The revenue-maximizing firm presumably has an internal return requirement that is at least as large as the maximum return permitted by a regulatory agency. In this case, which is the only one that seems economically meaningful, the undercapitalization result of Bailey-Malone holds throughout the...

The analysis seeks to determine the impact of lagged regulation on a profit-maximizing firm subject to a rate-of-return constraint. We are particularly interested in the effect of lag on the accomplishment of two regulatory goals: minimum-cost production, and an output greater than that of an...

This paper extends a simple economic model of the regulated firm to include a wider range of both management objectives and of regulatory constraint. The authors find that these generalizations in the assumptions are able to effect profound alterations in the conclusions. For example, if a firm...

This paper examines the pattern of peak and offpeak prices for several models of firm behavior beyond the standard welfare-maximizing models of Boiteux, Steiner, and Williamson. In the case where there is a profit objective or a breakeven constraint, we show that it can be rational for the firm...