Pricing Dynamics of Network Utilities in Developing Countries

• Tác giả: Omar Chisari
• Ngôn ngữ: eng
• Ký hiệu phân loại: 330.91 Treatment by areas, regions, places in general
• Thông tin xuất bản: 2012
• Bộ sưu tập: Tài liệu truy cập mở
• ID: 322763
• Chủ đề: 1. Contracts and Reputation; 2. Network Formation and Analysis: Theory D850; 3. Networks L140; 4. Transactional Relationships; 5. Utilities: General L970

Tóm tắt

This paper examines the pricing of a utility with an underdeveloped network facing a competitive fringe, short-run network adjustment costs, theft of service, and the threat of retaliatory government intervention that is increasing with the price it charges. Under a variety of plausible assumptions (in the context of developing countries) the utility will find its long-run profits enhanced if it exercises pricing restraint in the early stages of network development. These findings provide some useful insights for the design of post-privatization regulatory governance in developing countries where years of price controls have contributed to choking off investment in network expansion.