A number of the reports that First Economics has written over the last three years are available for download. May 2010 - Frontier shift First Economics has published a report on the subject of frontier shift. It looks at the analysis that has been carried out since we first questioned why it was that regulators were assuming that regulated companies should be expected to go on reducing opex in real terms indefinitely. It also highlights a number of areas where we think that further work is still required. The report can be accessed here.  April 2010 - Financeability First Economics is today publishing a new report on the subject of financeability. It questions the proposition that companies which fail regulators' financeability tests should be expected to raise new equity and argues instead that NPV-neutral advancement of revenue is the most appropriate regulatory response to weak financial ratios. The report can be accessed here.  March 2009 - Relative Risk and the Estimation of Beta The CAA has published a report by First Economics on the estimation of beta. The report is an input into the CAA's review of NATS' price control and aims to show how it is possible to obtain an estimate of NATS' riskiness in the absence of share price data. June 2007 - Automatic Indexation of the Cost of Capital This paper examines the proposition that regulators should index their cost of capital allowances in line with the prevailing risk-free rate and/or cost of debt. (Update, 27 March 2008: In a consultation paper published today Ofwat has accepted the arguments put forward in this paper. This follows similar endorsements from the Competition Commission, the CAA and ORR) April 2007 - Frontier Shift First Economics has produced a new report on the rate of 'frontier shift' affecting regulated companies' costs. We argue that regulators should not expect regulated companies to go on reducing operating expenditure in real terms indefinitely, and suggest that asking companies to hold costs in line with RPI is a sufficient challenge. Our report can be found on Ofgem's website and here April 2007 - Treatment of Capex Overspends Water UK recently asked us to undertake a short study into the way that a regulator should deal with a company that invests more than assumed at the time of a periodic review. Our report can be accessed here. December 2005 - Efficiency This briefing paper examines the influence that changes in the drivers of inflation are having on regulated companies' ability to meet efficiency targets. The paper shows that a sharp slowdown since 1999 in the rate of inflation affecting goods such as food, clothing and motor vehicles has helped maintain RPI-measured inflation at 2.5% despite an acceleration in inflation across the rest of the economy. We argue that it is now more difficult for companies to hold opex in real terms and suggest that the productivity improvements that must be delivered in order to meet regulators' targets might have increased. April 2005 - Financeability This briefing paper examines why regulators across the UK utility sector have been discovering that the conventional 'building block' model of price setting does not always make regulated companies financeable in the perception of investors and rating agencies - and why allowing firms returns in excess of the cost of capital may not necessarily be the best way to deal with the problem. August 2004 - The 2006 Royal Mail Price and Service Quality Review Following the publication of Postcomm's initial consultation paper in its review of Royal Mail, First Economics produced a report analysing the main issues that the regulator would be addressing during the course of the review. Our report can be accessed here May 2004 - Submission to the DfT Rail Review In the run up the publication of the government's 2004 Railway White Paper, First Economics was commissioned to produce a report setting out what we saw as the key issues for the government to address. Our submission can be accessed here