Working Papers

2, 2003 Strategie multi-prodotto nei servizi di pubblica utilità: effetti della diversificazione e della densità dell’utenza
autori

Giovanni FRAQUELLI
Università del Piemonte Orientale “A. Avogadro”, Ceris-CNR, HERMES

Massimiliano PIACENZA
Ceris-CNR, HERMES

Davide VANNONI
Università di Torino - HERMES

  In the paper we study the cost structure of a sample of Italian utilities providing in combination gas, water and electricity. The estimates from a Composite cost function model highlight that costs are lower when multi-utilities operate in high-density areas and when they are diversified also in other services (heating, sewerage, waste water treatment). However, global scope and scale economies are present only for multiutilities operating at low levels of user density (usually small-sized firms in rural areas), whereas they are absent for firms facing a high user density (usually largerscale companies in urban areas). The fact that utilities in the latter group do not benefit from cost synergies across services suggests that their diversification might be due to managerial and/or market power motivations.

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