IAEE Members and subscribers to The Energy Journal: Please log in to access the full text article or receive discounted pricing for this article.

Rate-of-Return Attrition and Inflation-Induced Penalties in Public Utility Common Stocks

While the rate of inflation seems to be easing, the interest in its impact on corporate security prices (Feldstein, 1980) and on corporate investment policy (Caks, 1981; Higgins, 1977) has continued. Unlike nonregulated firms, utilities face the added difficulties of regulation-induced inflation penalties and return on equity (ROE) attrition.

Purchase ( $25 )

Energy Specializations: Energy Investment and Finance – Corporate Strategy; Electricity – Policy and Regulation

JEL Codes: L94: Electric Utilities, L95: Gas Utilities; Pipelines; Water Utilities, G31: Capital Budgeting; Fixed Investment and Inventory Studies; Capacity, G32: Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill, G11: Portfolio Choice; Investment Decisions, D24: Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity, G12: Asset Pricing; Trading Volume; Bond Interest Rates, D22: Firm Behavior: Empirical Analysis, E31: Price Level; Inflation; Deflation

Keywords: Rate of return attrition, Public utility stocks, Corporate investment policy, Regulation induced inflation penalties

DOI: 10.5547/ISSN0195-6574-EJ-Vol5-No4-6

Published in Volume 5, Number 4 of the bi-monthly journal of the IAEE's Energy Economics Education Foundation.


© 2023 International Association for Energy Economics | Privacy Policy | Return Policy