Data sets from the U.S. Environmental Protection Agency's
1995 and 2000 Community Water Systems surveys
were used to examine the production costs of water supply
systems. The authors estimate water supply
economies of scale by estimating the elasticities of both
the total unit cost and the individual component costs.
For total unit cost, they found that a 1% production
increase reduced unit costs by a statistically significant
0.16%. For individual component costs, higher
economies of scale in capital, materials, outside services,
and other costs and lower, but still positive, economies of
scale in labor and energy costs were found. These
economies of scale may reflect production economies or
suggest that larger systems are better than smaller systems
at bargaining and receiving services and materials at a
lower unit cost. Importantly, bargaining gains and some
production economies do not necessarily depend on
water systems becoming physically interconnected. Includes 12 references, tables, figures.
| Edition : | Vol. 98 - No. 9 |
| File Size : | 1
file
, 190 KB |
| Note : | This product is unavailable in Ukraine, Russia, Belarus |
| Number of Pages : | 9 |
| Published : | 09/01/2006 |
