Original Cost Versus Replacement Cost as a Basis for Rate Regulation

Abstract

Two principles: (1) cost-new, or replacement cost, (2) original cost, 616. — Tendency to adopt replacement cost alone, 617. — Original cost, neglected because thought difficult to ascertain, 618. — How it can be ascertained, 620. — How the principle of replacement cost is in practice departed from, 623. — Both figures should be before the rate-making tribunal, 624. — The problem of investment by later stock-purchasers, 626.