The Impact of the Regulatory Reform Process on R&D Investment of European Electricity Utilities

Stephan Schmitt and Denes Kucsera

VfS Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order from Verein für Socialpolitik / German Economic Association

Abstract: The aim of this paper is to give deeper insights into the impact of regulatory reforms and privatization on R&D spending of electricity utilities. Building on a panel data set including the biggest European utilities from eight EU-countries over a period from 1985 until 2010, we find a strong negative influence of privatization and also a negative overall impact of regulation on R&D investment. Nearing competition has a dampening effect on R&D spending, but once the market and regulatory framework conditions have been established, higher levels of competition positively influence R&D. Our results further indicate that the relation between competition and innovative investment can be described as inverted U-shaped. Finally, we could not find any evidence that (ownership) unbundling and incentive regulation affect R&D expenditures of the utilities.

JEL-codes: L43 L51 L94 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-ene, nep-eur, nep-ino, nep-pbe, nep-reg and nep-sbm
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc13:80035

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