, Volume 27, Issue 2, pp 123-154

Regulating Service Quality: A Survey

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Abstract

This article reviews the major insights of the economics literature regarding the design of service quality regulation in public utility industries. The focus is on generic service quality issues of primary relevance in the industries, which include the electricity, telecommunications, and water industries. The instruments that public utility regulators commonly employ and the manner in which the regulators employ the instruments to secure desirable levels of service quality are emphasized.

JEL classification: L51, L15
I am grateful to Mark Armstrong, Sanford Berg, Michael Crew, Lynne Holt, Mark Jamison, Lilia Perez-Chavolla, Paul Sotkiewicz, Dennis Weisman, and an anonymous referee for helpful comments and suggestions.