A cost function for the natural gas transmission industry: further considerations

Olivier Massol

Working Papers from Department of Economics, City University London

Abstract: This article studies the cost function for the natural gas transmission industry. In addition to a tribute to H.B. Chenery, it firstly offers some further comments on a recent contribution (Yépez, 2008): a statistical characterization of long-run scale economies, and a simple reformulation of the long-run problem. An extension is then proposed to analyze how the presence of seasonally-varying flows modifies the optimal design of a transmission infrastructure. Lastly, the case of a firm that anticipates a possible random rise in its future output is also studied to discuss the optimal degree of excess capacity to be built into a new transmission infrastructure.

Keywords: Engineering economics; natural gas transmission; infrastructure planning (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (12)

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https://openaccess.city.ac.uk/id/eprint/1464/1/A_c ... mission_industry.pdf

Related works:
Journal Article: A Cost Function for the Natural Gas Transmission Industry: Further Considerations (2011)
Working Paper: A cost function for the natural gas transmission industry: further considerations (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:cty:dpaper:11/03

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