Regulatory reforms and the efficiency and productivity growth in electricity generation in OECD countries

Satya Paul and Sriram Shankar

Energy Economics, 2022, vol. 108, issue C

Abstract: This paper examines how the energy sector regulatory reforms undertaken in the OECD have had an impact on efficiency and productivity growth in electricity generation during 1980–2013. A stochastic production frontier model that accommodates time-invariant heterogeneity and efficiency effects is applied to the panel data for 25 OECD countries. To ensure that the efficiency scores lie in a unit interval, the efficiency effects are specified by a probit distribution function of three regulatory reforms (vertical integration, entry liberalisation and privatisation) and two control variables. The parametric equivalent of TFP Malmquist index is decomposed into efficiency, scale, and technical changes. Empirical results reveal that vertical disintegration boosts the level of efficiency in the OECD. The fully private-owned and fully public-owned enterprises that co-exist in the OECD region are more efficient than the mixed enterprises. Over the period of study, productivity has grown by 9.69% with an average annual growth rate of 0.27%. This is facilitated by an improvement in efficiency and shift in frontier due to technological innovations.

Keywords: Electricity generation; OECD; Stochastic frontier; Technical efficiency; Standard normal cumulative distribution function; TFP decomposition (search for similar items in EconPapers)
JEL-codes: D24 L51 L94 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0140988322000706
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:108:y:2022:i:c:s0140988322000706

DOI: 10.1016/j.eneco.2022.105888

Access Statistics for this article

Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant

More articles in Energy Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().