Mergers and acquisitions as a response to the deregulation of the electric power industry: value creation or value destruction?

Many electric utilities, as a response to the deregulation of the electric power industry, adopted a strategy of acquiring other electric or gas utilities. We examine whether these merger and acquisition strategies create value for the utility shareholders and whether the strategies result in superior post-merger operating and stock-price performance relative to utilities that did not grow through acquisitions. We find little evidence that the mergers and acquisitions created long-term value for a fully diversified investor. Furthermore, the stock price and operating performance of the acquirers under performed the stock price and operating performance of a control portfolio of utilities that did not engage in merger activity.      

Cost Savings From Generation and Distribution with an Application to Italian Electric Utilities*

In the last decade, the European Commission promoted a new regulatory framework aiming at a gradual liberalization of the energy markets. The introduction of competition among generators implies the need to separate generation from transmission and distribution activities. However, if savings can be reached by operating at different stages, vertical separation would increase the costs of providing power. This paper tests for the presence of economies from vertical integration on a sample of Italian local electric utilities and finds evidence of both multi-stage economies of scale and vertical economies. Even if the hypothesis of global subadditivity is not supported, our evidence suggests that a complete divestiture policy would entail efficiency losses. *For helpful comments and discussions, we thank two anonymous referees, Graziano Abrate, Bruno Bosco, Diego Piacentino, and participants at the 31st Annual Conference of the European Association for Research in Industrial Economics (EARIE), Berlin, Germany, 2–5 September, 2004, the 60th Congress of the International Institute of Public Finance (IIPF), Milan, Italy, 23–26 August, 2004, and seminars held at the Bocconi University, University of Lecce, University of Naples, University of Pavia, and University of Turin, where earlier versions of this paper were presented. The financial support of MIUR (COFIN 2002) and HERMES Research Center is gratefully acknowledged. The usual disclaimer applies. **HERMES, Center for Research on Regulated Services, Fondazione Collegio Carlo Alberto, Via Real Collegio 30, 10024 Moncalieri (TO), Italy, http://www.hermesricerche.it.     

Alternative Environmental Regulation Schemes for the Belgian Power Generation Sector

This paper discusses the effects of alternative waysof using external cost estimates to regulateinvestments and generation in the electricityproduction sector. Starting from the existing system,four alternatives are considered: emission taxes forthe utility and for independent producers, emissiontaxes limited to the electric utility, emissionpermits limited to the electric utility and finally asystem where only investments are regulated, anddispatch is not. Taking external damage estimates fromthe literature, these alternatives are compared usinga dynamic partial equilibrium model of the Belgianelectricity market for the period 1995–2034. Theefficiency and distribution effects of the alternativeenvironmental policy instruments are quantified.     

Cost Minimization and Elasticity Estimation: A Two-Input,Two-Time Period Analysis

Given data on input price changes and the resulting changes in optimal input use, a means of estimating numerical elasticity values for the two-input, two-time period case is presented in this article. The estimation procedure stems directly from the model of cost minimization subject to producing a given level of output. By showing the direct link from the world of theory to that of measurement, the author provides an interesting framework to illustrate the cost-minimization model's implications beyond the study of first- and second-order conditions. In developing estimation equations, opportunities arise for presenting and reviewing key economic concepts and mathematical techniques. The connection of the theoretical model with a numerical application helps students better appreciate the relevance of theory in finding quantitative answers to economic problems.     

The cost effectiveness of zonisamide as adjunctive therapy in adult partial seizure epilepsy

Summary

Many patients with epilepsy continue to have partial seizures requiring add-on antiepileptic drugs (AEDs). Zonisamide, a broad-spectrum AED, has recently entered the European market and must be compared with the current standard of care. The objective of this study was to determine the cost effectiveness of zonisamide as treatment for adults with uncontrolled partial epilepsy in Scotland. A Markov decision model was developed from the perspective of the Scottish National Health Service. Outcome measures included quality-adjusted life-years (QALYs) and costs in GBP.

Patients treated with zonisamide had a 15-year incremental cost of £20 and 0.026 additional QALYs compared with patients treated with levetiracetam. These modest differences result in an incremental cost-effectiveness ratio for zonisamide of £761/QALY.

We conclude that zonisamide is a cost-effective treatment for adult patients with refractory partial epilepsy being treated according to Scottish treatment patterns and costs, assuming a willingness to pay of £20,000/QALY.     

Deregulation with consensus

We analyze the problem of eliminating an inefficient regulation, such as protection, in a dynamic model in which there is incomplete information and unanimous approval from all parties involved is necessary. Existing firms have heterogeneous cost, and efficiency requires some of them to shut down when the inefficient regulation is eliminated. The government can set up a revelation mechanism, giving subsidies and requiring firms to exit the market at a given time depending on the information collected. Under full commitment the optimal policy prescribes that some inefficient firms remain active and are subsidized. The optimal policy takes a simple form, with at most two times at which the firms are allowed to exit. We are very grateful to Matt Mitchell whose comments substantially improved the paper.     

煤炭企业环境成本控制问题及对策

作为国有企业资源类型的整合,煤炭企业的发展不仅要重视经济效益,也要注意环境成本。煤炭是当今社会经济快速发展的主要需求资源,但煤炭资源的开采给环境带来了许多负面的影响,环境成本是煤炭企业的主要成本之一。针对煤炭行业,分析其环境成本控制方面存在的问题,并提出解决对策,对该行业环境成本控制有一定的借鉴作用。     

当代经典论文对企业利润最大化目标的思考

古典经济学理论认为利润最大化是企业的根本目标,但是科斯、阿尔钦、FAMA、张五常等当代经济学家在其经典论文中分别对企业的本质、规模、相互关系、委托代理机制等方面进行分析时均从成本最小化的角度进行分析的。本文通过论证企业成本最小化和利润最大化的对称性和可转换性,解释了从成本最小化进行分析的原因。同时提出由于利润最大化的不确定性和成本最小化的易操作性,企业在相对确定的条件下,可将利润最大化目标转化为成本最小化形式进行实际运作。     

Differential Effects of Rail Deregulation on US Grain Producers

The efficiency benefits of US rail industry deregulation have been widely documented. This research provides new insight regarding the accrual of benefits within the US grain industry. A study of rail grain rates from 1980 to 2000 finds railroads decreased rates for all grain shippers. The greatest gain in benefits was to producers in the most competitive market environments. Regions and products with less competitive transportation markets will become increasingly disadvantaged if the trend continues. Rail rates are a key determinant in grain market viability and producer profitability in these rail dominated markets.     

遏制煤矿事故构建和谐社会

近几年,煤炭企业的伤亡事故频频发生,成为建设和谐社会不能承受之重。我国煤矿事故多发的直接原因是利益的驱动,煤矿事故多发的深层次原因是经济增长方式落后,旧的生产模式遗留的恶果。要以科学发展观指导,建立和完善煤矿安全生产指标及控制体系,提高科学技术水平。遏制煤矿事故,促进社会主义和谐。     

社会资本规制与产权安排的替代效用和替代规则

按照科斯定理的逻辑,可以证明社会资本规制与产权安排具有相互替代的效用;而两者之间的替代规则,可以在交易成本理论的平台上,从交易的频率、专用性、异质性三个维度进行刻画;对于现实中的社会资本规制和产权安排的互补现象,也可以通过交易成本递增和外部性分析,在满足两者效用替代的基础上得到解释。     

基于消费者视角的电动汽车全寿命周期成本模型及分析

本文以全寿命周期成本理论为基础,从消费者角度对电动汽车全寿命周期内的成本进行了全面分析,建立了电动汽车的全寿命周期成本模型,为电动汽车的保有成本估算提供了方法依据。同时,将电动汽车与燃油汽车就成本进行了比较分析。结论表明,电动汽车的全寿命周期成本远低于燃油汽车,在同等条件下理性消费者会更倾向于选择电动汽车。     

Effective regulation versus tacit collusion in the long-distance market: an empirical analysis

Regulatory decisions often must be made in an atmosphere of uncertainty, and arguments presented by the affected parties frequently add to, rather than resolve, that uncertainty. Here, we examine several of the deregulatory decisions affecting the long-distance market that were rendered by the FCC over the two-decade period following the divestiture of AT&T. Our purpose is to provide empirical evidence relevant to some of the arguments regarding market conditions that were presented during that period. Findings suggest that some of the more prominent allegations are not supported by the data.