IDEAS home Printed from https://ideas.repec.org/a/kap/enreec/v16y2000i1p69-79.html
   My bibliography  Save this article

Inefficiencies in Public Environmental Services

Author

Listed:
  • Roelof de Jong
  • Andries Nentjes
  • Doede Wiersma

Abstract

The paper discusses efficiency issues in the public provision of environmental services, in particular waste water treatment. It is shown that in the face of increasing, respectively decreasing returns to scale the zero profit constraint of a cost minimizing public firm induces underinvestment, respectively overinvestment in public capacity compared with efficient allocation between public purification and effluent control by private polluters. X-inefficiency of the public firm counter-acts the inefficiency in allocation arising from overinvestment, and it reinforces the inefficiency in allocation in case of underinvestment in public purification capacity. As subsidy can bring down the user's charge imposed on sources, but it will also increase X-inefficiency. The subsidy counteracts underinvestment but reinforces overinvestment in public capacity. Copyright Kluwer Academic Publishers 2000

Suggested Citation

  • Roelof de Jong & Andries Nentjes & Doede Wiersma, 2000. "Inefficiencies in Public Environmental Services," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 16(1), pages 69-79, May.
  • Handle: RePEc:kap:enreec:v:16:y:2000:i:1:p:69-79
    DOI: 10.1023/A:1008370023661
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1023/A:1008370023661
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1023/A:1008370023661?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Kolm, Serge-Christophe, 1975. "Rendement qualitatif et financement optimal des politiques d'environnement. (With English summary.)," Econometrica, Econometric Society, vol. 43(1), pages 93-113, January.
    2. Duizendstraal, Anton & Nentjes, Andries, 1994. "Organizational Slack in Subsidized Nonprofit Institutions," Public Choice, Springer, vol. 81(3-4), pages 297-321, December.
    3. Andries Nentjes & Wolfgang Schopp, 2000. "Discretionary Profit in Subsidised Housing Markets," Urban Studies, Urban Studies Journal Limited, vol. 37(1), pages 181-194, January.
    4. Pethig, Rudiger, 1989. "Efficiency versus self-financing in water quality management," Journal of Public Economics, Elsevier, vol. 38(1), pages 75-93, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Fuentes, R. & Torregrosa-Martí, T. & Hernández-Sancho, F., 2017. "Productivity of wastewater treatment plants in the Valencia Region of Spain," Utilities Policy, Elsevier, vol. 46(C), pages 58-70.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nolan Miller & Karen Eggleston & Richard Zeckhauser, 2006. "Provider choice of quality and surplus," International Journal of Health Economics and Management, Springer, vol. 6(2), pages 103-117, June.
    2. Bruno Bises & Fabio Padovano, 2004. "Government Grants to Private Cultural Institutions–The Effects of a Change in the Italian Legislation," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 28(4), pages 303-315, November.
    3. Bruno Bises, 2000. "Exemption or Taxation for Profits of Non-Profits? An Answer from a Model Incorporating Managerial Discretion," Public Choice, Springer, vol. 104(1), pages 19-39, July.
    4. Klaus Fiedler, 1997. "The conditions for ecological sustainable development in the context of a double-limited selfpurification model of an aggregate water resource," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 9(3), pages 309-321, April.
    5. Roelof de Jong & Andries Nentjes & Doede Wiersma, 2002. "The Public Firm and Strategic Interaction: The Case of Public Waste Water Management," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 158(2), pages 221-233, June.
    6. Paul Raschky, 2007. "The overprotective parent - Bureaucratic agencies and natural hazard management," Working Papers 2007-03, Faculty of Economics and Statistics, Universität Innsbruck.
    7. Hielscher, Stefan & Pies, Ingo & Prinz, Aloys, 2015. "Umfassende Organisationsethik für die moderne Gesellschaft: Ein systematischer Vergleich gewinnorientierter und nicht-gewinnorientierter Unternehmen," Discussion Papers 2015-8, Martin Luther University of Halle-Wittenberg, Chair of Economic Ethics.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:enreec:v:16:y:2000:i:1:p:69-79. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.