Please use this identifier to cite or link to this item: 
Year of Publication: 
Series/Report no.: 
Bremen Energy Working Papers No. 29
Jacobs University Bremen, Bremen Energy Research (BER), Bremen
The factor X in the RPI-X regulation aims to adjust price or revenue allowances to changes in total factor productivity and input prices. A cost Malmquist index can be applied to determine the efficient cost change (ECC). However, regulators typically do not have the necessary data on input quantities and prices. Instead, a TOTEX Malmquist allows for calculating the total cost change (TCC). We study under which conditions the TCC of a TOTEX Malmquist correctly estimates the true ECC. We have two main findings. TCC is an undistorted estimate of ECC if (1) the frontier firms are either fully efficient, or if their inefficiency remain constant over time, and (2) if input prices either stay constant or change by the same proportion for all firms.
price regulation
Malmquist index
total factor productivity
data envelopment analysis
Document Type: 
Working Paper

Files in This Item:
414.61 kB

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.