A KEYNESIAN MODEL APPLIED TO THE WATER AND SEWAGE PUBLIC UTILITY OPERATORS

Aniko Kuntz () and Cristina Driha ()
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Aniko Kuntz: Doctoral School of Economic Sciences, Faculty of Economic Sciences, University of Oradea, Oradea, Romania
Cristina Driha: Doctoral School of Economic Sciences, Faculty of Economic Sciences, University of Oradea, Oradea, Romania

Annals of Faculty of Economics, 2020, vol. 1, issue 2, 179-191

Abstract: This article presents a short foray into the scientific specialized literature on public utility services in Romania, and in particular, the utility services in the field of water supply and sewerage network. It is essential to satisfy the requirements and the needs of the client in the field of public utility services, the performance in this field being the only feasible option to ensure the quality of the services safety and accessibility, the equal treatment of the users, the continuity of the activity and last, but not least, the adaptability and the flexibility regarding the requirements. Through the performed research, by using the Keynesian model applied to the financial data reported by the local water supply operator, aimed to obtain an insight into the evolution of revenue and expenditure, as well as the effect of increased investment. These elements express the relationship between resources and results, and their balance is based on a Keynesian model in a closed economy. By applying the Keynesian model, we have concluded that the evolution of revenue and expenditure is influenced by a number of factors which can lead to a decrease in expenditure, but although that, the revenues increase from year to year. The Keynesian model applied in the economy of public utility services, involves in its structure variables such as investments, and by applying the investment multiplier consumption remains the economic phenomenon that dominates the water supply economy. However, an increase in consumption has the ultimate effect of obtaining a profit for the operator, which will in the future be its own source of financing for investments in the water supply and sewerage system. Thus the orientation towards consumption becomes beneficial both in terms of satisfaction of end-users and from the point of view of the operator, in terms of revenue growth and the analysis of the. Even if capital goods do not directly meet the needs of end-users, they lead to the development of public utilities and its specific infrastructure, and to the fulfilment of the eligibility conditions imposed by the European Union's financing programmers. Expansion investments in water and sewerage services have the direct effect of increasing the number of users, as well as increasing the number of employees of the operator.

Keywords: performance; requirements of the public utility services; marginal propensity to consume; the investment multiplier (search for similar items in EconPapers)
JEL-codes: E12 E13 H50 L32 L97 (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (1)

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