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Self-Selecting Tariffs under Pure Preferences among Tariffs

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  • Train, Kenneth E

Abstract

The behavioral assumptions for welfare analysis of self-selecting tariffs are generalized to be consistent with those maintained in empirical models of tariff choice. When customers have pure preferences among tariffs, it is shown that the optimal self-selecting tariffs provide strictly greater welfare than mandatory marginal cost prices, contain marginal prices that do not equal marginal cost, and can Pareto dominate an existing tariff. As an illustration of the theoretical results, optimal self-selecting tariffs are calculated empirically for a local telephone company. Copyright 1994 by Kluwer Academic Publishers

Suggested Citation

  • Train, Kenneth E, 1994. "Self-Selecting Tariffs under Pure Preferences among Tariffs," Journal of Regulatory Economics, Springer, vol. 6(3), pages 247-264, September.
    • Handle: RePEc:kap:regeco:v:6:y:1994:i:3:p:247-64
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    1. repec:spo:wpecon:info:hdl:2441/c6t1fl36hv9s7q89j8m3l01c9 is not listed on IDEAS
    2. repec:spo:wpecon:info:hdl:2441/5k7940uimfdf9c898a1ol5436 is not listed on IDEAS
    3. Salies, Evens, 2013. "Real-time pricing when some consumers resist in saving electricity," Energy Policy, Elsevier, vol. 59(C), pages 843-849.
    4. repec:spo:wpmain:info:hdl:2441/5k7940uimfdf9c898a1ol5436 is not listed on IDEAS
    5. Katharina GASSNER, 1998. "An Estimation of UK Telephone Access Demand Using Pseudo-Panel Data," Cahiers de Recherches Economiques du Département d'économie 9817, Université de Lausanne, Faculté des HEC, Département d’économie.
    6. repec:hal:spmain:info:hdl:2441/c6t1fl36hv9s7q89j8m3l01c9 is not listed on IDEAS
    7. Gassner, Katharina, 1998. "An estimation of UK telephone access demand using Pseudo-Panel data," Utilities Policy, Elsevier, vol. 7(3), pages 143-154, November.
    8. repec:spo:wpmain:info:hdl:2441/c6t1fl36hv9s7q89j8m3l01c9 is not listed on IDEAS
    9. repec:hal:wpspec:info:hdl:2441/c6t1fl36hv9s7q89j8m3l01c9 is not listed on IDEAS
    10. Evens Salies, 2010. "Penalizing Consumers for Saving Electricity," Economics Bulletin, AccessEcon, vol. 30(2), pages 1144-1153.
    11. repec:hal:wpspec:info:hdl:2441/5k7940uimfdf9c898a1ol5436 is not listed on IDEAS
    12. Evens Salies, 2012. "Real-time pricing when consumers have saving costs," Working Papers hal-01070292, HAL.
    13. repec:hal:spmain:info:hdl:2441/5k7940uimfdf9c898a1ol5436 is not listed on IDEAS

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