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OWNERSHIP AND WATER SYSTEM OPERATION 1
Author(s) -
Mann Patrick C.,
Mikesell John L.
Publication year - 1976
Publication title -
jawra journal of the american water resources association
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.957
H-Index - 105
eISSN - 1752-1688
pISSN - 1093-474X
DOI - 10.1111/j.1752-1688.1976.tb00216.x
Subject(s) - diseconomies of scale , business , wage , salary , finance , commission , government (linguistics) , labour economics , state ownership , service (business) , industrial organization , economics , public economics , market economy , economies of scale , marketing , linguistics , philosophy , emerging markets
Two types of organizational systems provide most of the water service in the United States. The investor‐owned firm operates on a profit basis generally subject to state commission regulation. The government‐owned firm is generally confronted by local control. The comparative efficiency of private versus government firm provision of water services is essentially an empirical issue. Unit costs and other operating statistics are examined for water firms of each ownership form. The analysis shows that private firms tend to have higher operation costs than do government firms, possibly attributable to wage‐salary differentials. The analysis also indicates that capital investment in large government firms may result in diseconomies. The analysis creates serious doubt as to whether efficient provision of water services can be better facilitated by large mergers of either ownership form.