Abstract
I examine inefficiencies in Japanese water utility companies. Efficiency in this context is defined as a firm's capacity to maximize output given a fixed level of inputs. The findings suggest that the average operation rate, customer density and size variables are associated with lower levels of inefficiency (or higher levels of efficiency), while water purification (a conditioning variable capturing low initial water quality), subsidies and outsourcing are associated with higher levels of inefficiency. Since inefficiency exists, there is an opportunity to improve Japanese water utilities by working on emulating "best practice" firms whenever possible and by providing a regulatory framework that can set appropriate incentive schemes to do so. © 2013 Springer Science + Business Media New York.
Recommended Citation
Phillips, M. (2013). Inefficiency in Japanese Water Utility Firms: A Stochastic Frontier Approach. Journal of Regulatory Economics, 44(2), pp. 197-214. Springer.
The definitive version is available at https://doi.org/10.1007/s11149-013-9225-8
Department(s)
Economics
Keywords and Phrases
Japan water utilities; Stochastic frontier analysis; Water utility regulation
International Standard Serial Number (ISSN)
0922-680X
Document Type
Article - Journal
Document Version
Citation
File Type
text
Language(s)
English
Rights
© 2024 Springer, All rights reserved.
Publication Date
01 Oct 2013
