Productivity Growth and the General X-factor in Austria´s Gas Distribution

Gugler, Klaus and Liebensteiner, Mario (2016) Productivity Growth and the General X-factor in Austria´s Gas Distribution. Department of Economics Working Paper Series, 236. WU Vienna University of Economics and Business, Vienna.


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We estimate cost functions to derive productivity growth using a unique database on costs and outputs of essentially all regulated Austrian gas distribution companies over the period 2002-2013, covering the times before and after the introduction of incentive regulation in 2008. We estimate a concave relation between total costs and time, and a significant one-off but permanent reduction in real costs after an imposed reduction in granted costs in the course of the introduction of incentive regulation. Our results imply that technological opportunities were higher in the early years of the sample than in later years, and that productivity growth grinded to a halt from 2008 on. We conclude that technological opportunities are exhausted (for the time being) in the Austrian gas distribution sector giving rise to an optimal general X factor (X-gen) of zero for the foreseeable future. (authors' abstract)

Item Type: Paper
Keywords: X-gen / Productivity / Regulation / Gas distribution
Classification Codes: JEL L22, L25, L51, Q48
Divisions: Departments > Volkswirtschaft
Depositing User: Claudia Tering-Raunig
Date Deposited: 03 Nov 2016 09:44
Last Modified: 22 Oct 2019 00:41


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