Dynamic model of the United States electric utility industry, 1950-2010.

1975 ◽  
Author(s):  
Andrew (Frederick Andrew) Ford
Keyword(s):  
United States ◽  
Dynamic Model ◽  
The United States ◽  
Electric Utility ◽  
Electric Utility Industry ◽  
Utility Industry

The Market for Capital and the Origins of State Regulation of Electric Utilities in the United States

2002 ◽  
Vol 62 (4) ◽  
pp. 1050-1073 ◽  
Author(s):  
William J. Hausman ◽  
John L. Neufeld
Keyword(s):  
Electric Utilities ◽  
The United States ◽  
Electric Utility ◽  
State Regulation ◽  
Electric Utility Industry ◽  
Firm Level ◽  
Borrowing Costs ◽  
Utility Industry ◽  
State Rate ◽  
Return Regulation

We provide evidence that the problem of raising capital in the early days of the U.S. electric-utility industry motivated industry leaders to embrace state rate-of-return regulation in return for a secure territorial monopoly. Utility executives anticipated that this would lead to a reduction in borrowing costs. Using firm-level bond data for 1910–1919, we estimate a model and find that state regulation led to lower borrowing costs but that the magnitude of the reduction was small. We also find evidence that output of electric utilities in states with regulation was higher than output in states without regulation.

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