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on Regulation |
| By: | John Vickers |
| Abstract: | ACE Keynote Lecture, Milan, 16 November 2024 |
| Date: | 2024–12–09 |
| URL: | https://d.repec.org/n?u=RePEc:oxf:wpaper:1057 |
| By: | Martin Peitz; Anton Sobolev |
| Abstract: | A seller can offer an experience good directly to consumers and indirectly through an intermediary. When selling indirectly, the intermediary provides recommendations based on the consumer’s match value and the prices at which the product is sold. The intermediary faces the trade-off between extracting rents from consumers who strongly care about the match value versus providing less informative recommendations but also serving consumers who do not. We analyze the allocative and welfare effects of prohibiting price parity clauses and/or regulating the intermediary’s recommender system. Prohibiting price parity clauses is always welfare decreasing in our model. |
| Keywords: | intermediation, digital platforms, price parity, recommender system, MFN clause, e-commerce |
| JEL: | L12 L15 D21 D42 M37 |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2024_595v2 |
| By: | Hiroaki Suenaga |
| Abstract: | This study examines the sectoral impacts of electricity supply shortages in South Africa, using the cost share information available from the 2015 social accounting matrix. A simulation conducted under each of two technological assumptions, Cobb-Douglas and Leontief, reveals that a productivity decline in the electricity, gas, steam, and hot water supply (EGSH) sector increases the price of the EGSH sector substantially, while it affects the other sectors marginally due to the small cost shares of the EGSH factor in these sectors. |
| Keywords: | Electricity, Computable general equilibrium, Prices, Productivity, Costs, South Africa |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:unu:wpaper:wp-2024-82 |
| By: | Darudi, Ali |
| Abstract: | The Future Electricity Market Model (FEM) is a comprehensive technoeconomic model designed to simulate the investment, dispatch, and trade dynamics within the power systems of Switzerland and Europe. FEM operates as a partial equilibrium model of the wholesale electricity market, minimizing total system costs while adhering to a wide range of technical constraints. It provides projections of capacity mix, hourly prices, generation profiles, storage dispatch, flexible consumption, and cross-border electricity trading across different market areas. The model is formulated as a quadratic programming problem, implemented in Python, and solved using the Gurobi optimizer. With an hourly resolution over a year and a specific focus on the Swiss power system, FEM allows investment decisions solely within Switzerland, while the rest of Europe follows predefined development scenarios. Key features include the modeling of various renewable and conventional energy technologies, integration of storage systems, and incorporation of detailed electricity demand and trade constraints. In order to model the hydro power system more realistically, the model follows a hydro calendar year, i.e., the model starts at the beginning of October. Despite its deterministic approach, assuming perfect foresight, which may introduce an optimism bias, FEM serves as a powerful tool for analyzing the future dynamics of electricity markets under various scenarios. |
| Keywords: | Electricity market, Numerical modelling, Energy |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:306396 |
| By: | Sónia Félix; Ana Fontoura Gouveia |
| Abstract: | Addressing energy poverty and protecting the most vulnerable consumers have assumed a vital role in national and European energy and climate policies. Access to energy is a fundamental pillar of sustainable development due to its impact on multiple dimensions such as poverty, inequality, climate change, food security, health, and education. At the same time, decarbonization and efficiency of energy consumption are essential to achieve the ambitious climate targets assumed by Portugal and the European Union. This paper characterizes energy poverty in Portugal and presents the main policy instruments that have been implemented or are in progress. Sharing national experiences and good practices in combatting energy poverty is relevant due to the challenges in designing effective policies and because several EU countries are currently strengthening their policy frameworks. The need to accelerate the ongoing energy transition on a global scale requires a robust policy framework, also targeting energy-poor and vulnerable consumers, thus ensuring a fair and just transition. |
| JEL: | H50 Q48 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ptu:wpaper:o202401 |
| By: | Ambec, Stefan; Coria, Jessica |
| Abstract: | Public consultations are widely used in regulatory processes, allowing stakeholders to present their viewpoints despite their inherent biases. Some stakeholders, such as firms, are known to be pro-business, while others, such as environmental NGOs, are pro-environment. We develop a framework to analyze how a regulator should process information provided by biased stakeholders. We distinguish between stakeholders whose biases are high and known and those whose biases are small but unknown, such as national authorities. We show that the regulator should follow the advice that runs counter to a stakeholder’s typical bias, i.e., to regulate if firms so advise, and not to regulate if environmental organizations so advise. Without such advice, she should prioritize the comments provided by stakeholders with smaller but unknown bias. Next, we contrast our theoretical results with the regulation of chemicals in the European Union. In line with our theory, we find that support for regulation has a strong and significant impact on the decision to regulate when the support comes from firms but not when it comes from NGOs and environmental agencies. We also find that national authorities have a stronger influence than other stakeholders in the regulation decision, both by the number of comments and the relative support. |
| Keywords: | Environmental policy; incomplete information; cheap talk; biased expertise;; private politics; chemicals, REACH |
| Date: | 2024–12–20 |
| URL: | https://d.repec.org/n?u=RePEc:tse:wpaper:130037 |
| By: | Seiya Hirano |
| Abstract: | This paper studies the relationship between optimal dynamic pricing for network goods and the coordination of consumers' adoption decisions. We show that based on risk dominance criterion, consumers face the risk of coordination failure, and introductory pricing is optimal if the risk is higher in period~1 without network. We find that under threshold coordination, the impact of price on the network size varies according to consumer beliefs. In pessimistic (optimistic) threshold coordination, the network size expands (shrinks) as the price increases. Lowering (Raising) the price in period~2 implies a smaller network size, so introductory (skim) pricing is optimal. |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:dpr:wpaper:1267 |
| By: | Pascal Heid; Kevin Remmy; Mathias Reynaert |
| Abstract: | The transition to electric vehicles (EVs) shifts the complementary market for passenger transport from oil to electricity. We develop and estimate a joint equilibrium model of the German electricity and automobile markets, emphasizing the timing of EV charging, as electricity generation costs and pollution vary intraday. Our results show that under Germany’s current electricity pricing scheme, EVs create a significant pecuniary externality: electricity expenses rise by €0.66 for every €1 spent charging. Exposing charging to wholesale price variation eliminates the pecuniary externality, makes EVs greener, and increases adoption—a triple dividend. |
| Keywords: | electric vehicles, electricity markets, charging, complementary markets |
| JEL: | L5 L6 L9 Q4 Q5 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2024_615 |
| By: | Sebastien Rouillon (Department of Economics, University of Bordeaux) |
| Abstract: | In a context of intense competition for access to the Earth's orbit, we study a model of monopolistic competition in which satellites operators diversify the variety of satellite services. We put this in perspective with the accumulation of in-orbit fragment debris and the risk it poses for the sustainability of orbital activity. Monopolistic competition leads to a sub-optimal outcome, in terms of both the number of satellites in orbit and the range of services offered. We show that monopolistic competition results in excessive orbit congestion, when Earth's orbit carrying capacity is low and/or consumers' preference for diversity is low, and always leads to an insufficient number of satellite services being offered. However, a strong consumers' preference for service diversity, as it increases the market power of satellites operators, can mitigate congestion of the Earth's orbit. |
| Keywords: | Space economics; Orbital debris; Sustainability. |
| JEL: | L1 L9 Q2 |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:bhw:wpaper:02-2024 |
| By: | Gregory M. Dickinson |
| Abstract: | Current consumer-protection debates focus on the powerful new data-analysis techniques that have disrupted the balance of power between companies and their customers. Online tracking enables sellers to amass troves of historical data, apply machine-learning tools to construct detailed customer profiles, and target those customers with tailored offers that best suit their interests. It is often a win-win. Sellers avoid pumping dud products and consumers see ads for things they actually want to buy. But the same tools are also used for ill -- to target vulnerable members of the population with scams specially tailored to prey on their weaknesses. The result has been a dramatic rise in online fraud that disproportionately impacts those least able to bear the loss. The law's response has been technology centric. Lawmakers race to identify those technologies that drive consumer deception and target them for regulatory restrictions. But that approach comes at a major cost. General-purpose data-analysis and communications tools have both desirable and undesirable uses, and uniform restrictions on their use impede the good along with the bad. A superior approach would focus not on the technological tools of deception but on what this Article identifies as the legal patterns of digital deception -- those aspects of digital technology that have outflanked the law's existing mechanisms for redressing consumer harm. This Article reorients the discussion from the power of new technologies to the shortcomings in existing regulatory structures that have allowed for their abuse. Focus on these patterns of deception will allow regulators to reallocate resources to offset those shortcomings and thereby enhance efforts to combat online fraud without impeding technological innovation. |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2412.19850 |
| By: | Brüll, Eduard; Rostam-Afschar, Davud; Schlenker, Oliver |
| Abstract: | We study how the threat of entry affects service quantity and quality of general practitioners (GPs). We leverage Germany's needs-based primary care planning system, in which the likelihood of new GPs reduces by 20 percentage points when primary care coverage exceeds a cut-off. We compile novel data covering all German primary care regions and up to 30, 000 GP-level observations from 2014 to 2019. Reduced threat of entry lowers patient satisfaction for incumbent GPs without nearby competitors but not in areas with competitors. We find no effects on working hours or quality measures at the regional level including hospitalizations and mortality. |
| Keywords: | Entry regulation, general practitioners, healthcare provision, threat of entry, regression discontinuity design |
| JEL: | I11 I18 J44 J22 L10 L22 R23 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:glodps:1537 |
| By: | Giovanazzi, Carmen |
| Abstract: | We analyze the dynamics of mergers and acquisitions (M&A) in the United States (US) and Germany in the 2000s, drawing on the Varieties of Capitalism (VoC) framework and the concept of internal capitalist diversity. Using SDC Platinum transaction data from 2000 to 2023 and qualitative insights from semi-structured interviews with 28 M&A professionals, we investigate how firm characteristics and institutional frameworks drive M&A activity in both countries. We confirm VoC-based expectations regarding transaction volumes and industry patterns but also highlight the professionalization of M&A functions across large, listed firms, alongside an increasing role of financial acquirers in both markets. While the rise of private equity aligns with the exit-driven strategies of small and medium-sized enterprises (SMEs) in the US, it raises questions regarding family-owned SMEs in Germany, which prioritize continuity and legacy but increasingly face succession challenges. Our findings suggest a continued hybridization of Germany's stakeholder-oriented corporate governance, integrating shareholder-oriented practices beyond large, listed firms. |
| Keywords: | M&A, Varieties of Capitalism, Financialization, Germany, US |
| JEL: | G34 L2 P52 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:ifsowp:308062 |
| By: | Anderlik, Jasmin (Ministry of Labor and the Economy (Vienna)); Jumaniyozova, Malika (Johannes Kepler University Linz); Schmidpeter, Bernhard (Vienna University of Economics and Business); Winter-Ebmer, Rudolf (Johannes Kepler University Linz) |
| Abstract: | Using linked vacancy-employer-employee data from Austria, we investigate how monopsony power affects firms' posting behavior and wage negotiations. Consistent with theoretical predictions, we find that firms with greater monopsony power post lower wages and offer fewer non-wage amenities, suggesting that wages and non-wage benefits are complementary. However, we find no evidence that monopsonistic firms demand higher levels of skill or education. Instead, our results indicate that they require more basic skills, particularly those related to routine tasks. On the workers' side, we find that employees hired in monopsonistic labor markets face significantly lower wages, both initially and in the long run. These lower wages are driven by both lower posted wages and reduced bargaining power, as well as reduced opportunities to climb the wage ladder later. |
| Keywords: | monopsony, wages, bargaining, upskilling |
| JEL: | J12 J16 J13 J22 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17585 |