How Effective Are M&As in Distribution? Evaluating the Government's Policy of Using Mergers and Amalgamations to Drive Efficiencies into Ontario's LDCs

A review of research indicates that few real welfare gains have emerged from the costly effort by the Ontario Government and Regulator to reduce the number of distribution utilities in the province. Significant gains could have been realized without restructuring from improved regulation, with incentives for laggard firms to correct their sub-optimal factor input mix and implement scope-enhancing initiatives.