Max: > Don't know much about (anything, actually) > electricity, but . . . > > I doubt the relevance of rivalness/excludability > in this context (putting aside enviro/other > externalities). Seems to me the main things > are natural monopoly, oui or non.
Well. I had to take a few courses from the electrical engineering department when I was young although don't remember much after all these years. But still, Diane's argument that electric power in transmission is a quasi-public good sounded fine to me. Indeed, even at the distribution stage the same can be argued based on excludability/rivalry. For this, one has to distinguish between usage and demand. If somehow I manage to use electricity without paying for it, it is pure usage, not demand in economic terms. My usage becomes demand if you can determine how much I used so that you can charge me. People "steal" electricity regularly in Turkey (maybe Patrick Bond would offer some information about a similar phenomenon in South Africa) not only because they cannot pay for it but also because it is very difficult to determine who is stealing how much, although you can determine how much was stolen. And in this market, at least temporally (Or was it inter-temporally or dynamically or whatever? You economists are not only confused but also confusing) supply matches usage, not demand. Best, Sabri
