This model of an electric utility views the regulator as setting price with the firm choosing ex ante capital and labor inputs and responding to ex post demand with its fuel input and the services of the ex ante inputs. If the firm anticipates that its choice of capital stock will influence the...

Book review

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The purpose of this paper is to formulate the implications of finance theory for rate of return regulation. A variety of problems in finance and the law and economics of regulation are reviewed. Also, a regulatory procedure based on finance theory is proposed for practical use.

In their recent article, Elizabeth Bailey and John Malone deduce the optimal capital-labor ratios for firms with four different management objectives (maximum profit, return on investment, sales, and output), given that these firms are subject to four types of regulatory constraint (profit no...

As a result of Soviet statistical aggregation procedures and the lack of readily available data, virtually no empirical research has been undertaken with respect to the communications industry in the U.S.S.R. The purpose of this paper is two-fold: to describe the nature and structure of the...

This article examines the identification of a system of equations which seeks to explain industrial profitability, concentration, and advertising intensity. We specify a concentration equation which reflects a dynamic adjustment to a long-run level which depends on the nature of entry...

An input monopolist could price discriminate among all downstream industries by integrating into all but the one with the most inelastic derived demand. We demonstrate that a dominant firm will have a similar incentive to integrate into industries with more elastic derived demands. However, the...

This note takes issue with the "reconciliation" proposed by George Wilson between the Steiner and Williamson formulations of the peak-load pricing problem. Wilson respecifies weights without simultaneously addressing himself to the question of expressing output units in consonant terms. This...

This paper analyzes resource extraction when the true size of the reserves and the future costs of extraction are uncertain. The effects of increased uncertainty are investigated under the assumption that the extraction process yields information about the variables which are uncertain at the...