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WATER SUPPLY COSTS FOR SMALL PRIVATE UTILITIES 1
Author(s) -
Male James W.,
Moriarty John B.,
Stevens Thomas H.,
Willis Cleve E.
Publication year - 1991
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.1752-1688.1991.tb01452.x
Subject(s) - marginal cost , economics , water supply , range (aeronautics) , econometric model , unit (ring theory) , supply , natural resource economics , marginal utility , econometrics , environmental science , microeconomics , environmental engineering , mathematics , engineering , mathematics education , aerospace engineering
This paper examines the cost of water supply for small and mid‐sized private water utilities. An econometric approach was employed in which data on utility costs and characteristics were used to estimate a total water supply cost function from which average and marginal costs were derived. The results suggest that although average and marginal costs decline with output, the rate of decline rapidly approaches zero, and unit costs therefore appear to remain relatively constant over a wide range of output. Implications of the results for pricing policy are examined.