WHY DOES NUCLEAR-POWER PERFORMANCE DIFFER ACROSS EUROPE

This paper compares the performance of nuclear power plants in five Eu ropean countries by estimating a microeconomic model of managerial dec ision making. The statistical formulation of production as a controlle d stochastic process connects economic theory much more closely to act ual production events than standard economic production functions. In this application, the structural behavioral model distinguishes variat ions in economic, regulatory, and cultural environments (different inc entives for plant operations) from technical variations (different pro duction functions). It also estimates the weights that management atta ches to different aspects of performance, such as reliability (safety) and availability (productivity). While any structural model necessita tes debatable assumptions, the approach nevertheless has much to contr ibutes to public policy discussions. The results from 1981-1986 reveal that management attitudes towards the reliability/ productivity trade -off differ substantially between European countries. This suggests th at the incentives of plant managers differ in ways that may not have b een intended or desirable.