The Managers versus the Consultants*

Emili Grifell‐Tatjé and C. Lovell
Authors registered in the RePEc Author Service: Emili Grifell-Tatje

Scandinavian Journal of Economics, 2003, vol. 105, issue 1, 119-138

Abstract: Since engineering information is rarely available, standard practice is to benchmark managerial performance against best observed practice. We exploit a rare opportunity to benchmark managerial performance against engineering standards. Our managerial performance describes the activities of Spanish electricity distributors, and our engineering standards are obtained from an engineering grid created by an international consultancy. We find the consultancy's network to be much less costly to operate. When we decompose the cost differential, we find that the superior network design, combined with lower input prices, accounts for more than all of the predicted cost savings. However we also find that the managers are more cost efficient than the consultancy, presumably because they exploit their incentive to be cost efficient under a revenue cap regulatory regime.

Date: 2003
References: Add references at CitEc
Citations: View citations in EconPapers (15)

Downloads: (external link)
https://doi.org/10.1111/1467-9442.00008

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:bla:scandj:v:105:y:2003:i:1:p:119-138

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0347-0520

Access Statistics for this article

Scandinavian Journal of Economics is currently edited by Richard Friberg, Matti Liski and Kjetil Storesletten

More articles in Scandinavian Journal of Economics from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().