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The intention of this paper is to contribute empirical observations and conclusions about monopolistic behaviour in network industries. This will be achieved by examining a special case in the electricity industry of Wurttemberg. The provision of electricity in Wurttemberg was organized in regional companies until 1933, when they were forced to merge into the Energie-Versorgung Schwaben AG. After the First World War companies started to work together, and two rivaling network operators were founded, the Württembergische Landes-Elektrizitäts AG (WLAG) and the Württembergische Sammelschienen AG (WÜSAG). The purpose of these companies was to construct and operate a transportation network between the electricity providers. They also established connections with the neighbouring states for imports of electrical power from external sources. Within the WÜSAG the customers were discriminated by monopolistic price-setting. This has lead to a nearly complete exploitation of the WÜSAG and some of her customers by one of her associates, the Rheinisch Westfälische Elektrizitätswerke AG (RWE). The behaviour of the WLAG instead has lead to a more competitional outcome. There the customers had to pay nearly identical and significantly lower prices. This analysis also demonstrates the incentives and barriers for these different behaviours.

jahrbuch für wirtschaftsgeschichte / economic history yearbook

Marktmacht und Preisdiskriminierung: Die ökonomischen Aktivitäten der beiden eigenständigen Netzwerkbetreiber WLAG und WÜSAG in der Elektrizitätsindustrie von Württemberg 1924-1933