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dc.contributor.authorPollitt, M. J.
dc.contributor.authorSteer, S. J.
dc.date.accessioned2016-08-11T15:25:39Z
dc.date.available2016-08-11T15:25:39Z
dc.date.issued2011-08-17
dc.identifier.otherCWPE1152
dc.identifier.urihttps://www.repository.cam.ac.uk/handle/1810/257226
dc.description.abstractMany studies of the water and sewerage industries place significant importance on the benefits of economies of scale and scope and how these relate to vertically integrated firms. We have re-examined the early literature on scale and scope economies and find that these studies do not implicitly preclude non-integrated firms from fully utilising assets for multi-product activities; they can still reap scope economies through trading in the open market. Further, we demonstrate difficulties in separating these two types of economies when assessing firm performance. Trade-offs between governance and production costs are a key issue in determining the value of vertically integrated firms that may undergo divestiture. We discuss the present policy debate regarding the optimal structure of the water and sewerage markets in England and Wales in the light of this, and recommend avenues of research that will help determine the optimal policy.en
dc.publisherFaculty of Economics
dc.relation.ispartofseriesCambridge Working Papers in Economics
dc.rightsAll Rights Reserveden
dc.rights.urihttps://www.rioxx.net/licenses/all-rights-reserved/en
dc.subjectEconomies of scale and scope
dc.subjectvertical separation
dc.subjectwater and sewerage
dc.titleEconomies of Scale and Scope in Network Industries: Lessons for the UK water and sewerage sectors
dc.typeWorking Paper
dc.identifier.doi10.17863/CAM.1154


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