Is the incumbent local exchange carrier (LEC) a natural monopolist? The analysis indicates that the LEC cost function is not supportable: LECs appear to be either nonsustainable natural monopolies or nonnatural monopolies the set of services they currently offer. However, recent technological...

The electric industry is experiencing increasing competition in generation encouraged by non utility generators and regulatory agencies. An electric utility's problem of satisfying stochastic demand with either power purchased from non utility generators or with its own generators is examined....

Entry of new firms into the electric power industry is becoming commonplace. The entrants typically are unregulated firms that compete with regulated electric utilities only in the generation stage of the latter's vertically integrated structure. Because of the asymmetric regulatory treatment of...

Asymmetric information has occupied a central role in theoretical microeconomics for almost two decades, but little has been done to ascertain when it matters in practice. The regulatory problem of promoting energy conservation offers an opportunity to ascertain if asymmetric information...

The 1978 Public Utility Regulatory Policies Act set energy conservation and efficient, equitable electricity rates as national goals. The decision on whether to implement innovative rates to meet these goals was turned over to state public service commissions, but not all states implemented the...