Depreciation and Profitability under Rate of Return Regulation

Shimon Awerbuch

Journal of Regulatory Economics, 1992, vol. 4, issue 1, 63-70

Abstract: This paper examines the widely-held notion that the regulatory approach to setting earnings equalizes the accounting and internal rates of return and that this condition holds for any depreciation profile. The evidence suggests that the practical usefulness of this proposition for policy-making may be quite limited. This paper also examines the underlying premise--that, because of its relative constancy over time, the regulated rate of return must equal the internal rate of return--and finds that contrary to earlier suggestions, this result does not always hold in the multi-asset case. Copyright 1992 by Kluwer Academic Publishers

Date: 1992
References: Add references at CitEc
Citations: View citations in EconPapers (2)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

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:kap:regeco:v:4:y:1992:i:1:p:63-70

Ordering information: This journal article can be ordered from
http://www.springer. ... on/journal/11149/PS2

Access Statistics for this article

Journal of Regulatory Economics is currently edited by Menaham Spiegel

More articles in Journal of Regulatory Economics from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().