Privatization Versus Groundwater Central Management

A group of free market natural resource economists argue that the current system of limited property rights for groundwater users should be replaced by a new system of freely transferable property rights This, they contend, would provide the more efficient allocation of groundwater resources and help alleviate the water scarcity problem in the United States Their case for privatization is critically appraised Groundwater hydrology , common property, contamination , and other third party effects are examined to determine the set of circumstances under which privatization would work best The following alternatives to the full privatization plan are also examined central management, legal reform , and "French style" privatized management of water systems     

Monopoly Pricing as a Consumer Exaction in the Public Utility Sector

A bstract . The many studies on the measurement of deadweight welfare loss due to monopoly pricing have largely ignored the public utility sector of the economy. For the residential customer class in the municipally-owned water industry , the useable formula for the welfare loss triangle depends on the divergence between price and long run marginal cos and the price elasticity of demand Only price is directly observable. Statistical methodology developed here and elsewhere provides unique estimates of marginal cost and elasticity for each utility. The welfare loss, as a percentage of the residential customer class's annual water bill, is 9 to 10 per cent for locally regulated water utilities and 5 to 6 per cent for state regulated utilities–a level above those reported in most of the studies on manufacturing industries. Regulation , however, can make a difference.     

Third Party Effects of Groundwater Law in the United States:

A bstract . Groundwater is an increasingly important component in the nation's total water supply. Although groundwater is one of this nation's most abundant resources, falling water tables and contamination episodes have caused localized water shortages. This has led to news media accounts describing water supply as our nation's next natural resource crisis. The problem with groundwater supply can be attributed in part to the current system of incomplete property rights. This, in combination with the common pool characteristics of underground water and other third party effects, has resulted in technical and allocative inefficiency. Groundwater hydrology , common property, contamination, and other third party effects are examined in seeking the causes of the current water crisis .     

Performance Management in Insurance Firms by Using Transfer Pricing

In this article, we analyze the asset and liability management and market risk systems of insurance companies. We discuss that the current system is not goal congruent and does not satisfy necessary conditions for effective control. It follows that managers are unable to run their business effectively. We develop a transfer pricing system that allows the clear separation of underwriting and investment activities, both on the risk and return aspects. It creates the appropriate incentive schemes. We illustrate this system with an example indicating the differences in incentives between the traditional embedded value measures and the proposed funds transfer pricing system.