, No. 3. pp. 434-467.
@article{6564a98c94dc42ccb1261c8807bc8fb6,
title = "Vertical and horizontal scope economies in the regulated US electricity power industry",
abstract = "This paper investigates vertical economies between generation and distribution of electric power, and horizontal economies between different types of power generation in the U.S. electric utility industry. Our quadratic cost function model includes three generation output measures (hydro, nuclear and fossil fuels), which allows us to analyze the effect that generation mix has on vertical economies. Our results provide (sample mean) estimates of vertical economies of 8.1{\%} and horizontal economies of 5.4{\%}. An extensive sensitivity analysis is used to show how the scope measures vary across alternative model specifications and firm types.",
author = "Pablo Arocena and Saal, {David S.} and Tim Coelli",
year = "2012",
month = "9",
doi = "10.1111/j.1467-6451.2012.00486.x",
language = "English",
volume = "60",
pages = "434--467",
journal = "Journal of Industrial Economics",
issn = "0022-1821",
publisher = "Wiley-Blackwell",
number = "3",

}

Vertical and horizontal scope economies in the regulated US electricity power industry. / Arocena, Pablo; Saal, David S.; Coelli, Tim.

In: Journal of Industrial Economics, Vol. 60, No. 3, 09.2012, p. 434-467.

Research output: Contribution to journalArticle

TY - JOUR

T1 - Vertical and horizontal scope economies in the regulated US electricity power industry

AU - Arocena, Pablo

AU - Saal, David S.

AU - Coelli, Tim

PY - 2012/9

Y1 - 2012/9

N2 - This paper investigates vertical economies between generation and distribution of electric power, and horizontal economies between different types of power generation in the U.S. electric utility industry. Our quadratic cost function model includes three generation output measures (hydro, nuclear and fossil fuels), which allows us to analyze the effect that generation mix has on vertical economies. Our results provide (sample mean) estimates of vertical economies of 8.1% and horizontal economies of 5.4%. An extensive sensitivity analysis is used to show how the scope measures vary across alternative model specifications and firm types.

AB - This paper investigates vertical economies between generation and distribution of electric power, and horizontal economies between different types of power generation in the U.S. electric utility industry. Our quadratic cost function model includes three generation output measures (hydro, nuclear and fossil fuels), which allows us to analyze the effect that generation mix has on vertical economies. Our results provide (sample mean) estimates of vertical economies of 8.1% and horizontal economies of 5.4%. An extensive sensitivity analysis is used to show how the scope measures vary across alternative model specifications and firm types.

UR - http://www.scopus.com/inward/record.url?scp=84867666347&partnerID=8YFLogxK

UR - http://onlinelibrary.wiley.com/doi/10.1111/j.1467-6451.2012.00486.x/abstract

U2 - 10.1111/j.1467-6451.2012.00486.x

DO - 10.1111/j.1467-6451.2012.00486.x

M3 - Article

AN - SCOPUS:84867666347

VL - 60

SP - 434

EP - 467

JO - Journal of Industrial Economics

JF - Journal of Industrial Economics

SN - 0022-1821

IS - 3

ER -