Extensions to Simultaneous Equations and Customer Classes
Thus far the analysis has involved separate inquiries into the determinants of utility costs and the determinants of the overall price of power. This approach has yielded insights into the roles played by vertical integration, public ownership, and competition, among other factors, and those will remain key conclusions. This chapter generalizes the previous analysis in two significant directions. The first involves a simultaneous-equations model of price, quantity, and cost determination. The second disaggregates demand and pricing into residential, commercial, and industrial customer classes.
KeywordsDemand Function Vertical Integration Price Equation Public Ownership Customer Class
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