Brigham, Bitten and Waterson, Michael, 1950- (2003) Strategic change in the market for domestic electricity in the UK. Discussion Paper. [Warwick Business School, Centre for Management under Regulation]..

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Abstract

This paper examines developments in the market for domestic electricity supply in the UK since September 1998 when the market was thrown over to competition using a variety of sources including firm interviews and a consumer questionnaire. We find that there was a substantial amount of entry, but that there has since been significant consolidation. There is still a substantial gap between the prices set by a firm in its incumbent area and prices obtainable from entrants to the market. There is no evidence that the market is near to Bertrand in operation.

Item Type:	Working or Discussion Paper (Discussion Paper)
Subjects:	H Social Sciences > HB Economic Theory
Divisions:	Faculty of Social Sciences > Warwick Business School
Library of Congress Subject Headings (LCSH):	Electric utilities -- Great Britain, Public utilities -- Deregulation -- Great Britain, Competition -- Great Britain
Publisher:	[Warwick Business School, Centre for Management under Regulation]
Date:	February 2003
Number of Pages:	20
Status:	Not Peer Reviewed
Access rights to Published version:	Open Access
Funder:	Leverhulme Trust (LT), Electricity Association Fuel Poverty Task Force
Grant number:	F215/AX
References:	M. Armstrong, S. Cowan and J. Vickers, Regulatory Reform: Economic Analysis and British Experience. MIT Press, 1994. S. Berry, Estimation of a Model of Entry in the Airline Industry, Econometrica, 60, (July 1992), pp. 889-917. S. Borenstein, Hubs and High Fares: Dominance and Market Power in the U.S. Airline Industry, Rand Journal of Economics, 20, (Autumn 1989), 344-365. M. Giulietti, C. Waddams Price and M. Waterson, Consumer Choice and Industrial Policy: A Study of UK Energy Markets, Centre for Competition and Regulation. Working Paper CCR 01-5, University of East Anglia, October 2001. http://www.basicpower.co.uk/basicpower_web.htm http://www.energywatch.org.uk/ http://www.energywatch.org.uk/compare/ http://www.ofgem.gov.uk/ http://www.southern-electric.co.uk/home/homeindex.asp A.S. Joskow, G. Werden and R. Johnson, Entry, Exit and performance in Airline Markets, International Journal of Industrial Organization, 12, (December 1994), 457- 471. D. Sharratt. and B.H. Brigham, The Utility of social Obligations in the UK energy Industry, Mimeo, 2002, Centre for Management Under Regulation, University of Warwick. S. Singh, M. Utton and M. Waterson, Strategic Behaviour of Incumbent Firms in the UK, International Journal of Industrial Organisation, 16, March 1998, pp. 229-251. M.D. Whinston and S.C. Collins, Entry and Competitive Structure in Deregulated Airline Markets: an event study of People Express, Rand Journal of Economics, 23, (Winter 1992), pp. 446-462.
URI:	http://wrap.warwick.ac.uk/id/eprint/23

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