support systems for the diffusion of renewable energy technologies an investor perspective concern over climate change impacts and the projected depletion of fossil fuels has urged more governments to adopt policies that stimulate the diffusion of renewable energy technologies ret with an increasingly diverse suite of support instruments the question emerges as to which instruments or combinations are able to achieve faster more substantial diffusion results although various support instruments were extensively addressed in policy studies there is still no consensus this is partly because many policy studies take a policy maker approach in comparing support instruments leaving relationships between policy design and policy results as a black box this paper proposes an investor oriented perspective to analyze the diffusion potential of support systems for ret the main argument is that it is not the type of support instrument but rather its risk profitability characteristics that influence investor behavior and the rate of diffusion the two instruments most frequently discussed and compared are the feed in tariff and the quota model the analysis in this paper concludes that policy design is crucial while often feed in tariffs are applauded and quota system feared feed in tariffs may also bring about disappointing diffusion results when poorly designed while quota systems may be also conceived as attractive instruments for independent power producers

energy security and renewable electricity trade will desertec make europe vulnerable to the energy weapon abstract solar power imports to europe from the deserts of north africa as foreseen in the desertec concept is one possible way to help decarbonising the european power sector by 2050 however this approach raises questions of threats to european energy security in such an import scenario particularly in the light of increasing import dependency and russia s use of the energy weapon in recent years in this paper we investigate the threat of north african countries using the desertec electricity exports as an energy weapon we develop and use a new model to assess the interdependence the bargaining power symmetry operationalised as costs of a disruption in a future renewable electricity trade between north africa and europe if europe maintains current capacity buffers some demand response capability and does not import much more than what is described in the desertec scenario it is susceptible to extortion and political pressure only if all five exporter countries unite in using the energy weapon europe is not vulnerable to extortion by an export cut from only one country as the european capacity buffers are sufficient to restore the power supply no single exporter country would have sustained bargaining power over europe

specifying the dynamics of industry concentration previous studies generally explain changes in concentration by its initial determinants or by changes in its determinants little attention is paid to the dynamic structure of the model this study provides a framework to sort out adjustment effects in a systematic manner the empirical model distinguishes long term from short term effects and estimates the rate of adjustment when concentration deviates from its long term equilibrium level considerable attention has focused on industry concentration as a key element of market structure while earlier empirical studies examined determinants of the level of industry concentration a more recent literature focuses on changes in concentration these more recent papers typically explain intertemporal changes in concentration by the past levels of industry growth concentration advertising intensity and minimum efficient plant size however the dynamic relationship between changes in concentration and the levels of the independent variables has not been explicitly specified caves and porter 1980 have argued that explaining changes in concentration by past levels of market structure variables is tantamount to assuming that the sampled industries are in the process of adjusting to a disequilibrium situation as an alternative they adopt a long term equilibrium approach whereby changes in concentration are explained by lagged changes in the relevant market conditions they find that this approach as a whole was unsuccessful exhibiting low levels of significance and a lack of robustness when the cross section regressions were shifted to different time periods

comparing carbon capture and storage ccs with concentrating solar power csp potentials costs risks and barriers abstract coal power coupled with carbon dioxide capture and storage ccs and concentrating solar power csp technologies are often included in the portfolio of climate change mitigation options intended to decarbonize electricity systems both of these technologies can provide baseload electricity are in early stages of maturity and have benefits costs and obstacles we compare and contrast ccs applied to coal fired power plants with csp at present both technologies are more expensive than existing electricity generating options but costs should decrease with large scale deployment especially in the case of csp for ccs technological challenges still remain storage risks must be clarified and regulatory and legal uncertainties remain for csp current challenges include electricity transmission and business models for a rapid and extensive expansion of high voltage transmission lines the need for international cooperation may impede csp expansion in europe

product market competition and the impact of price uncertainty on investment some evidence from us manufacturing industries the authors estimate the impact of price uncertainty on investment using a panel of u s manufacturing industries pooling the data for all industries uncertainty has no impact on current investment however for industries that have low levels of seller concentration and thus are likely to be highly competitive the estimated impact is negative and statistically significant while for industries with high levels of seller concentration the impact is always small and not significantly different from zero the finding of a negative relationship between investment and price uncertainty in competitive industries is broadly consistent with models that incorporate irreversibility of capital investment copyright 1996 by blackwell publishing ltd

electricity planning and implementation in sub saharan africa a systematic review abstract universal electricity access is an important development objective and the focus of a number of key global un initiatives while robust electricity planning is widely believed to be a prerequisite for effective electrification to date no comprehensive overview of electricity planning research has been undertaken on sub saharan africa the world region with the lowest access rates this paper reviews quantitative and qualitative electricity planning and related implementation research considering each of the 49 sub saharan african countries the four regional power pools and the sub continent as a whole applying a broad understanding of electricity planning and a practical limit of 20 reviewed articles per country and region 306 relevant peer reviewed journal articles are included in this review a general classification scheme is introduced that classifies the planning literature along the addressed value chain depth number of different analysed criteria and number of evaluated decision alternatives the literature is found to be strongly clustered in a few countries with less than 5 identified relevant articles in 36 of the 49 countries the total amount of articles per year is clearly increasing over time addressing technology choice operation distribution and implementation analyses although including different high level criteria in analysing electricity systems is common the literature is only starting to use formalised multi criteria decision making mcdm tools the review indicates that 63 of relevant articles favour renewable energy technologies for their given problems frequently mentioned success factors for electrification in sub saharan africa include adequate policy design sufficient finance and favourable political conditions while considerable regional and methodological literature gaps are apparent the literature in this review identifies a rich and fruitful ground for future research to fill these gaps

oil prices the role of refinery utilization futures markets and non linearities we test the hypothesis that real oil prices are determined in part by refinery capacity non linearities in supply conditions and or expectations and that observed changes in these variables can account for the rise in prices between 2004 and 2006 results indicate that the refining sector plays an important role in the recent price increase but not in the way described by many analysts the relationship is negative such that higher refinery utilization rates reduce crude oil prices this effect is associated with shifts in the production of heavy and light grades of crude oil and price spreads between them non linear relationships between opec capacity and oil prices as well as conditions on the futures markets also account for changes in real oil prices together these factors allow the model to generate a one step ahead out of sample forecast that performs as well as forecasts implied by far month contracts on the new york mercantile exchange and is able to account for much of the 27 rise in crude oil prices between 2004 and 2006

powering africa meeting the financing and reform challenges africa faces chronic power problems including insufficient generation capacity low connectivity poor reliability and high costs all of which constrain development power capacity additions in sub saharan africa excl sa since the 1990 s were minuscule historically investments in the power sector in africa have come mostly from governments or public utilities with foreign aid support in recent years these sources of funding have been flat the fastest new sources of funding are from independent power producers ipps and from china to understand the determinant of the new sources the paper analyses the effect of several key factor and find non expected results such as there is no obvious correlation between unbundling or the presence of an independent regulator and the level of private investment through ipps or that there is no correlation between chinese investment in generation and resource rich countries dispelling the myth that chinese firms are only interested in africa s resources the paper delivers several recommendations that indicate that more attention needs to be given to issues related to planning procurement and contracting as well as securing revenue flows jel classification o13 o25 l94

on the identification of cointegrated systems in small samples a modelling strategy with an application to uk wages and prices abstract this paper discusses the practical application of identification in cointegrated systems it will argue that in a common realistic modelling situation of a limited data set and the theory requirements of a fairly rich model the techniques proposed in the existing literature are almost impossible to implement successfully there are crucial decisions to be made over the order in which various restrictions are imposed in the move from a general unrestricted vector error correction model vecm to the fully over identified vecm we will argue that imposing exogeneity restrictions at the earliest possible stage of the model reduction process and then restricting the dynamic adjustment of the model hugely increases the power of tests of overidentifying restrictions on the long run cointegrating vectors in practice this means that a thorough use of economic theory at an early stage rather than treating a model as a pure statistical artefact can yield enormous benefits

in praise of the old i o abstract old i o is the body of empirical regularities obtained by cross section statistical methods following their introduction by bain bain 1951 relation of profit rate to industry concentration american manufacturing 1936 1940 quarterly journal of economics 65 293 324 its researchers did not seek to fit particular theoretical oligopoly models to market data apart from theoretical conditions for sustainable collusion but they did establish a large number of empirical regularities cross section associations between dimensions of performance allocative efficiency productive efficiency turnover of suppliers in markets and their structural and behavioral features these associations continue to serve a wide range of uses for economic understanding and policy formation

oil and the macroeconomy since world war ii all but one of the u s recessions since world war ii have been preceded typically with a lag of around three fourths of a year by a dramatic increase in the price of crude petroleum this does not mean that oil shocks caused these recessions evidence is presented however that even over the period 1948 72 this correlation is statistically significant and nonspurious supporting the proposition that oil shocks were a contributing factor in at least some of the u s recessions prior to 1972 by extension energy price increases may account for much of post opec macroeconomic performance

independent power projects in sub saharan africa investment trends and policy lessons abstract sub saharan africa is in urgent need of more power private sector investment is key to achieving this along with chinese funded projects independent power projects ipp represent the fastest growing sources of power investment in sub saharan africa ipp investment flows show little concern for electricity market structures but are more likely to gravitate to countries with strong planning procurement and contracting capacity as well as good regulatory quality data from the continent also shows a variety of ownership and financing structures for ipps but generally development financing institutions dfis play an important part in mitigating risk and bringing in private financiers we also see renewable energy breaking through on the continent both in scale and price this breakthrough is in part being facilitated by competitive procurement or auctions which deliver lower prices and increased transparency when compared with renewable energy feed in tariffs or directly negotiated contracts these developments have important policy implications highlighting the need for dynamic least cost planning linked to the timely initiation of the competitive procurement of new generation capacity the building of effective regulatory capacity and appropriate risk mitigation mechanisms such efforts promise to promote sustainable economic and social development across the continent

what do we learn from the price of crude oil futures summary despite their widespread use as predictors of the spot price of oil oil futures prices tend to be less accurate in the mean squared prediction error sense than no change forecasts this result is driven by the variability of the futures price about the spot price as captured by the oil futures spread this variability can be explained by the marginal convenience yield of oil inventories using a two country multi period general equilibrium model of the spot and futures markets for crude oil we show that increased uncertainty about future oil supply shortfalls under plausible assumptions causes the spread to decline increased uncertainty also causes precautionary demand for oil to increase resulting in an immediate increase in the real spot price thus the negative of the oil futures spread may be viewed as an indicator of fluctuations in the price of crude oil driven by precautionary demand an empirical analysis of this indicator provides evidence of how shifts in the uncertainty about future oil supply shortfalls affect the real spot price of crude oil copyright 2010 john wiley sons ltd

greening africa technologies endowments and the latecomer effect abstract africa is well endowed with potential for hydro and solar power but its other endowments shortages of capital skills and governance capacity make most of the green options relatively expensive while its abundance of hydro carbons makes fossil fuels relatively cheap current power shortages make expansion of power capacity a priority africa s endowments and the consequent scarcities and relative prices are not immutable and can be changed to bring opportunity costs in africa closer to those in the rest of the world the international community can support by increasing africa s supply of the scarce factors of capital skills and governance

financing renewable energy in africa key challenge of the sustainable development goals abstract given the challenge of offering a development perspective to a rapidly growing population it might be tempting for africa to pursue a strategy of fueling growth with the cheapest source of energy available and take care of the environment later such an approach however would disregard the social cost of fossil fuels which the population would have to bear using the sustainable development goals as a benchmark for inclusive and sustainable growth we identify the synergy effects provided by renewable energy already substantial efforts of financing the additional cost of re are under way an analysis of possible leverage points available instruments and involved actors shows that there remains a large additional potential

which oil shocks really matter in equity markets abstract this paper examines the relationship between structural oil shocks and us equity markets the recent oil shock decomposition of ready 2018 is reconsidered and refined providing a clearer delineation between shocks to equity market discount rates and aggregate demand leading to an oil shock specification which attributes substantially more explanatory power to the latter in explaining equity market variation providing links with the literature dating back to kilian and park 2009 an explicit role is given to precautionary demand shocks using an independent measure constructed from oil futures data reducing the role of the supply shocks obtained as the final residual in the recursive identification scheme in an extended sample that allows an analysis of the oil equity market relationship since the global financial crisis the modified aggregate demand shocks have approximately twice as much explanatory power for stock return variation than the demand shocks of ready 2018 the importance of these shocks in driving oil price changes and equity market volatility has only increased since the financial crisis with the role of supply shocks diminishing once these demand effects are accounted for there is little relationship between precautionary demand shocks and equity returns in contrast to the existing literature

testing uncertainty s effect in real options with multiple capital goods the irreversible investment theory with heterogeneous capital predicts a negative relationship between uncertainty and the investment extensive margin we empirically explore this prediction using plant level data for investment across multiple fixed assets and employ a discrete ordered choice model our results indicate that uncertainty even after controlling for financial constraints induces a negative effect on the extensive margin thereby decreasing the likelihood of investment triggering in more types of capital this effect takes the form of both a higher probability of investment inactivity but also a lower probability of investment triggering in a higher number of capital types

sunk costs and cartel formation theory and application to the dyestuff industry we first develop a simple model of entry showing that cartels are more likely to emerge during periods of downturns and in industries with significant sunk costs cartel formation is also accompanied by a decline in profits we then use the framework to investigate the emergence of the swiss dyestuff export cartel during the inter war period and find empirical evidence that supports the main predictions of the model the analysis indicates that sunk costs and entry may be important determinants of cartel formation and are complementary to the traditional cartel stability conditions

the cost of providing electricity to africa abstract sub saharan africa lacks electricity we estimate the cost of providing electricity to the region to do so we build an optimisation model that links the electricity demand to the supply and links the supply to the generation distribution and transmission of electricity between countries to the best of our knowledge such a model is novel in the literature we determine that the investment cost of providing electricity to sub saharan africa over a 10 year period is between 160 and 215 billion u s dollars depending on assumptions for electricity access and the cross country electricity trade although the electricity trade increases the investment cost estimate moderately it provides a high return to african countries and is cost efficient overall

oligopoly power in the food and tobacco industries in this article we estimate and test for the degree of oligopoly power and economies of scale in forty food and tobacco industries using the new empirical industrial organization neio framework and four digit sic data lerner indices and elasticities of scale are compared throughout the entire food and tobacco industries t tests verify that all but three of these industries exert statistically significant degrees of oligopoly power and that over 82 of these industries exhibit nonconstant returns to scale the empirical results also provide estimates of the price elasticities of demand for each industry

hysteresis and export targeting abstract a direct and largely untested implication of hysteresis concerns the extent of market entering and leaving in response to large movements in exchange rates this note examines for 359 4 digit u s sic industries data on the distribution of u s exports by country of destination a proxy for the number of markets served from 1978 to 1987 and relates changes in these distributions to overall exchange rate movements we seek to explain differences in the response across industries on the basis of differences in sunk costs the empirical results are generally consistent with the hysteresis approach while in periods of general dollar depreciation firms spread exports more widely across foreign markets this effect is seen to be limited in industries with relatively large distribution and media advertising costs for which much of the costs of establishing export networks may be sunk

oil and the macroeconomy since the 1970s economists have long been intrigued by empirical evidence that suggests that oil price shocks may be closely related to macroeconomic performance this interest dates back to the 1970s the 1970s were a period of growing dependence on imported oil unprecedented disruptions in the global oil market and poor macroeconomic performance in the united states thus it was natural to suspect a causal relationship from oil prices to u s macroeconomic aggregates since then a large body of work has accumulated that purports to establish this link on theoretical grounds and to provide empirical evidence in its support we do not attempt a comprehensive survey of this literature but rather provide an idiosyncratic synthesis of what we view as the key issues in this debate and the insights gained over the last 30 years the timing seems right for such an account although the experience of the 1970s continues to play an important role in discussions of the link between oil and the macroeconomy there have been a number of new oil price shocks since the 1970s notably the 1986 collapse of oil prices and the 2000 boom in oil prices as well as the oil price increases associated with the 1990 1991 gulf war and the 2003 iraq war given this richer case history we are arguably in a better position than two decades ago to distinguish the idiosyncratic features of each oil crisis from the systematic effects increases in oil prices have been held responsible for recessions periods of excessive inflation reduced productivity and lower economic growth in this paper we review the arguments supporting such views first we highlight some of the conceptual difficulties in assigning a central role to oil price shocks in explaining

addressing the renewable energy financing gap in africa to promote universal energy access integrated renewable energy financing in malawi abstract the sustainable energy for all initiative is a global initiative launched by the united nations secretary general in 2012 with a goal of providing universal access to modern energy services by 2030 to achieve this goal substantial financial and technological investments will be required at a rate far exceeding historical levels sub saharan africa has a 30 5 electrification rate and policy reform issues to improve electrification have been poorly implemented thereby sprinkling doubt as to whether the region would be able to achieve 100 access to electricity for all by the year 2030 sub saharan africa faces a tough challenge in order to achieve universal access to modern energy services since the region fails to attract energy sector investments there is also a general perception that the region contributes very little to global greenhouse gas emissions hence offers few opportunities to reduce these emissions consequently missing out on attracting climate finance projects a guarantee of power purchase has been shown to attract energy sector investments however guarantees of power purchases such as feed in tariffs are experiencing slow market growth in developing countries because of a range of technical regulatory and financial barriers using malawi as a case study of a developing country this review provides a perspective from a sub saharan africa least developed country as to the various electrification renewable energy deployment and climate change management challenges that still require urgent attention this study shows that despite the perceived regulatory and financial challenges malawi can integrate and use a combination of adapted price guarantee schemes cross subsidies and environmental taxes in order to support initiatives aimed at supporting the country s development of renewable energy sources and hence indirectly support the sustainable energy for all initiative

opec behavior a test of alternative hypotheses since interpretations of past and future oil price patterns depends on the model chosen the author tests and compares alternative theories of opec as a first step in validating the choice on any one model the results show that among opec countries the partial market sharing cartel model is the only model not rejected by at least some of the 11 members and gives the best explanation of production in comparison with 11 non opec countries the competitive model could not be rejected for 10 of the 11 non opec producers this raises the question of why if opec is a cartel friedman s predictions have not come true and introduces new questions for future research 19 references 3 tables

recent drivers of the real oil price revisiting and extending kilian s 2009 findings abstract we replicate and update the results of kilian 2009 to include the period since the financial crisis we separate the drivers of the price of crude oil shocks into three components oil supply shocks aggregate demand shocks and oil market specific demand shocks we provide evidence that the run up of oil prices in 2008 was mostly driven by aggregate demand shocks and to a lesser extend by oil market specific demand shocks complementing similar analyses in baumeister and kilian 2016a and kilian 2017 our results confirm that the cumulative effect of aggregate demand disruptions on the price of crude oil started before 2007 furthermore aggregate demand shocks and oil market specific demand shocks rather than oil supply shocks have the most significant effects on u s output and prices the findings are robust to an alternative measure of global real economic activity

investment in greek manufacturing under irreversibility and uncertainty the message in used capital expenditures this article contributes to the existing literature by showing that uncertainty produces a nonuniform impact to the extent that different types of capital goods exhibit heterogeneous irreversibility which we define as asset specific irreversibility hence asset specific irreversibility is responsible for asymmetries in responses across types of capital goods to uncertainty we also show that for a given type of capital good uncertainty produces a variety of responses across sectors which we define sector specific irreversibility in other words sectoral differences in terms of the ability to substitute a given type of capital with labour introduce a second order effect of uncertainty on investment

global policy of rural electrification energy poverty and lack of electricity in the rural area exacerbate the poverty of the developing countries the sustainable renewable technologies can be considered as efficient tools to reduce energy poverty whenever they are conducted based on an appropriate policy electricity can improve the human s lifestyle by increasing the level of health education welfare and technology currently sub sahara africa with only 14 2 of rural electrification has the first rank in the world with lowest access to electricity in that region around 585 million citizens has almost no access to electricity the present study focuses on the general global policies to electrify the rural areas in this regard variety of plans and programs conducted by governmental and private institutes are investigated in the year 2011 the international energy agency iea has developed three global strategies based on the world energy market that defines the overall world energy approach in the present work different technologies for rural electrification are taken into account in two major categories of grid connected and off grid systems furthermore based on sustainable development with emphasis on environmental consideration the feasibility of electrification by using different types of renewable energies such as solar biomass hydro wind and wave have been studied despite reliability of grid connection results indicate that renewable energy sources are the best choice especially in areas far from grid connections challenges between financial institutes and executive agencies result in resource management and technology development in order to overcome existing barriers and issues

market concentration contestability and sunk costs this paper provides an exploratory assessment of the theory of contestability that is based on a diverse sample of industries and introduces a new important determinant of market concentration the results of the paper indicate that the variables determining the degree of contestability of markets are significant correlates of market concentration sunk costs account for a substantial portion of the sample variance of concentration even after technological factors are controlled for copyright 1990 by mit press

electricity supply and demand scenarios for the southern african power pool abstract the study presents long term electricity supply and demand scenarios for the twelve countries in the southern african power pool based on detailed bottom up demand analysis for all countries and a set of internally consistent development scenarios total regional electricity demand and supply increase by eight to fourteen times from 2010 to 2070 with major shifts in both the sectoral composition of demand and the geography of demand with south africa becoming a much smaller share on the supply side the fuel mix shifts from coal and toward hydro in the medium term but towards other renewables such as solar in the longer term particularly in the scenarios with the fastest decline in capital costs for renewables this leads to declining unit carbon dioxide emissions in the more aggressive scenarios even though total power sector emissions still increase the unit cost of generation for the entire region is stable across all scenarios the potential transformation of the supply sector would require a fundamental shift in resource use grid management and infrastructure development in the region as well as greater regional integration this also implies significant institutional capacity development in the sapp coordination centre or similar structures for cooperative management of resources

co2 mitigation potential of ccs in china an evaluation based on an integrated assessment model abstract carbon capture and storage ccs has been viewed as an emission abatement option with great potential in china as coal has dominated china s energy consumption china has already started to pay attention to ccs as well as to the proposed the concept of ccus which adds co 2 utilization into the chain of capture transportation and storage however ccs is still in the early stages of its technological development and the high cost with several internal and external uncertainties make the role that ccs can play in china s future emission reduction unclear from the perspective of general equilibrium analysis this paper introduces ccs into a regional energy economy environment integrated assessment model and makes a comprehensive evaluation of ccs s potential for future development and contribution to emission abatement in china at climate policy level the potential contribution of ccs in emission abatement has been evaluated against different future emission constraint scenarios in china at technological level the effects of endogenous learning and policy incentives on ccs have been investigated and the substitution capacities of ccs and non hydro renewables to fossil energy have been discussed as well as their technology penetration rates furthermore the impact of co 2 utilization on the development of ccs has also been discussed

the impact of learning by doing on the timing and costs of co2 abatement abstract a particular ceiling on atmospheric co 2 concentrations can be maintained through a variety of emission pathways over the past decade there has been considerable debate over the characteristics of a least cost pathway some have suggested that a gradual departure from the emissions baseline will be the most cost effective because it reduces the pressure for premature retirement of the existing capital stock and it provides valuable time to develop low cost low carbon emitting substitutes others counter that a major flaw in analyses that support this line of reasoning is that they ignore learning by doing lbd in this paper we examine the impact of lbd on the timing and costs of emissions abatement with regard to timing we find that including learning by doing does not significantly alter the conclusions of previous studies that treated technology cost as exogenous the analysis supports the earlier conclusion that for a wide range of stabilization ceilings a gradual transition away from the no policy emissions baseline is preferable to one that requires substantial near term reductions we find that the major impact of including learning by doing is on the costs of emission abatement depending upon the sensitivity of costs to cumulative experience lbd can substantially reduce the overall costs of emissions abatement

time and frequency connectedness among oil shocks electricity and clean energy markets abstract this paper examines the time and frequency connectedness among electricity carbon and clean energy markets and oil price demand and supply shocks in doing so we use the spillover method proposed by diebold and yilmaz 2012 and its extension in the frequency domain by barunik and k ehlik 2018 we find increased connectedness during the global financial crisis as well as in the shale oil revolution period the total connectedness is also higher in the short run compared to the long run due to their low connectedness electricity futures can act as a risk diversifier and safe haven asset against oil shocks net pairwise directional connectedness among oil shocks and the clean energy index is higher during the shale oil revolution these results have important implications for investors with different investment time horizons

oil demand shocks reconsidered a cointegrated vector autoregression abstract we reconsider the conclusions about the importance of oil demand shocks and the unimportance of supply shocks reported by kilian 2009 we investigate whether the proxy for worldwide real economic activity dry bulk maritime freight costs represents anything more than transportation costs by analyzing the relation between these costs and oil prices the meaning of this variable is critical because transportation costs appear on both sides of the equations estimated by kilian directly as dry bulk maritime freight costs and as part of the measure for oil prices we also investigate the effects of representing oil supply with an aggregate of opec and non opec production because they likely use different criteria to chose output finally we investigate kilian s use of the first difference of supply while the other variables in his model are represented as levels the results suggest that opec and nonopec nations use different criteria to set output and that reductions increases in opec production raise lower oil prices the elements of the cointegrating relations their loadings and impulse response functions suggest that the positive relation between dry bulk maritime freight costs and oil prices simply represents the effect of higher oil prices on transportation costs sensitivity analyses suggest that these differences are caused by including transportation costs in the measure of oil prices aggregating opec and non opec productions and using a very long lag length to estimate the var together these results suggest that conclusions about the importance of demand shocks and the unimportance of supply shocks are not robust to alternative specifications that are consistent with many empirical findings about the world oil market

the landscape of energy initiatives in sub saharan africa going for systemic change or reinforcing the status quo abstract this article examines recent interventions by major players in sub saharan africa s energy sector and asks whether they acknowledge or seek to address energy as a complex problem and energy systems as socio technical systems several scholars have begun advocating the socio technical approach to energy by noting that the mainstream conceptualization of energy challenges in strictly technological or economic terms does not capture the complexity and inertia inherent to energy systems moreover the article also seeks to examine how well have recent interventions integrated pro poor and low carbon concerns two of the major tenets of un s sustainable development goal 7 findings suggest that initiatives studied take only partial consideration of key aspects of a socio technical approach to the energy problem nonetheless the initiatives have taken on board pro poor and low carbon concerns to a certain extent two main policy implications are drawn from this study a continued focus on status quo approaches has the potential to generate investment inefficiencies and an effective low carbon transition will require a broader discussions about the types of lifestyles people in sub saharan africa aspire to

u s equity and commodity futures markets hedging or financialization abstract in this paper we investigate the hedging versus the financialization nature of commodity futures vis a vis the equity market using a arma filter based correlation approach our results suggest that while gold futures are typically seen as a hedge against unfavorable fluctuations in the stock market the majority of commodity futures appears to be treated as a separate asset class in line with their increasing financialization our results are robust to the presence of inflation highlight the hedging role played by fuel energy commodity futures in the nineties and reveal that the commodity financialization boosted since the 2000s we also show that gold futures are partially a safe haven for equity investments in the short term but not in the mid term finally we uncover some hedging financialization of crude oil futures associated to global demand oil supply shocks

economic assessment of concentrated solar power technologies a review abstract this paper surveys economic assessments of concentrated solar power csp technologies and finds two dominant assessment methods a majority of studies reported in the literature are based on the levelized cost of electricity lcoe while a small subset of studies consider time varying meteorological and electricity market conditions several studies argue that lcoe undervalues dynamic flexibility provided by thermal energy storage and does not consider revenue opportunities provided by electricity markets at different time scales as a result some studies find that both lcoe and revenue can in fact be conflicting metrics for certain designs and market conditions this review finds strong variations in lcoe and revenue estimates in the literature as comparisons between csp and other generation technologies e g fossil wind and photovoltaic are dictated by the chosen economic metric it is imperative that policy and investment decisions should carefully consider time varying effects and flexibility finally research directions are proposed to increasing the fidelity of economic assessments and to mitigate discrepancies

an income strategy approach to the positive theory of accounting standard setting choice abstract this paper is designed to provide additional evidence on the positive theory of accounting policy choice by combining individual accounting principles into firm income strategies these strategies were the dependent variable in a probit analysis where the independent variables were size management compensation industry concentration ratio systematic risk capital intensity and the total debt to total asset ratio the results indicate that four of these factors size management compensation concentration ratio and the total debt to total asset ratio have a significant association with the choice of a firm s income strategy this test provides strong evidence consistent with the positive theory of accounting standard setting choice we also present evidence that smaller firms and or firms in less concentrated industries do not appear to make accounting policy choice decisions that are consistent with this theory

an uncertainty analysis of subsidy for carbon capture and storage ccs retrofitting investment in china s coal power plants using a real options approach abstract carbon capture and storage ccs is an attractive option to help reduce china s carbon emission this paper analyzes the impacts of subsidy for electricity generation on ccs retrofitting investment and carbon abatement in china s coal power plants considering the coaction of carbon market and subsidy policy to this end this paper builds up a real option model considering carbon prices electricity prices and coal prices uncertainties for decision of ccs investment we consider two important aspects whether to invest and when to invest i e ccs investment s potential and timing some major findings include 1 the impacts of subsidy on ccs investment and carbon abatement are affected by carbon market conditions initial carbon price can determine the magnitude of subsidy s impacts while carbon prices uncertainty level can determine subsidy s marginal impacts 2 subsidy from 0 01 to 0 05 kwh can raise ccs investment potential by 9 66 39 18 shorten ccs investment period by 0 39 1 95 years and bring carbon abatement potential of 0 10 1 89 gtco 2 considering different carbon market conditions 3 with the benchmark carbon market and affordable subsidies triggered ccs investments in coal power plants have an economical efficient carbon abatement potential up to 20 of china s carbon emission in 2030

impact of political and economic barriers for concentrating solar power in sub saharan africa abstract sub saharan africa ssa needs additional affordable and reliable electricity to fuel its social and economic development ideally all of this new supply is carbon neutral the potentials for renewables in ssa suffice for any conceivable demand but the wind power and photovoltaic resources are intermittent and difficult to integrate in the weak electricity grids here we investigate the potential for supplying ssa demand centers with dispatchable electricity from concentrating solar power csp stations equipped with thermal storage we show that given anticipated cost reductions from technological improvements power from csp could be competitive with coal power in southern africa by 2025 but in most ssa countries power from csp may not be competitive we also show that variations in risk across countries influences the cost of power from csp more than variations in solar resources if policies to de risk csp investment to financing cost levels found in industrialized countries were successfully implemented power from csp could become cheaper than coal power by 2025 in all ssa countries policies to increase institutional capacity and cooperation among ssa countries could reduce costs further with dedicated policy measures therefore csp could become an economically attractive electricity option for all ssa countries

demise of the standard model for power sector reform and the emergence of hybrid power markets following earlier reforms in the power sectors of industrialized countries and emerging markets e g chile developing countries were encouraged to unbundle their electricity industries and to introduce competition and private sector participation this paper highlights the developments that led to how power sector reform came to be defined as a standard model and theoretical framework in its own right and how the model was used prescriptively in many developing countries however we also show that after more than 15 years of reform efforts this new industry model has not fully taken root in most developing countries finally we identify and characterize the emergence of new hybrid power markets which pose fresh performance and investment challenges

fixed costs sunk costs entry barriers and sustainability of monopoly this paper shows that i fixed costs of sufficient magnitude assure the existence of a vector of sustainable prices for the products of a natural monopolist prices making him invulnerable against entry ii nevertheless fixed costs do not constitute barriers to entry that is they need not have undesirable welfare consequences iii indeed in market forms that we call perfectly contestable large fixed costs are completely compatible with many desirable attributes of competitive equilibrium iv sunk costs do however constitute barriers to entry and v finally the profit and welfare consequences of entry barriers are described formally in this paper it is shown that i fixed costs of sufficient magnitude assure the existence of a vector of sustainable prices a set of product prices that make a natural monopolist invulnerable against successful entry ii nevertheless costs that are truly fixed do not constitute barriers to entry that is they do not have the welfare consequences normally attributed to barriers to entry iii indeed there are markets of a form which we call perfectly contestable markets and whose properties may be approximated in practice in which large fixed costs are completely compatible with many if not most of the desirable attributes of competitive equilibrium iv sunk costs do however constitute barriers to entry and v finally the resource allocation problems that stem from fixed costs are formally identical with those that accompany public goods both their sources and their character are the same thus the rationale for public supply of public goods may be no different from that pertaining to nationalization of natural monopolies

entry competition and regulation in uk telecommunications in a formerly monopolized industry now subject to competition there is likely to be considerable interaction between business strategy and regulation the paper illustrates the development of this process in uk telecommunications it sets out a framework in which competition between incumbent and entrants takes the form of a race on the part of the former to bridge the innovation gap and on the part of the latter to accumulate the necessary strategic assets including regulatory assets the strategies of major uk fixed link telecommunications firms are analyzed in this light and regulatory policy towards vertical separation in mobile telephony is also described the article draws attention to the crucial role which the regulator plays in assisting entrants to gain access to strategic assets including information copyright 1996 by oxford university press

the role of sunk costs in the decision to invest in r d we present a dynamic empirical model of a firm s r d decisions that is consistent with the existence of sunk r d costs taking into account that these costs may differ between small and large firms and among different technological regimes we estimate a multivariate dynamic discrete choice model using firm level data of spanish manufacturing for 1990 2000 conditional on firm heterogeneity and serially correlated unobservable factors we find that r d history matters this true state dependence allows inferring the existence of sunk r d costs associated with performing r d sunk r d costs are found to be higher for large high tech firms

dynamics of energy technologies and global change technological choices largely determine the long term characteristics of industrial society including impacts on the natural environment however the treatment of technology in existing models that are used to project economic and environmental futures remains highly stylized based on work over two decades at iiasa we present a useful typology for technology analysis and discuss methods that can be used to analyze the impact of technological changes on the global environment especially global warming our focus is energy technologies the main source of many atmospheric environmental problems we show that much improved treatment of technology is possible with a combination of historical analysis and new modeling techniques in the historical record we identify characteristic l such network e ects yield high barriers to entry even for superior competitors these simple observations allow three improvements to modeling of technological change and its consequences for global environmental change one is that the replacement of long lived infrastructures over time has also replaced the fuels that power the economy to yield progressively more energy per unit of carbon pollution from coal to oil to gas such replacement has d they also include endogenous generation of s we show that doing so can yield projections with lessened environmental impacts without necessarily incurring negative e ect on the economy arriving on that path by the year 2100 depends on intervening actions such as incentives to promote greater diversity in technology and lower barriers to entry for new infrastructures that could accelerate historical trends of decarbonization 1999 elsevier science ltd all rights reserved