On the Measurement of Capacity Utilization

Nelson, Randy A.

doi:10.2307/2098615

Cited by 104 publications

(52 citation statements)

References 30 publications

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“…To define capital stock one can either use a capacity measure or a cost measure applying the perpetual inventory technique as for example in Nelson (1989). Although the latter method is theoretically more appropriate, we cannot apply it due to the lack of appropriate data.…”

Section: Model Specification and Empirical Implementationmentioning

confidence: 99%

The Cost Structure of Water Utilities in Switzerland

Baranzini

Faust

2009

SSRN Journal

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This paper estimates a translog cost function for Swiss water utilities. From the cost function, we are able to estimate measures of marginal costs as well as economies of production density, customer density and scale, which are important determinants in water policies, such as planning and water tariffs. In order to explore the determinants of water supply costs, their structure and composition, the translog cost function does not only include output and input prices, but further integrates environmental factors such as the proportion of households among customers and water losses. We find moderate returns to production density, which decrease with the size of the utility.

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Section: Model Specification and Empirical Implementationmentioning

confidence: 99%

The Cost Structure of Water Utilities in Switzerland

Baranzini

Faust

2009

SSRN Journal

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“…Capacity utilization represents the proportion of the available capacity that is utilized and is usually measured as a ratio of actual (observed) output to the capacity output, which is the standard approach and is called CU-observed (Morrison, 1985;Nelson, 1989;Tingley, Pascoe & Mardle, 2003;and Felthoven, Horrace, & Schnier, 2009). However, measures of CU based on the numerator being observed output might yield downward-biased estimates of CU, because the observed outputs may not necessarily be produced in a technically efficient manner.…”

Section: Technical Efficiency Capacity Capacity Utilization and Excmentioning

confidence: 99%

Efficiency and Capacity Utilization of India’s Marine Fisheries

Teame

2017

MOS

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For decades, the problems of excess capacity and overfishing have been the subject of considerable attentions, since they are the primary reasons for the depletion of fish stocks, reduction of the profitability and economic performance of the fishery sectors at the national and international levels. As a result, estimations of technical efficiency, harvesting capacity, and capacity utilization has become an increasingly important practice in the fishery, since they provide useful information about the optimum allocation of inputs and outputs, and guide policy formulation to combat biological and economic losses. Based on the Johansen (1968) definition of capacity we have examined the technical efficiency, capacity and capacity utilization of the marine fishery sectors of the India's 9 marine states and 4 union territories using an output oriented data envelopment analysis approach. The result of the study shows that majority of the states/union territories have been inefficient and have the capacity to harvest considerably more than what they have actually been harvesting by using the existing resources in an efficient configuration and showed how serious the problem of excess capacity is in the India's marine fishery.

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“…To define capital stock one can either use a capacity measure as in Filippini (1994) or a cost measure applying the perpetual inventory technique as for example in Nelson (1989). Although the latter method is theoretically more appropriate, we cannot apply it due to the lack of appropriate data.…”

Section: Data Variables and Descriptive Statisticsmentioning

confidence: 99%

Water Supply: Costs and Performance of Water Utilities: Evidence from Switzerland

2008

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In this paper, we assess the economic efficiency of Swiss water utilities. To reach this aim, we accessed a new and unexploited database, which counts 330 water utilities, representing about 55% of the drinking water distributed in Switzerland. The database spans over six years (2000)(2001)(2002)(2003)(2004)(2005) and offers information on the type of the water production process, the characteristics of the network and the costs of water supply. This database presents an original opportunity to analyse the cost of water supply and to determine the efficiency of the water utilities. Such a study has never been done for Switzerland. We apply a stochastic cost function approach to measure cost inefficiency and to investigate the impact of environmental characteristics outside the control of the water utilities (e.g. type of water and customer density) on costs and inefficiency measures. Our results show that environmental factors have a significant influence on costs. Including exogenous variables in the analysis lowers industry inefficiency scores and provides indicators of managerial performance.

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On the Measurement of Capacity Utilization

Cited by 104 publications

References 30 publications

The Cost Structure of Water Utilities in Switzerland

The Cost Structure of Water Utilities in Switzerland

Efficiency and Capacity Utilization of India’s Marine Fisheries

Water Supply: Costs and Performance of Water Utilities: Evidence from Switzerland

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