Ž . Resource and Energy Economics 20 1998 207–224 Productivity development of Norwegian electricity distribution utilities Finn R. Førsund a,b , Sverre A.C. Kittelsen b, ) a Department of Economics, UniÕersity of Oslo, Oslo, Norway b SNF, Foundation for Research in Economics and Business Administration, Oslo, Norway Received 17 October 1995; accepted 29 May 1997 Abstract When regulating electricity distribution utilities, estimates of the past productivity improvement performance are very important for future requirements. A piecewise linear frontier technology, reflecting observed best practice, accommodating the multi-output nature of distribution utilities is specified. A Malmquist index and its components, shift in frontier technology and change in efficiency, have been calculated for the period 1983 to 1989. The main results are a positive productivity growth averaging nearly 2% per year, and that this is mainly due to frontier technology shift. Outliers are scrutinised, but do not influence results for non-outliers. q 1998 Elsevier Science B.V. All rights reserved. JEL classification: C61; D24; L94 Keywords: Electricity distribution; Productivity; Data envelopment analysis; Efficiency 1. Introduction The electricity sector of Norway has undergone rapid changes in the regulatory regime during the last years creating a very market-oriented sector concerning production and consumption of electricity. However, local electricity distribution ) Corresponding author. SNF, Gaustadalleen 21, N-0371 Oslo, Norway. Tel.: q47-22958815; fax: ´ q47-22958825; e-mail: s.a.c.kittelsen@snf.uio.no 0928-7655r98r$19.00 q 1998 Elsevier Science B.V. All rights reserved. Ž . PII S0928-7655 97 00028-6