Salies, Evens (2005): A Measure of Switching Costs in the GB Electricity Retail Market.
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In most liberalised electricity retail markets, incumbent firms still hold the majority of residential consumers. This situation focused the attention of regulatory institutions and energy economists on the determinants of consumers switching decisions. Fewer studies have, however, been devoted to measuring switching costs. In the present paper we calculate these costs in the Great Britain electricity retail market by revisiting the model suggested in Shy, O. (2002), A quick-and-easy method for estimating switching costs, International Journal of Industrial Organization, 20, pp. 71–87. The average net cost of switching regional incumbents is €385 while the net cost of switching back to them is negative for customers on standard credit or direct debit plans but positive for prepayment customers.
|Item Type:||MPRA Paper|
|Original Title:||A Measure of Switching Costs in the GB Electricity Retail Market|
|Keywords:||Electricity Retail, Switching Costs, Undercut-Proof Property|
|Subjects:||D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D83 - Search; Learning; Information and Knowledge; Communication; Belief
L - Industrial Organization > L9 - Industry Studies: Transportation and Utilities > L94 - Electric Utilities
D - Microeconomics > D4 - Market Structure and Pricing > D43 - Oligopoly and Other Forms of Market Imperfection
|Depositing User:||Evens Salies|
|Date Deposited:||20. Jan 2011 17:08|
|Last Modified:||12. Feb 2013 23:23|
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