IDEAS home Printed from https://ideas.repec.org/a/rje/bellje/v5y1974iautumnp420-458.html
   My bibliography  Save this article

Alternative Investment Models for Firms in the Electric Utilities Industry

Author

Listed:
  • Stephen C. Peck

Abstract

In this paper an analysis is made of the investments in turbogenerator sets made by a sample of 15 firms in the electric utilities industry for the period 1948 through 1969. Two models of firm investment are proposed and tested. The first is directly related to an earlier work of Chenery, in which he pointed out that the existence of economies of scale would lead to lumpy investments. This model is consistent with the individual firm data. The second model is the familiar distributed lag model which predicts that investment will take place smoothly. This model is inconsistent with the individual firm data. In addition, predictions of the aggregate investment of the 15 firms are made with the lumpy model and these fit about as well as a distributed lag model estimated with the aggregate data. Bayesian methods of estimation and inference are used throughout to arrive at these conclusions.

Suggested Citation

  • Stephen C. Peck, 1974. "Alternative Investment Models for Firms in the Electric Utilities Industry," Bell Journal of Economics, The RAND Corporation, vol. 5(2), pages 420-458, Autumn.
    • Handle: RePEc:rje:bellje:v:5:y:1974:i:autumn:p:420-458
    as

    Download full text from publisher

    File URL: http://links.jstor.org/sici?sici=0005-8556%28197423%295%3A2%3C420%3AAIMFFI%3E2.0.CO%3B2-D&origin=repec
    File Function: full text
    Download Restriction: Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.
    ---><---

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

    Citations

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


    Cited by:

    1. Poudineh, Rahmatallah & Jamasb, Tooraj, 2016. "Determinants of investment under incentive regulation: The case of the Norwegian electricity distribution networks," Energy Economics, Elsevier, vol. 53(C), pages 193-202.
    2. Kohei Enami & John Mullahy, 2009. "Tobit at fifty: a brief history of Tobin's remarkable estimator, of related empirical methods, and of limited dependent variable econometrics in health economics," Health Economics, John Wiley & Sons, Ltd., vol. 18(6), pages 619-628, June.
    3. Le, Duc Thuc & Jones, John Bailey, 2005. "Optimal investment with lumpy costs," Journal of Economic Dynamics and Control, Elsevier, vol. 29(7), pages 1211-1236, July.
    4. Michał Konopczyński, 2018. "Optimal fiscal policy in an emerging economy with credit constraints: theory and application for Poland," Central European Journal of Economic Modelling and Econometrics, Central European Journal of Economic Modelling and Econometrics, vol. 10(3), pages 169-231, September.
    5. Palm, Franz C. & Pfann, Gerard A., 1998. "Sources of asymmetry in production factor dynamics," Journal of Econometrics, Elsevier, vol. 82(2), pages 361-392, February.
    6. W Buhr & M Köppel, 1986. "Regional Investment Functions of Material Infrastructure: Theoretical Issues and Selected Empirical Case Studies," Environment and Planning A, , vol. 18(4), pages 491-509, April.
    7. repec:cam:camdae:1324 is not listed on IDEAS
    8. Kohei Enami & John Mullahy, 2008. "Tobit at Fifty: A Brief History of Tobin's Remarkable Estimator, of Related Empirical Methods, and of Limited Dependent Variable Econometrics in Health Economics," NBER Working Papers 14512, National Bureau of Economic Research, Inc.

    More about this item

    Statistics

    Access and download statistics

    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:rje:bellje:v:5:y:1974:i:autumn:p:420-458. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: the person in charge (email available below). General contact details of provider: https://www.rje.org .

    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.