Published June 1979
| Submitted
Working Paper
Open
An Analysis of Fully Distributed Cost Pricing in Regulated Industries
- Creators
- Braeutigam, Ronald R.
Chicago
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Abstract
This paper examines the economic consequences of allocating common costs by (1) gross revenues, (2) directly attributable costs, and (3) relative output levels (such as ton-miles) to determine fully distributed cost prices for regulated firms. The analysis characterizes FDC tariffs, examining the nature of the economic inefficiency associated with the rules, and explains how opportunities for entry by unregulated firms might change if Ramsey optimal pricing were used instead of FDC pricing.
Additional Information
This research was supported in part under a DOE grant, EY-76-G-03-1305, EQL Block. I wish to thank the Environmental Quality Laboratory at the California Institute of Technology for its assistant in this work. I would also like to thank James Quirk, Roger Noll, F. M. Scherer, O.E. Williamson, and an anonymous referee for their helpful comments on an earlier draft. Published as Braeutigam, Ronald R. "An analysis of fully distributed cost pricing in regulated industries." The Bell Journal of Economics (1980): 182-196.Attached Files
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Additional details
- Eprint ID
- 82397
- Resolver ID
- CaltechAUTHORS:20171016-163908587
- Department of Energy (DOE)
- EY-76-G-03-1305
- Created
-
2017-10-17Created from EPrint's datestamp field
- Updated
-
2019-10-03Created from EPrint's last_modified field
- Caltech groups
- Social Science Working Papers, Environmental Quality Laboratory
- Series Name
- Social Science Working Paper
- Series Volume or Issue Number
- 270