Policy reforms and productivity change in the Dutch drinking water industry: A time series analysis 1980-2015

In the last four decades, the Dutch drinking water industry has undergone two major policy reforms, namely the consolidation of the industry by stimulating mergers and the introduction of yardstick competition by applying benchmarks. This paper addresses the question of whether these two instruments have improved productivity. Productivity changes are derived from an estimated cost function. The effects of average scale as well as the introduction of a form of yardstick competition on productivity are formally tested. Estimation is conducted on the basis of time series data in the period 1980-... Mehr ...