Price Cap Regulation Approach to Improve Productivity in Iranian Municipal Water and Wastewater Companies

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Jaydari Farzaneh; KHODADAD KASHI FARHAD; ABOLHASANI ASGHAR; DARVISHI BAGHER

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Paper Information

Journal: JOURNAL OF SUSTAINABLE GROWTH AND DEVELOPMENT (THE ECONOMIC RESEARCH) Year:2020 | Volume:20 | Issue:2 Page(s): 29-52

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Title

Price Cap Regulation Approach to Improve Productivity in Iranian Municipal Water and Wastewater Companies

Author(s)

Jaydari Farzaneh | KHODADAD KASHI FARHAD | ABOLHASANI ASGHAR | DARVISHI BAGHER | Issue Writer Certificate

Keywords

RegulationQ1

Price-capQ2

urban waterQ1

wastewater companiesQ2

IranQ1

X-factorQ2

QualityQ2

Abstract

The water distribution department of urban water and wastewater companies is of natural monopoly characteristic, and requires regulating. The aim of this research is to regulate urban water and wastewater companies in Iran using a Price-cap Regulation approach to improve their productivity. For this purpose, using the data of municipal water and wastewater companies over the period 2011-2016, the X-factor for the Price-cap Regulation is calculated using two productivity growth and inefficiency balance scenarios. In this scenario building, the Quality of service is included in the calculation of the X factor. Experimental results show that the inclusion of the service Quality index in the calculation of X-factor reduces the rate of productivity improvement of the companies. In addition, the more efficient companies have the lower X-factors, and as a result, experience a higher price cap. This reality encourages companies to increase their efficiency and productivity.

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APA: Copy

Jaydari, Farzaneh, KHODADAD KASHI, FARHAD, ABOLHASANI, ASGHAR, & DARVISHI, BAGHER. (2020). Price Cap Regulation Approach to Improve Productivity in Iranian Municipal Water and Wastewater Companies. JOURNAL OF SUSTAINABLE GROWTH AND DEVELOPMENT (THE ECONOMIC RESEARCH), 20(2 ), 29-52. SID. https://sid.ir/paper/370999/en

Vancouver: Copy

Jaydari Farzaneh, KHODADAD KASHI FARHAD, ABOLHASANI ASGHAR, DARVISHI BAGHER. Price Cap Regulation Approach to Improve Productivity in Iranian Municipal Water and Wastewater Companies. JOURNAL OF SUSTAINABLE GROWTH AND DEVELOPMENT (THE ECONOMIC RESEARCH)[Internet]. 2020;20(2 ):29-52. Available from: https://sid.ir/paper/370999/en

IEEE: Copy

Farzaneh Jaydari, FARHAD KHODADAD KASHI, ASGHAR ABOLHASANI, and BAGHER DARVISHI, “Price Cap Regulation Approach to Improve Productivity in Iranian Municipal Water and Wastewater Companies,” JOURNAL OF SUSTAINABLE GROWTH AND DEVELOPMENT (THE ECONOMIC RESEARCH), vol. 20, no. 2 , pp. 29–52, 2020, [Online]. Available: https://sid.ir/paper/370999/en

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