Effects Of Regulatory Regimes Research Articles

Drivers of productivity change: a comparison of English and Welsh water only and water and sewerage companies

ABSTRACT In regulated industries, such as the water industry, it is of great significance to estimate productivity change as it helps policy makers to evaluate the effectiveness of regulatory regime and industry performance. In this paper, and for the first time, a translog input distance function was used to estimate and decompose productivity change into several components such as technical efficiency change, scale efficiency change, input-mix, and technical change. A further decomposition of technical change into neutral, output- and input-induced shifts of the frontier is provided. The above decomposition was applied to the English and Welsh water and sewerage companies and water only companies over the years 1993–2016. The results indicated that over the entire period water industry’s productivity increased by 9% per year, mainly due to scale efficiency change, input mix and technical change. On average water only companies reported higher productivity gains than water and sewerage companies.

Regulating Emerging and Future Technologies in the Present

Scientific knowledge and technological expertise continue to evolve rapidly. Such innovation gives rise to new benefits as well as risks, at an ever-increasing pace. Within this context, regulatory regimes must function in order to address policymakers’ objectives. Innovation, though, can challenge the functioning and effectiveness of regulatory regimes. Questions over fit, effectiveness, and capacity of these regimes to ensure the safe entry of such technologies, and their products, onto the market will be asked in parallel to their development. With this in mind, this article examines the strengths and weaknesses of current regulatory frameworks, including those designed for biotechnology, cosmetics, novel organisms, and foods, in order to inform and help shape Australia’s regulatory landscape around innovation. By focusing on Australia, the article illustrates the need to assess future changes to regulatory frameworks using a careful balancing of key factors. These include, for example, horizon scanning and monitoring, availability of appropriate data, existing health, safety, environmental, ethical, and social risks and impacts, and regulatory capacity. The article argues that rather than using one of these factors in isolation, a careful assessment of where each factor stands can lead regulators to an approach that properly manages the potential risks of emerging technologies.

Sales Growth of New Pharmaceuticals Across the Globe: The Role of Regulatory Regimes

Prior marketing literature has overlooked the role of regulatory regimes in explaining international sales growth of new products. This paper addresses this gap in the context of new pharmaceuticals (15 new molecules in 34 countries) and sheds light on the effects of regulatory regimes on new drug sales across the globe. Based on a time-varying coefficient model, we find that differences in regulation substantially contribute to cross-country variation in sales. One of the regulatory constraints investigated, i.e., manufacturer price controls, has a positive effect on drug sales. The other forms of regulation such as restrictions of physician prescription budgets and the prohibition of direct-to-consumer advertising (DTCA) tend to hurt sales. The effect of manufacturer price controls is similar for newly launched and mature drugs. By contrast, regulations on physician prescription budgets and DTCA have a differential effect for newly launched and mature drugs. Whereas the former hurts mature drugs more, the latter has a larger effect on newly launched drugs. In addition to these regulatory effects, we find that national culture, economic wealth, and lagged sales also affect drug sales. Our findings may be used as input by managers for international launch and marketing decisions. They may also be used by public policy administrators to assess the role of regulatory regimes in pharmaceutical sales growth.

Stakeholder Perspectives on Regulatory Aspects of Antarctic Tourism

Over the last decade, Antarctic tourism has experienced an exponential growth in tourist numbers and a diversification of tourist activities resulting in questions that challenge the effectiveness and adequacy of the current regulatory regime. Three categories of key Antarctic tourism stakeholders—regulators, organizers, and monitors—were interviewed and provided their perspective on some of the main aspects of Antarctic tourism regulation. The current and anticipated future state of Antarctic tourism, tourism practice and ethos, the success of regulatory mechanisms through the Antarctic Treaty System and International Association of Antarctica Tour Operators (IAATO), and the cooperation between the stakeholder groups are explored to draw conclusions about the effectiveness of the regulatory regime. The study confirms that currently Antarctic tourism can be adequately regulated through existing mechanisms, but that growing numbers of tourists and vessels may require more stringent tools to be adopted. Site-specific guidelines are identified as effective tools for a targeted and flexible regulation of primarily ship-borne tourism.

Dynamics, Efficiency and Network Industries: A Special Issue of the Review of Network Economics (Introduction and Overview)

The primary purpose of this special issue of the Review of Network Economics is to address issues related to the dynamics of firm behavior and efficiency in network industries. A secondary purpose, where relevant, is to analyze the relationship between the nature of the regulatory regime and the performance over time of the firms subject to that regime. Topics include: the evolution of price-cost margins, the incentives to undertake investment, innovation and the implications for productivity growth, the dynamics of firm interaction and strategic behavior, and the development and effectiveness of regulatory regimes. Network industries are so-named because they typically require the utilization of a network or infrastructure capital to deliver their (retail) services. The most obvious examples include: electricity, natural gas, railways, telecommunications, video programming (such as satellite and cable television), but others involve components of the transportation sector, such as airfields and seaports, as well as waterways, pipelines and aspects of financial intermediation, such as check-clearing networks. The papers in this special issue address a cross section of network industries, including telecommunications, electricity, video programming, and airlines. In addition, the papers are methodologically diverse by design, ranging from analytical/theoretical to empirical/econometric to industry surveys. The general topic of dynamic efficiency within network industries is an important area of research for a number of reasons. First, the long run competitive pricing standard is generally not the sole objective of regulatory authorities. Typically, the regulator strives to balance the public policy goals of encouraging static efficiency (which includes optimally relating prices to marginal costs) and promoting dynamic efficiency, which in part concerns optimal cost-reducing and product development activities. An example of this balancing act is the following. A firm’s incentive to invest in infrastructure is a function of the returns that it expects from this investment relative to other forms of capital accumulation. Hence, regulatory constraints that serve to constrict price-cost margins (to improve static efficiency) may be expected to reduce the returns that a regulated firm could expect from its infrastructure investment, and thereby weaken incentives to improve dynamic efficiency, holding all other factors constant. Conversely, a regulated firm facing pressure on its price-cost margins could be driven to expand infrastructure capital, thereby improving dynamic efficiency to sustain profitability. Also, in a vertically integrated industry context, regulating low access prices

Opportunities for innovation in public transport: Effects of regulatory reforms on innovative capabilities

It is believed that regulatory reforms of public transport could bring about a better quality of service. The expectations are that the regulatory reforms would lead to more innovation in the industry. This article focuses on the role of innovation in the public transport market, and how it is developed. The paper examines different effects of regulatory regimes with respect to innovative capabilities of the public transport services, both in the public and private sectors. Innovative capabilities include the implication of both technological and organisational innovations. Innovation is classified into three areas, namely: technical innovation, competence development and service innovation. In accordance with this classification, this study analyses the relationship between regulation and innovation along with the connection between public authority and private operator. This paper elaborates the theoretical framework derived from the innovation perspective and compares the innovative capabilities that occurred in both the Netherlands and Great Britain.