Relative performance of public and private ownership under yardstick competition: electricity retail distribution

This paper focuses on productive efficiency in Swedish retail electricity distribution during 1970-1990 using hedonic output(s) constructed from physical outputs and their qualities and network characteristics. The main focus is on efficiency of privately owned, municipal utilities, municipal companies, and companies with mixed ownerships. Three different approaches are used to examine whether ownership of the distribution companies has any systematic impact on the above issues. We also examine returns to scale and technical change. Empirical results from the three alternative approaches show that privately owned companies are relatively more efficient. We find evidence of scale economies and technical progress.