Valuation And Rate Making the Conflicting Theories of the Wisconsin Railroad Co

Cover Valuation And Rate Making the Conflicting Theories of the Wisconsin Railroad Co
Valuation And Rate Making the Conflicting Theories of the Wisconsin Railroad Co
Robert Lee Hale
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Superior W. L. & P. Co. 1 It would not have suffered it under the actual cost prin- ciple. To adopt reproduction rather than actual cost as the basis would not invariably lessen the risk.
3. Turning now to the argument from analogy, the commission's reasoning is not perfectly clear, but a more complete statement of its logic would seem to be as follows : elements such as the " going value " referred to are the result of earnings anticipated under the present set of rates. Since the inquiry conc
...erns the reasonableness of these very 1 10 W. R. C. R. 704, 739, November 13, 1912.
J37] ANALOGY OF UNREGULATED PROPERTY rates, the values resulting from them cannot be taken as the basis from which to test their reasonableness. On the other hand, such elements as the increment in land values are not the result of the company's earnings, but of " nat- ural growth. " Since earnings on them are permitted in other undertakings, the same rule should apply to utility companies.
The argument as to other undertakings is not conclusive, for items such as " going value, " resulting from the earn- ings of a particular company, are by no means infrequent in the case of companies not subject to rate regulation.


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