Quotation Gugler, Klaus, Rammerstorfer, Margarethe, Schmitt, Stephan. 2013. Ownership Unbundling and Investment in Electricity Markets - A Cross CountryStudy. Energy Economics 40, 702-713.




This paper is the first to explicitly test for the presence of a trade-off between static and dynamic efficiency and a trade-off between vertical economies and competition in a regulated industry, the electricity industry. We show for 16 European countries over the period 1998–2008 that higher electricity end-user prices in a country subsequently lead to larger aggregate investments in the capital stock, i.e. in generation, distribution and transmission assets. Moreover, there is a trade-off between vertical economies and competition. Ownership unbundling and forced access to the incumbent transmission grid increases competition but come at the cost of lost vertical economies. Generally, we find that regulation that affects only the market directly, like the establishment of a wholesale market or free choice of suppliers, increases aggregate investment. Regulation, however, that adversely affects the incumbent directly, like ownership unbundling, decreases aggregate investment spending.


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Publication's profile

Status of publication Published
Affiliation WU
Type of publication Journal article
Journal Energy Economics
Citation Index SSCI
WU Journalrating 2009 A
WU-Journal-Rating new FIN-A, STRAT-B, VW-B, WH-B
Language English
Title Ownership Unbundling and Investment in Electricity Markets - A Cross CountryStudy
Volume 40
Year 2013
Page from 702
Page to 713
Reviewed? Y
URL https://www.sciencedirect.com/science/article/pii/S0140988313001953
DOI http://dx.doi.org/10.1016/j.eneco.2013.08.022


Gugler, Klaus (Details)
Rammerstorfer, Margarethe (Details)
Schmitt, Stephan (Former researcher)
Research Institute for Regulatory Economics FI (Details)
Department of Economics (Gugler) (Details)
Institute for Finance, Banking and Insurance IN (Details)
Research areas (Ă–STAT Classification 'Statistik Austria')
5372 Regulatory economics (Details)
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