The Economics of Regulation: Principles and Institutions, Volume 1As Chairman of the Civil Aeronautics Board in the late 1970s, Alfred E. Kahn presided over the deregulation of the airlines and his book, published earlier in that decade, presented the first comprehensive integration of the economic theory and institutional practice of economic regulation. In his lengthy new introduction to this edition Kahn surveys and analyzes the deregulation revolution that has not only swept the airlines but has transformed American public utilities and private industries generally over the past seventeen years. While attitudes toward regulation have changed several times in the intervening years and government regulation has waxed and waned, the question of whether to regulate more or to regulate less is a topic of constant debate, one that The Economics of Regulation addresses incisively. It clearly remains the standard work in the field, a starting point and reference tool for anyone working in regulation.Kahn points out that while dramatic changes have come about in the structurally competitive industries - the airlines, trucking, stock exchange brokerage services, railroads, buses, cable television, oil and natural gas - the consensus about the desirability and necessity for regulated monopoly in public utilities has likewise been dissolving, under the burdens of inflation, fuel crises, and the traumatic experience with nuclear plants. Kahn reviews and assesses the changes in both areas: he is particularly frank in his appraisal of the effect of deregulation on the airlines. His conclusion today mirrors that of his original, seminal work - that different industries need different mixes of institutional arrangements that cannot be decided on the basis of ideology. |
Contents
Economics and Noneconomics Science and Prescription | 14 |
Determination of the Rate Base | 35 |
Regulating Rate Structures | 54 |
3 | 63 |
Problems of Defining Marginal Cost | 70 |
Tempering Principle with Practicalityor One Principle with Another | 83 |
The Appropriate Time Pattern of Rates | 103 |
Decreasing Costs and Price Discrimination | 123 |
Incentive Plans | 59 |
Regulatory Planning 77 | 77 |
The Adjudicatory Role and Its Consequences 86 | 86 |
The Inherent Limitations of Regulation 93 | 93 |
Internal Motivations 101 | 101 |
The Role of Regulation 108 | 108 |
Economics of Scale 116 | 117 |
Competitive Certification versus Centralized Planning | 126 |
Principles of Discrimination | 137 |
Fully Distributed Costs | 150 |
RateMaking in the Presence of Competition | 159 |
The Impact on Competition at the Secondary Level | 166 |
Impact at the Primary Level and Other Institutional Considerations | 175 |
7 | 182 |
Externalities | 193 |
Introduction i | |
Protectionism and Conservatism | 11 |
The Problems Created by Exempt Carriers 18 | 18 |
The Orientation of Regulatory Policy 24 | 24 |
A Few Warning Notes 46 | 46 |
Coordinated Investment Planning 157 | 157 |
Competition for Existing Business versus Protectionism 165 | 165 |
Destructive Competition and the Quality of Service 172 | 172 |
The Theory Applied 178 | 178 |
The Issue of CreamSkimming | 220 |
Integration | 251 |
Intercompany Coordination | 307 |
7 | 320 |
The Choice among Imperfect Systems | 327 |
| 345 | |
Other editions - View all
The Economics of Regulation: Principles and Institutions, Volume 1 Alfred E. Kahn Limited preview - 1988 |
The Economics of Regulation: Principles and Institutions ; Vol ..., Volumes 1-2 Alfred E. Kahn No preview available - 1988 |
Common terms and phrases
additional allocation average total costs basis buyers capacity costs CATV Chapter charges common carriers competition consideration cost of capital costs of serving customers decision decreasing costs demand depreciation distribution earnings Econ economic efficiency economies of scale economist effect elasticity electric example excess extent fact Federal Federal Communications Commission Ibid increasing incremental costs industry institutional interest investment investors joint Jour justified long-run marginal costs lower LRMC monopolistic natural gas natural monopoly off-peak operating opportunity cost output passenger peak permitted pipeline plant possible price discrimination principle problem production profits programs public utility public utility companies purchases railroads rate base rate of return rate reductions reason reduced reflect regulated companies regulatory commissions respective result revenues SRMC stockholders supply taxes telephone television tendency tion traffic transportation trucks unit unregulated users variable costs Volume