public private partnerships for energy efficiency projects a win win model to choose the energy performance contracting structure abstract to stimulate private sector investments and promote energy efficiency in recent years through public private partnership arrangements the public sector uses private companies the energy service company esco to perform one or more activities related to the provision of energy services and the contractual arrangements defining the contracting parties obligations and rights are traditionally based on energy performance contracting epc although epc is a valuable model for delivering public energy efficiency projects the adoption is still far from its vast potential mainly because of two unresolved issues the dilemma of equally sharing the benefits between the public and private parties so as assuring a win win condition and the lack of adequate public procedures that support the selection of the most appropriate epc schema given certain circumstances and projects characteristics the existing literature have analyzed the advantages of epc mechanism for delivering energy efficiency projects and explored the critical success factors of epc however it does not provide any solution to address the issues that hamper the adoption of epcs in public sector to fill this gap this paper proposes a model for assessing and benchmarking the net benefits of the different epc structures so as choosing the epc schema that creates a win win solution for both the esco and the government by balancing the private sector s profitability needs and the public sector s economic interests the assessment of the benefits of the epc schema for contractual parties and the benchmark among the contracts are based on an economic approach which expresses the net benefit gained by each party through the three epc contracts in monetary terms and benchmarks the three epc schema through the net present value npv method the win win condition is ensured by the contract that minimizes the difference between the net profits npv gained by the contractual parties this will support the public authority in the decision making process about the epc structure to be adopted to develop an energy efficiency project as a ppp to demonstrate the applicability of the proposed model we apply it to an energy efficiency project launched by the municipality of noci southern italy

non cooperative bargaining of n 3 players abstract extensions to n 3 players of rubenstein s 1982 bargaining model with fixed common discount factor are considered if voting takes place simultaneously then any partition of the cake is a subgame perfect nash equilibrium outcome

the power to delay abstract this paper studies a bilateral bargaining game in which one party can suspend the game indefinitely if suspension is costless multiple equilibria arise if suspension is costly and subject to a budget constraint a unique equilibrium with immediate agreement is obtained

the power of the proposal maker in a model of endogenous agenda formation in a distributive setting this study examines a voting procedure for which agenda formation is endogenous it is found not surprisingly that agenda formation is another avenue for strategic manipulation of the voting process and provides the member to first take the floor an asymmetric advantage what is surprising is the degree of this advantage we find that the initial proposal maker earns a share of the fixed resource exceeding 1 for an majority rule and this is regardless of the number of members the voting rule is found to be an effective instrument in at least partially offsetting the power of the proposal maker while maintaining the stability of the voting process

a bargaining model of collective choice we present a general model of legislative bargaining in which the status quo is an arbitrary point in a multidimensional policy space in contrast to other bargaining models the status quo is not assumed to be bad and delay may be pareto efficient we prove existence of stationary equilibria the possibility of equilibrium delay depends on four factors risk aversion of the legislators the dimensionality of the policy space the voting rule and the possibility of transfers across districts if legislators are risk averse if there is more than one policy dimension and if voting is by majority rule for example then delay will almost never occur in one dimension delay is possible if and only if the status quo lies in the core of the voting rule and then it is the only possible outcome this core selection result yields a game theoretic foundation for the well known median voter theorem our comparative statics analysis yield two noteworthy insights i if the status quo is close to the core t hen equilibrium policy outcomes will also be close to the core a moderate status quo produces moderate policy outcomes and ii if legislators are patient then equilibrium proposals will be close to the core legislative patience leads to policy moderation

a note on three player noncooperative bargaining with restricted pairwise meetings abstract a three player bargaining game where only the central player can negotiate with two different partners has a unique perfect equilibrium outcome we discuss when the a priori favored position of the central player is really advantageous in terms of equilibrium payoffs

new energy strategies in the swedish pulp and paper industry the role of national and eu climate and energy policies the swedish pulp and paper industry has gone through a strategic change in its approach to electricity production and consumption over the past decade this paper documents this reorientation which includes increased on site electricity production investments and investment plans for wind power and new partnerships concerning investments in electricity production assets we also assess the extent to which these changes can be attributed to key energy and climate policies our analysis shows that this strategic reorientation has been driven by changes in the underlying economic conditions for the pulp and paper industry in particular increases in the price of electricity following the swedish energy market reform in 1996 and the introduction of the eu ets the scheme for tradable renewable electricity certificates on the other hand has provided a new source of income while these market based signals and responses are the most dominant drivers of strategic change cognitive changes in the pulp and paper industry have also played a role in the strategic reorientation the cognitive changes concerning the functioning of the electricity market i e the pricing of electricity and influence of the eu ets have been particularly important in this regard

price discrimination in oligopoly evidence from regional newspapers recent theoretical work has shown that the incentive to target rival firms customers with low prices can increase price discrimination and that the strength of the incentive depends on a firm s market position using data on swedish newspaper subscriptions we find strong support for these predictions newspapers with a local competitor sell a larger part of their circulation at a discount than monopoly newspapers moreover in competitive markets the use of discounts is inversely related to the newspaper s market share we find no evidence that price discrimination based on observable and exogenous characteristics is influenced by the market structure

commitment and conflict in bilateral bargaining building on crawford 1982 we study a model of bilateral bargaining in which negotiators can make binding commitments at a low positive cost c our primary solution concept is iterated strict dominance if commitment attempts never fail there are three solutions in two solutions all the surplus goes to one player in the third solution there is a high probility of con ict if commitment attempts succeed with probability q 1 the unique solution entails con ict with probability q 2 when c 0 analogous results hold if the requirement of iterated strict dominance is replaced by iterated weak dominance

use of multicriteria decision analysis methods for energy planning problems most decision making requires the consideration of several conflicting objectives the term multiple criteria decision analysis mcda describes various methods developed for aiding decision makers in reaching better decisions energy planning problems are complex problems with multiple decision makers and multiple criteria therefore these problems are quite suited to the use of mcda a multitude of mcda methods exists these methods can be divided in three main groups value measurement models goal aspiration and reference level models and outranking models methods from all of these groups have been applied to energy planning problems particularly in the evaluation of alternative electricity supply strategies each of the methods has its advantages and drawbacks however we cannot conclude that one method generally is better suited than the others for energy planning problems a good alternative might be to apply more than one method either in combination to make use of the strengths of both methods or in parallel to get a broader decision basis for the decision maker until now studies of mcda in energy planning have most often considered energy networks with only one energy carrier more advanced energy systems with multiple energy carriers have been neglected even though this field ought to be suitable for use of mcda due to its high complexity many decision makers and many conflicting criteria

assessing long term energy security the case of electricity in the united kingdom there is a growing body of research into the potential security risks and trade offs which may emerge over the long term development of energy systems as part of this body of research this paper aims to develop and demonstrate a set of indicators for assessing the security of long term national electricity scenarios this paper extends the empirical work of existing frameworks by including reliability and cost parameters alongside a range of other important aspects of energy security such as diversity trade and acceptability and by using both qualitative and quantitative indicators without aggregation in order to identify trade offs this paper uses the indicators to assess the energy security implications of three plausible long term scenarios for the uk electricity system the results indicate that a major risk may be experienced by a lack of flexible responsive supply capacity in low carbon electricity pathways reducing overall energy demand is found to be the most beneficial policy for improving energy security in terms of generating benefits in multiple dimensions the paper finds that energy security is often conceptualised as the avoidance of causes of insecurity such as insecure fuel imports but that an equally important aspect of security lies in maximising responses to insecurity for example by increasing the flexibility and responsiveness of both supply and demand

external costs of energy do the answers match the questions looking back at 10 years of externe abstract while the claim for getting prices right is quite popular in conceptual policy papers the implementation of appropriate internalisation strategies is still hampered by a lack of reliable external cost data great expectations were set into the externe project a major research programme launched by the european commission at the beginning of the 1990s to provide a scientific basis for the quantification of energy related externalities and to give guidance supporting the design of internalisation measures after more than a decade of research the externe label became a well recognised standard source for external cost data looking back into the externe history the paper pursues how emerging new scientific insights and changing background assumptions affected external cost estimates and related recommendations to policy over time based on externe results the usefulness and inherent limitations of external cost estimates for impact categories like climate change or nuclear waste disposal is discussed the paper also gives examples on how external costs in spite of remaining uncertainties are successfully used to support environmental policy

introduction to the special issue on advances in life cycle approachesto business and resource management in the asia pacific region abstract this special issue of the journal of cleaner production was initiated as a result of the 5th and 6th meetings of the asia pacific roundtable for sustainable consumption and production aprscp which were held in melbourne australia and hanoi vietnam respectively a need identified at those meetings was to create another means of communicating the best ideas and papers being presented to a wider audience the asia pacific region has special development needs given its rapid emergence as a global production hub but coupled to that are also the rapid social adjustments and shifts in patterns of consumption and production which aren t positive for the environment this special issue contains eight papers covering the implementation of cleaner production and life cycle principles at the systems and regional planning level these articles cover urban development corporate cp programs supply chain management eco industrial networks and industrial parks recycling and understanding the role of human factors in bringing about environmental change

striking for a bargain between two completely informed agents this paper models the wage contract negotiation procedure between a union and a firm as a sequential bargaining process in which the union must decide in each period whether or not to strike for the duration of that period we show that there exist subgame perfect equilibria in which the union engages in several periods of strikes prior to reaching a final agreement although both parties are completely rational and fully informed this has implications for other inefficient phenomena such as tariff wars debt negotiations and wars in general we characterize the set of equilibria show that strikes can occur in real time and discuss extensions of the model such as lockouts and the possibility of multiple recontracting opportunities copyright 1991 by american economic association

proposal power and majority rule in multilateral bargaining with costly recognition this paper studies a sequential bargaining model in which agents expend efforts to be the proposer in equilibrium agents effort choices are influenced by the prize and cost effects the endogenous prize is 9

an empirical investigation of the welfare effects of banning wholesale price discrimination rand 054 rand2007 cls 1994 07 13 v1 2u standard latex document class rand rand 054 dispatch 12 7 2008 ce n a journal msp no no of pages 26 pe sharon rand journal of economics vol 40 no 1 spring 2009 pp 20 45 an empirical investigation of the welfare effects of banning wholesale price discrimination sofia berto villas boas economic theory does not provide sharp predictions on the welfare effects of banning wholesale price discrimination if downstream cost differences exist then discrimination shifts production inefficiently toward high cost retailers so a ban increases welfare if differences in price elasticity of demand across retailers exist discrimination may increase welfare if quantity sold increases so a ban reduces welfare using retail prices and quantities of coffee brands sold by german retailers i estimate a model of demand and supply and separate cost and demand differences simulating a ban on wholesale price discrimination has positive welfare effects in this market and less if downstream cost differences shrink or with less competition introduction wholesale price discrimination means that an upstream firm sets different prices for the same product for various downstream retailers wholesale price discrimination is commonly practiced in many markets examples include markets such as petroleum distribution steel heavy trucking tobacco and pharmaceuticals in several countries milk and other dairy products are sold using government administered or sanctioned discriminatory pricing schemes wholesale price discrimination practices are also used for services such as loans insurance and advertising 1 competition authorities have been concerned with wholesale price discrimination the european union treaty s article 82 c prohibits practices where a dominant firm would place trading partners at a competitive disadvantage the u s robinson patman act forbids discriminat ing in price between different purchasers where the effect may be to lessen competition unless the university of california berkeley sberto are berkeley edu i thank the editor igal hendel and two anonymous referees for many helpful comments and max auffhammer cyndi berck peter berck gal hochman silke januszewski forbes george judge kai uwe k uhn diana lazo mark muendler aviv nevo ariel pakes jeff perloff andrew sweeting miguel villas boas and participants at uc san diego university of michigan the inra idei conference in toulouse and the university of british columbia summer conference in industrial organization for their suggestions i thank daniel klapper for letting me have access to the data support from the giannini foundation and from an aes grant are gratefully appreciated see for gasoline markets texaco v hasbrouck 496 us 543 no 87 2048 1990 and the new york state motor fuel marketing practices act for steel chan hall and rust 2003 for heavy trucking volvo trucks north america inc v reeder simco gmc inc docket no 04 905 for tobacco brooke group ltd v brown and williamson tobacco corp 509 us 209 no 92 466 1993 for wholesale pharmaceuticals see http www datcp state wi us trade business unfair comp drug price jsp for dairy markets see for example gardner 1984 and for services see givens 1983 c 2009 rand copyright

energy management practices in swedish energy intensive industries previous studies point out a large untapped potential for energy efficiency in industry through the adoption of energy management practices the aim of this paper is to describe and analyze energ

review of policies and measures for energy efficiency in industry sector abstract energy efficiency in industry plays key roles in improving energy security environmental sustainability and economic performance it is particularly important in strategies to mitigate climate change the evidence of great potential for cost effective efficiency derived reductions in industrial energy use and greenhouse gas ghg emissions have prompted governments to implement numerous policies and measures aimed at improving their manufacturing industries energy efficiency what can be learned from these many and varied initiatives this paper provides foundation for policy analysis for enhancing energy efficiency and conservation in industry by surveying more than 300 policies encompassing about 570 measures implemented by governments in iea countries brazil china india mexico russia and south africa it outlines the measures main features their incidence of use and their connections with specific technical actions and key stakeholders i e how and where measures affect the energy efficiency of industry it also examines the key features underlying the measures success 1 potential to reduce energy use and co2 emissions cost efficiently 2 ease of policy development execution and assessment and 3 ancillary societal effects

the inclusion of spinning reserves in investmetn and simulation models for electricity generation abstract the demand for electricity varies substantially from hour to hour from day to day and from season to season because electricity is a highly perishable commodity which can be stored only at great expense and because the penalty for failing to meet demand is severe the fluctuations of demand over time are crucial in determining an optimal investment strategy for generating equipment traditionally demand is represented by a load duration curve which neglects the time of day when peaks and troughs occur by incorporating a load distribution curve into the model in a computationally tractable manner this paper demonstrates that the results of the traditional models may be sensitive to changes in the assumptions implied by the load duration curve

sequential formation of coalitions in games with externalities and fixed payoff division this paper analyzes a sequential game of coalition formation when the division of the coalitional surplus is fixed and the payoffs are defined relative to the whole coalition structure gains from cooperation are represented by a valuation which maps coalition structures into payoff vectors i show that any core stable coalition structure can be attained as a stationary perfect equilibrium of the game if stationary perfect equilibria may fail to exist in general games a simple condition is provided under which they exist in symmetric games furthermore symmetric stationary perfect equilibria of symmetric games generate a coalition structure which is generically unique up to a permutation of the players a general method for the characterization of equilibria in symmetric games is proposed and applied to the formation of cartels in oligopolies and coalitions in symmetric majority games journal of economic literatureclassification numbers c78 c71 1996 academic press inc

risk aversion exchange rate uncertainty and the law of one price insights from the market for online air travel tickets we argue that risk aversion driven by exchange rate uncertainty causes a wedge between the domestic and foreign prices of a homogeneous good we test our hypothesis using a unique micro data set from a market with minimum imperfections the empirical findings validate our hypothesis as accounting for exchange rate uncertainty we are able to explain a significant proportion of deviations from the law of one price overall our analysis suggests the possibility of a new solution to the purchasing power parity puzzles

does competition reduce price dispersion new evidence from the airline industry we analyze the effects of competition on price dispersion in the airline industry using panel data from 1993 q1 through 2006 q3 competition has a negative effect on price dispersion in line with the textbook treatment of price discrimination this effect is pronounced for routes with consumers characterized by relatively heterogeneous elasticities of demand on routes with a homogeneous customer base the effects of competition on price dispersion are smaller our results contrast with those of borenstein and rose who found that price dispersion increases with competition we reconcile the different results by showing that the cross sectional estimator suffers from omitted variable bias

price discrimination in the airline market the effect of market concentration we test the hypothesis that price discrimination increases with competition in the airline market using a large cross section of tickets offered by several carriers on various routes we approximate price discrimination with marginal implicit prices of ticket restrictions that carriers typically use to price discriminate saturday night stayover re quirements and advanced purchase discounts we find that the restrictions are associated with lower airfares but that the discounts are smaller on routes with higher market concentration the results suggest that price dispersion attributed to ticket restrictions increases as markets becomemore competitive

price discrimination in free entry markets using a spatial model of monopolistic competition we investigate price discrimination in free entry zero profit markets we show that when brands are heterogeneous competition does not prevent discrimination the power to earn economic profits is not necessary for a firm to maintain discriminatory prices our model treats formally the fact that consumers difer not only in the utility they derive from a good but also in how strongly they prefer one brand over all others in markets where firms are very competitive sorting consumers on the strength on brand preference produces larger price differentials between groups than sorting on the basis of consumers reservation prices for the good when firms sort customers on the basis of strength of brand preference however we find that the output and welfare effects are generally less favorable than when sorting is more closely related to consumers reservation prices

integrating demand side options in electric utility planning a multiobjective approach this paper proposes simultaneous integration of dsm options in a multiobjective framework using a compromise programming technique for electric utility planning the two distinct advantages of this method are i explicit consideration of all associated benefits of dsm options viz cost reduction emissions reduction and improvement of supply system reliability and ii consideration of the integration method s specific characteristics of various types of dsm options depending upon the control of the utility on their application the methodology is applied to an indian electric utility maharashtra state electricity system mses for its integrated resource planning for the period 1990 2000 to illustrate the methodological issues various methodological issues related to the specific nature of dsm options and multiobjective framework are also discussed in the context of mses

money burning and multiple equilibria in bargaining abstract this paper synthesizes recent work on delay and multiple equilibria in complete information rubinstein bargaining we identify a general principle money burning underlying prior results and develop a general model of the phenomena money burning is a threat by one player to destroy surplus which can serve to enhance that player s bargaining power if it is credible our results show that the uniqueness and efficiency properties of the subgame perfect equilibrium of rubinstein bargaining are vulnerable to players ability to burn money journal of economic literature classification number 026

the economics of energy service contracts energy service contracting can provide a cost effective route to overcoming barriers to energy efficiency energy service contracts allow the client to reduce operating costs transfer risk and concentrate attention on core activities however the energy services model may only be appropriate for a subset of energy services and energy using organisations a challenge for both business strategy and public policy is to identify those situations in which energy service contracting is most likely to be appropriate and the conditions under which it is most likely to succeed energy service contracting is a form of outsourcing it will only be chosen where the expected reduction in the production cost of supplying energy services can more than offset the transaction cost of negotiating and managing the relationship with the energy service provider production costs will be determined by a combination of the physical characteristics of the energy system and the technical efficiency of the relevant organisational arrangements including economies of scale and specialisation transaction costs in turn will be determined by the complexity of the energy service the specificity of the investments made by the contractor the competitiveness of the energy services market and the relevant legal financial and regulatory rules this paper develops these ideas into a general framework that may be used to assess the feasibility of energy service contracting in different circumstances the framework leads to a number of hypotheses that are suitable for empirical test

investment planning for hydro thermal power system expansion stochastic programming employing the dantzig wolfe decomposition principle this paper presents an application of the dantzig wolfe decomposition principle to the problem of investment planning in the electric power sector the formulation of the capacity planning problem incorporates uncertainties in long term load growth and in fuel supply availability in addition the formulation permits the inclusion of such demand side investment decisions as conservation as well as conventional and renewable supply investments and it allows flexibility in modeling system reliability reliability targets can be incorporated as constraints or reliability can be optimized by minimizing customer outage costs in addition to investment costs and operating costs results of an application to the pacific northwest involving problem sizes up to 30 000 rows and 54 000 columns are reported

policies for eliminating low efficiency production capacities and improving energy efficiency of energy intensive industries in china abstract china faced the greatest challenge in balancing its economic growth energy and resource security as well as environmental pollution the energy intensive industries which used to be the major force driving china s economic growth had seriously exhausted the countries natural resources and energy and at the same time polluted the environment because of the severe surplus of low efficiency production capacities as a result the chinese government had initiated multiple economic and administrative policies to eliminate these low efficiency production capacities intended to improve the energy efficiency of energy intensive industries these policies are summarized in this paper along with export tax rebating rate resource tax administrative audit and approvals differential electric power pricing and shutting down the low efficiency production capacities the paper also evaluates the effects of these policies by analyzing several key indicators about the energy intensive industries including fixed asset investment growth rate energy intensity of industrial added value waste gas emission intensity of industrial added value the valdex methodology is selected to examine the improving trends of energy efficiency for energy intensive industries the analyzing results show that firstly the development of low efficiency capacities tends to be more sensitive to the policies so the policies that china had enacted really exert very important effects on improving the energy efficiency of energy intensive industries however the effects of economic policies seem more faster and obvious than the fiscal policies besides the results also show that polices which are designed to reserve energy may not necessarily exert the same effects on reducing emissions there is still large room for improving the energy efficiency of energy intensive industries substantial improvement still needs to be done for current policies system some suggestions for future work are provided

the development of policy instruments in supporting low carbon governance in china abstract this paper examines the development of policy instruments that support the low carbon governance in china the instruments are analysed in five aspects in relation to the key policies in low carbon governance in china including energy conservation developing new energy reforestry developing circular economy and industry restructuring each aspect is discussed in three instrument groups which are 1 law and regulations 2 industry standard and 3 finance and taxation this research suggests that law enforcement for the new established laws should be further strengthened and stricter supervision systems should be in place to safeguard effective implementation of low carbon policies measures and standards especially for those energy condensed sectors more rigorous industry standards regarding energy efficiency should be considered to help eliminate outdated equipments in industries and promote the introduction of more climate friendly technologies the industrial standards should be given strong legal support in accountability in order to enforce their complete application once in operation new policies and instruments need to be introduced in order to reduce carbon print by landfill the backward law and industrial standards in china should be upgraded more regularly therefore to support the low carbon development strategy

coalitional bargaining with competition to make offers abstract the paper analyzes a simple discrete time noncooperative coalitional bargaining game in which at each stage there is a contest for the right to make a proposal the pure stationary subgame perfect equilibrium payoff set is equal to the core journal of economic literature classification numbers 026

clean and secure power supply a system dynamics based appraisal abstract across the world the electricity industry is changing with the advent of renewable energy sources such as solar and wind power as these are exposed to intermittency seasonality and global climate variation policy makers concerns are now shifting towards security of supply in fact the industry confronts three conflicting goals security of supply competitive prices to customers and environmental protection in this context and given the multiple uncertainties of technology transformation this paper uses modelling based scenario analysis to investigate different extreme and plausible futures simulation is used to analyse policies aimed at increasing the penetration of renewables and to explore how these energy sources may affect system reliability this paper explores the effect of incorporating renewables in colombia where a large hydroelectric component has led to insufficient electricity being available during droughts and to high electricity price volatility though not intuitive at first glance this paper shows that renewables may contribute to i increased security of supply through complementarity e g it does not rain when the sun shines ii reduced price volatility in the medium term and iii increased industry sustainability

analysis on energy intensive industries under taiwan s climate change policy abstract this study addresses the planning and implementation of energy industry and carbon economy policies concerning the development of the taiwan s energy intensive industries from perspective of climate change as a newly industrialized country taiwan attaches greater importance to the development of green energy and low carbon industries in cooperation with global pressure for carbon reduction due to climate changes through energy and industrial conferences thus in the past year the taiwanese government constructed four laws concerning energy and carbon reduction in order to drive the green energy industry furthermore it plans to reduce current carbon emission benchmarks nevertheless statistical analysis found that in the last decade energy intensive industries have presented structural unbalance regarding energy consumption co 2 emissions energy intensity contributions to the gdp and product value industries in the industrial sector have high energy consumption high carbon emissions and increase total domestic consumption and carbon emissions which have disproportionate contributions to industrial added value nevertheless the government continues to approve investments for such energy intensive industries and results in continuous increases in energy consumption and carbon emissions this contradictory phenomenon indicates that newly industrialized countries rely on a manufacturing economic structure which is difficult to adjust and violates the trends of a global low carbon economy hence the government must examine and adjust such unbalanced industrial structures where such adjustments are executed in a fair and just manner and encourage the development of high value added measures for low carbon manufacturing and service sectors to become equal with competitors in a global economy

rent seeking and surplus destruction in unanimity bargaining abstract in non cooperative bargaining games in the tradition of rubinstein the proposer s bargaining power stems from the prospect of a delay in case of disagreement since players are impatient this delay is costly for everyone we consider a unanimity bargaining game in which the proposer can strategically choose the length of this delay we assume that the size of the surplus depends endogenously on the chosen length of the prospective delay intuitively the proposer faces the following trade off the more he exploits his proposer power the smaller is the surplus that can be divided one interpretation is that aggressive bargaining tactics hurt the fruitful cooperation among players and thus the surplus we characterize stationary equilibrium strategies and payoffs and obtain sharp predictions on the extent of surplus destruction the size of the social loss and the surplus allocation

reflex an adapted production simulation methodology for flexible capacity planning as intermittent energy resources become more significant in power production traditional capacity planning may be insufficient to ensure reliable system operation a system planner must ensure that flexibility solutions are available to respond to large and uncertain ramping events these solutions may be operational such as improved unit commitment and dispatch curtailment of renewables or demand response procurement based such as new fast ramping resources or batteries or involve market reform this paper outlines a new methodology for modeling the economic tradeoffs in implementing flexibility solutions for integrating renewables the proposed model includes both a stochastic treatment of system states to account for a wide range of operating conditions and an adapted production simulation methodology that weighs the cost of reliability and subhourly flexibility violations against the cost of the operational flexibility solutions available to mitigate them the model s functionality is demonstrated with a case study of california at a 50 rps in 2030 the model tests the value of 1088 mw of generic flexible units relative to the same capacity of must run resources finding an expected annual value of 347 pm 42 million yr potential applications of the model for resource planning and procurement are also discussed

a unique solution to n person sequential bargaining abstract rubinstein s two person sequential bargaining model yields a unique subgame perfect equilibrium this uniqueness result does not hold with three or more persons based on greenberg s theory of social situations uniqueness is here offered as follows assume a player can profitably reject a suggested path at one of his decision nodes by suggesting a new one to later players if by doing so he gains more than e a path is acceptable of and only if no player can profitably reject it by suggesting another acceptable path it is shown that only the stationary division is acceptable for any e 0

generation expansion planning optimisation with renewable energy integration a review generation expansion planning consists of finding the optimal long term plan for the construction of new generation capacity subject to various economic and technical constraints it usually involves solving a large scale non linear discrete and dynamic optimisation problem in a highly constrained and uncertain environment traditional approaches to capacity planning have focused on achieving a least cost plan during the last two decades however new paradigms for expansion planning have emerged that are driven by environmental and political factors this has resulted in the formulation of multi criteria approaches that enable power system planners to simultaneously consider multiple and conflicting objectives in the decision making process more recently the increasing integration of intermittent renewable energy sources in the grid to sustain power system decarbonisation and energy security has introduced new challenges such a transition spawns new dynamics pertaining to the variability and uncertainty of these generation resources in determining the best mix in addition to ensuring adequacy of generation capacity it is essential to consider the operational characteristics of the generation sources in the planning process in this paper we first review the evolution of generation expansion planning techniques in the face of more stringent environmental policies and growing uncertainty more importantly we highlight the emerging challenges presented by the intermittent nature of some renewable energy sources in particular we discuss the power supply adequacy and operational flexibility issues introduced by variable renewable sources as well as the attempts made to address them finally we identify important future research directions

a review of industrial energy and climate policies in japan and sweden with emphasis towards smes abstract the threat of increased global warming resulting from the use of fossil fuels stresses decision makers to formulate and adopt policies towards different sectors of the economy in light of the great earthquake in japan 2011 energy efficiency also plays an important role in meeting the challenge of power supply shortage energy policies towards industry are of particular importance as a major part of the energy in the economy is used in industrial production the number of papers investigating and presenting experience from energy end use policies are scarce furthermore for those present they often only include a very brief analysis from a public point of view evaluations of energy programs are of major importance to measure the performance of the programs from an energy policy designer point of view it is of major importance to not only see the cost effectiveness of the policy but also to understand the fundamental mechanisms for the success or failure of an industrial energy program in order to learn how to improve future programs the aim of this paper is to present a review of energy end use policy instrument in japan and sweden towards the industrial sector from 1990 to 2014 with special emphasis on industrial smes from the results presented some general conclusions can be made 1 results show that the cost effectiveness differs substantially between the evaluated programs and 2 that from a governmental point of view subsidies towards energy audit programs seem like the most cost effective policy in addition to this 3 the results from the review also stress the importance of a clear strategy for every energy program on how the program is going to be evaluated ex ante or ex post and how the performance of the program is to be measured this structure should be included from the start of the program

competitive coupon targeting with the advent of panel data on household purchase behavior and the development of statistical procedures to utilize this data firms can now target coupons to selected households with considerable accuracy and cost effectiveness in this article we develop an analytical framework to examine the effect of such targeting on firm profits prices and coupon face values we also derive comparative statics on firms optimal mix of offensive and defensive couponing the number of coupons distributed redemption rates face values and incremental sales per redemption among our findings when rival firms can target their coupon promotions at brand switchers the outcome will be a prisoner s dilemma in which the net effect of targeting is simply the cost of distribution plus the discount given to redeemers

selection of energy performance contracting business models a behavioral decision making approach abstract as a market based mechanism which can actively promote energy efficiency energy performance contracting epc is now universally accepted throughout china and has been incorporated into various business models four of these business models are frequently adopted in china the share savings model the guaranteed savings model the energy cost trust model and the finance lease model the choice of a suitable business model has been recognized as one of the most important factors in the effective implementation of epc projects in this paper the selection of epc business models is formulated as a multi criteria decision making mcdm problem when selecting an epc business model it is natural for decision makers dms to express their preferences opinions in linguistic terms given the characteristics of epc projects taking dms psychological behavior into account is of considerable and realistic significance todim an acronym in portuguese of interactive and multicriteria decision making has been verified as an effective behavioral decision making method to address the problem of epc business model selection an extended todim method based on multi granularity linguistic terms and entropy measure is proposed the sensitivity and comparison analyses show that dms psychological behavior can affect the selection order with respect to the given epc business models one case of a real life campus epc project demonstrates that the validity and applicability of the proposed extended todim method for solving the epc business model selection problem

a theory of endogenous coalition structures consider an environment with widespread externalities and suppose that bind ing agreements can be written we study coalition formation in such a setting our analysis proceeds by defining on a partition function an extensive form bargaining game we establish the existence of a stationary subgame perfect equilibrium for such a game our main results are concerned with the characterization of equilib rium coalition structures we develop an algorithm that generates under certain conditions an equilibrium coalition structure our characterization results are especially sharp for symmetric partition functions in particular we provide a uniqueness theorem and apply our results to a cournot oligopoly journal of economic literature classification numbers c71 c72 c78 d62 q 1999 academic press

predictability and power in legislative bargaining the rules and procedures of legislatures often provide legislators with information bearing on the identities of upcoming proposers for a broad class of legislative bargaining games we establish that markovian equilibria necessarily deliver all economic surplus to the first proposer whenever the information structure permits the legislators to rule out some minimum number of proposers one round in advance this result holds regardless of the recognition process and even if players vary in patience and risk aversion it raises the possibility that procedures adopted in the interest of transparency may contribute to the imbalance of political power

transaction costs of tradable white certificate schemes the energy efficiency commitment as case study this paper analyses the nature and scale of transaction costs tcs borne by obliged parties under a tradable white certificate twc scheme taking the first phase of the energy efficiency commitment eecl in great britain as a case study several sources of tcs were considered such as search for information persuasion of customers negotiation with business partners and measurement and verification activities information was obtained through interviews and a questionnaire distributed to obliged parties results show that the most significant sources of tcs were related to search for information persuading customers and negotiating with managing agents contractors to implement energy efficiency measures perceived high tcs related to contract negotiation and liability risks slightly reduced the low trading level the scale of tcs was estimated to be around 10 and 30 of total investments costs for the lighting and insulation segments respectively the results indicate that despite the presence and scale of tcs the eecl scheme generated energy savings that yielded net societal benefits estimated financial benefits range from 0 6 to 6 p kwh for insulation and lighting savings respectively when avoided external costs due to electricity savings are included estimated economic benefits range from 3 to 8 p kwh several lessons from the eecl can be drawn for twc schemes among others it is found that informative policy instruments to raise awareness among end users are critical if a twc scheme is to deliver cost effective energy savings in all the nature and scale of tcs under twc schemes will differ because of a number of endogenous and exogenous determinants c 2007 elsevier ltd all rights reserved less

voluntary agreements in the field of energy efficiency and emission reduction review and analysis of experiences in the european union abstract a number of member states of the eu have introduced voluntary agreements vas that aim to deliver energy savings and emission reductions via increased energy efficiency in different end use sectors mainly targeting industry where there is a successful track record of cooperation between public authorities and the private sector vas can offer advantages to public authorities in comparison to legislation most importantly better flexibility when introduced or updated greater acceptance by industry possibility for tailor made solutions e g at the level of industrial sectors and opportunity to overcome the information asymmetry between public authorities and private actors nevertheless vas have been criticized for lack of specific obligations and lenient targets as well as for deficiencies in compliance monitoring and self reporting and difficulty in establishing the policy additionality of va activity this paper analyses the design of existing vas in terms of general framework targets and sectors obligations and commitments motivation to join reporting and monitoring provisions and results of existing vas as reported by national authorities the paper summarizes the key characteristics of voluntary agreements and gives recommendations for the successful application of this policy tool

price discrimination and bargaining empirical evidence from medical devices many important issues in business to business markets involve price discrimination and negotiated prices situations where theoretical predictions are ambiguous this paper uses new panel data on buyer supplier transfers and a structural model to empirically analyze bargaining and price discrimination in a medical device market while many phenomena that restrict price discrimination are suggested as ways to decrease hospital costs e g mergers group purchasing organizations and transparency i find that 1 non discriminatory pricing actually works against hospitals because competition is more intense under price discrimination and 2 results depend ultimately on a previously unexplored bargaining effect

multiperson bargaining over two alternatives abstract we present a continuous time model of multiperson bargaining with incomplete information where only two agreements are possible we show that under mild informational assumptions players behave as if they were representing the other players who prefer the same alternative individually playing a war of attrition against a conglomerate player of the opposite side we also provide a characterization of the perfect bayesian equilibria in undominated strategies of the game which yields a unique outcome in most cases journal of economic literatureclassification numbers c72 c78 d72 d74

scaling up the energy service company business market status and company feedback in the russian federation abstract many energy efficiency professionals have proposed using energy performance contracts epcs as a mechanism to improve public sector energy efficiency in countries with restrictive government budgets however in practice most middle income countries have used this mechanism only in a limited way russia offers an interesting case study because of its huge energy savings opportunities increasing energy prices robust political backing for public sector energy efficiency and evolving legislation that supports epcs in 2009 the russian federation initiated reductions in the country s energy intensity including of the large public sector which accounts for 9 percent of russia s total energy consumption to achieve energy efficiency goals in the public sector russia experimented with its public procurement rules adjusting them to encourage epcs we reviewed the russian government s official public database conducted structured interviews with energy service companies escos in russia and supplemented them with online research even though this process might not have captured all of the epcs signed in russia as of mid 2013 we estimate that nearly 50 escos signed about 150 contracts in public facilities most esco contracts in russia are for 5 years and they generally are small under 100 000 escos in russia face a challenging environment which leads to smaller projects escos also are concerned about costly and risky tender procedures uncertainty regarding repayment from public facilities the inability to expand projects and financing we discuss these challenges and propose potential solutions at policy and company levels the escos feedback regarding russia s experimental model can inform the country s program for public sector energy efficiency and offer lessons for other countries attempting to develop the epc mechanism

a letter to the editor on wage bargaining abstract the rubinstein perfect information alternating offers bargaining model is problematic when applied to wage negotiations a strike or any other industrial action is not an automatic consequence of a delay in reaching an agreement because production can continue normally also when negotiations take place this paper extends the rubinstein model to incorporate the choice of calling a strike and it is shown that in this model there is no longer a unique subgame perfect equilibrium and that strikes with a length in real time can occur in equilibrium

non cooperative bargaining theory an introduction the paper provides an informal introduction to some of the main themes of the recent literature on non cooperative or sequential bargaining models it focuses in particular on the relationship between the new approach and the traditional axiomatic approach exemplified by nash bargaining theory it illustrates the new insights offered by the non cooperative approach by reference to a detailed analysis of the manner in which the presence of an outside option available to one of the parties will affect the negotiated outcome finally the difficulties which arise in extending this analysis to two person bargaining with incomplete information and to n person bargaining are discussed this is a revised version of the fourth review of economic studies lecture presented in april 1985 at the joint meeting of the association of university teachers of economics and the royal economic society held in oxford the choice of lecturer is made by a panel whose members are currently professors hahn mirrlees and nobay and the paper is refereed in the usual way this paper aims to provide an informal and elementary introduction to an approach to bargaining which has received a great deal of attention over the past few years the approach involves writing down some particular sequence of moves offers and replies to be made over time in the course of negotiations and then looking for a non cooperative equilibrium in the game thus specified in practice a perfect equilibrium or in games of incomplete information a sequential equilibrium while the approach appears at first sight to be very different in spirit from the traditional axiomatic approach in which a bargaining solution is specified by appealing to a number of general requirements which are deemed appropriate on the basis of some a priori considerations the two approaches are in fact complementary while the

third degree price discrimination in oligopoly all out competition and strategic commitment price discrimination by imperfectly competitive firms may intensify competition leading to lower prices for all consumers the tradeoff of consumer groups welfare that is characteristic of monopolistic discrimination need not arise this escalation of competition may make firms worse off and as a result firms may wish to avoid the discriminatory outcome under conditions similar to those in which unambiguous price and welfare effects may arise unilateral commitments not to price discriminate including the adoption of everyday low pricing or no haggle policies may raise firm profits by softening price competition

energy conservation and co2 emission reduction in china s 11th five year plan a performance evaluation in the 11th five year plan fyp 2005 2010 the chinese government initiated a series of energy saving and emission reduction policies in many key fields in response to environmental pollution and climate change this paper quantitatively evaluates the performance of energy conservation and co2 emission reduction in this period the impact of these policies and potentials by integrating the contributions of energy conversion efficiency and energy utilization efficiency improvement industrial restructuring fuel mix shift and renewable energy development in a unified framework as a first attempt to introduce energy conversion efficiency improvement into a decomposition approach comprehensive and specific policies are summarized as a policy list to be investigated the results show that energy intensity and conversion efficiency effects were mainly responsible for driving down energy consumption by 637 4 mtce and 85 4 mtce respectively and they reduced co2 emissions by 1345 3 mt and 243 8 mt respectively due to a significant improvement in the 11th fyp period most of the contributions made by the conversion efficiency effect 94 come from thermal power generation and the emission coefficient effect reduced co2 emissions by 17 4 mt through developing renewable energy economic growth is still the biggest driver of energy consumption and increasing emissions while industrial restructuring and fuel mix shift effects contributed relatively little developing renewable energy and promoting economic restructuring to limit the increase of energy intensive sectors are still the main challenges and the next policy focus to achieve the targets for energy saving and carbon emission reduction in the 12th five year plan

multilateral bargaining with concession costs this paper presents a new non cooperative approach to multilateral bargaining we consider a demand game with the following additional ingredients i there is an exogenous deadline by which bargaining has to end ii prior to the deadline players may sequentially change their demands as often as they like iii changing one s demand is costly and this cost increases as the deadline gets closer the game has a unique subgame perfect equilibrium prediction in which agreement is reached immediately and switching costs are avoided moreover this equilibrium is invariant to the particular order and timing in which players make demands this is important as multilateral bargaining models are sometimes too sensitive to these particular details in our context players with higher concession costs obtain higher shares of the pie their increased bargaining power stems from their ability to credibly commit to a demand earlier we discuss how the setup and assumptions are a reasonable description for certain real bargaining situations

bargaining with surplus destruction in a two player alternating offer bargaining model if one player can destroy the surplus to be allocated then the value to bargain for is endogenous except at the beginning even with complete information the model has perfect equilibria with delayed agreement and or surplus destruction the model therefore explains inefficiency and destruction that may appear irrational we characterize the set of equilibrium payoffs and its limiting be haviour as the time between offers vanishes real time delay remains possible even in the limit we also consider the case of surplus destruction that is exogenously limited by the

the effects of third degree price discrimination in oligopoly retail firms and restaurants commonly offer senior citizen discounts i suspect this practice is not motivated by altruism rather the behavior can be better explained as profit maximizing price discrimination these firms are setting a low price in a market which probably has high elasticity of demand but why should the demand of senior citizens be more elastic than average one possibility is that elderly people have below average income and they would not eat out if restaurant prices were high perhaps a more plausible explanation is that retired people simply have more time on their hands to spend commuting across town to take advantage of discounts the purpose of these discounts may then be to lure senior citizens away from other restaurants rather than to get them out of the house the analysis of third degree price discrimination has a long history a c pigou 1920 joan robinson 1933 and two articles on the subject have recently appeared in this review richard schmalensee 1981 hal varian 1985 the industry structure in these analyses is monopoly but an explicit model of some form of competition is obviously needed to study discriminatory discounts meant to attract customers from rival firms and even discounts meant to get people out of the house may have an oligopoly analysis which is qualitatively different from their monopoly anlysis in this paper i present a simple duopoly model of a differentiated products industry i show that a firm s price elasticity of demand in a market can be expressed as the sum of two parts the industry demand elasticity and the cross price elasticity the first measures the tendency of consumers in a market to stay home when the price goes up the second the tendency to switch suppliers in the monopoly case in which the crossprice elasticity is zero and the collusive case in which the cross price elasticity is irrelevant discrimination between markets is due to differences in industry demand elasticity in the noncooperative oligopoly case equilibrium price differentials can be accounted for both by differences in cross price elasticity as well as differences in industry demand elasticity total industry output when the firms can discriminate between two markets is compared to what it would be if discrimination were impossible which regime has larger output depends on the sum of the adjustedconcavity condition and the elasticity ratio condition the first predominates when the rival products are poor substitutes and the firms have approximate monopoly power while the second predominates at the other extreme where the products are close substitutes and the firms have almost no market power the adjusted concavity condition compares the relative curvature of demands in the two markets and was originally discovered by robinson 1933 in her analysis of monopoly price discrimination the elasticity ratio condition compares the relative difference in industry demand elasticity between the two markets with the relative difference in cross price elasticity according to the elasticity ratio condition a discriminatory discount due to high industry elasticity of demand would be more likely to increase total output than one due to high cross price elasticity the effect of discrimination on profit is also discussed the distinction made here department of economics university of wisconsin madison madison wi 53706 this paper is a revision of part of my doctoral dissertation i am grateful to steve matthews ken judd and john panzar for guidance in this research i also thank seminar participants at wisconsin the justice department and the 1986 econometric society meetings in new orleans and the discussant martin perry the excellent comments of the referees improved the exposition of the paper

power system expansion planning under uncertainty a methodology is described for expansion planning of power systems under uncertainty in factors such as demand growth fuel cost delay in project completion and financial constraints the approach draws upon three classes of techniques decomposition and stochastic optimization provide the basic framework and allow an implicit representation of alternative investment strategies decision analysis is used to represent the dynamic aspects of decision making as uncertainties are resolved over time and hedging objectives from tradeoff analysis help select flexible and resilient expansion strategies case studies within the brazilian system are presented and discussed

evidence of directional price discrimination in the u s airline industry abstract this paper explores possible determinants that may affect an airline s decision to charge passengers different roundtrip fares depending on trip origin a case of directional price discrimination such fare differences cannot be the result of differences in cost as the cost of flying a roundtrip passenger does not significantly differ depending on direction it is argued that directional fare differences result from airlines recognizing that passenger price elasticities differ between route endpoints a price discriminating airline will then charge a higher roundtrip fare at the endpoint where the passenger price elasticity of demand is comparatively lower evidence is found suggesting that airlines do use differences in income to price discriminate when setting roundtrip fares fares are found to be 0 18 0 43 higher on average for each 1000 difference in average per capita income between origin and destination metro areas this finding is sensible assuming that higher incomes reduce the price elasticity of demand for air travel with richer passengers being less sensitive to the cost of travel

the choice of energy saving modes for an energy intensive manufacturer considering non energy benefits in practice energy intensive manufacturers have two main options when improving their energy efficiency design and implement energy efficiency projects on their own we call this self saving or enter into an energy performance contracting epc which mainly includes shared savings and guaranteed savings in this paper we will discuss an energy intensive manufacturer facing self saving and shared savings options and how this manufacturer chooses the optimal energy saving mode when non energy benefits are considered we only consider costs and profit as non energy benefits and formulate an optimization model of self saving and a stackelberg game model of shared savings from our model analysis when considering only energy savings we find that the optimal unit savings has a monotonic impact on the optimal profit of the manufacturer our results indicate that the manufacturer will prefer the second option to the first when the investment cost factor ratio of the energy service company esco to the manufacturer is small otherwise the manufacturer will prefer the first to the second furthermore when considering non energy benefits we find that the results change in some cases

strategic bargaining with destructive power abstract this note studies a two player alternating offers bargaining model in which one of the agents has the ability to damage permanently the pie bargained over beside the rubinsteinian bilateral monopoly outcome i show that it is possible to select a harming equilibrium in which the sequence of damages to the pie is endogenously determined

power generation expansion planning model towards low carbon economy and its application in china climate change poses a huge threat to human welfare hence developing a low carbon economy has become a prevailing and inevitable trend decarbonization of power generation especially converting the current power mix into a low carbon structure will be a critical option for co2 emission mitigation in this paper an integrated power generation expansion pge planning model towards low carbon economy is proposed which properly integrates and formulates the impacts of various low carbon factors on pge models in order to adapt to the characteristics of pge models based on low carbon scenario a compromised modeling approach is presented which reasonably decreases complexities of the model while properly keeping the significant elements and maintaining moderate precision degree in order to illustrate the proposed model and approach a numerical case is studied based on the background of china s power sector making decisions on the optimal pge plans and revealing the prospects and potentials for co2 emission reduction

on the strategic choice of spatial price policy the strategic incentives with respect to the choice of price policy in spatial competition are analyzed in a duopoly model price discrimination emerges as the unique equilibriu m outcome in games with either simultaneous choice of policy and pric e or sequential choice where firms may commit first to uniform mill p ricing before the actual market stage nevertheless profits may be h igher with uniform pricing the authors models are applied to analyz e some common business practices that arise in geographical pricing like the basing point system and in the pricing of varieties or opti ons from a base product in a product differentiation context copyright 1988 by american economic association

research note consumer heterogeneity and competitive price matching guarantees price matching guarantees are widely used in consumer and industrial markets previous studies argue that they are a marketing tactic that facilitates implicit price collusion this is because once a store adopts this marketing tactic its rivals can no longer steal its customers by undercutting its price and hence they have little incentive to initiate price cuts while a store with price matching guarantees has no fear of losing customers to rivals price cuts it has every incentive to raise its own price to charge a higher price to its loyal consumers a growing body of legal literature uses this argument today to justify calls for antitrust actions against stores employing this marketing tactic however this theoretical conclusion baffles practitioners and industry experts in practice sellers typically embrace this marketing tactic in response to heavier competition and a growing bargain consciousness among shoppers the introduction of price matching guarantees by a store is frequently interpreted by industry observers as the initiation of a price war rather than a signal of price collusion this assertion is supported in many instances by the fact that stores that introduce price matching guarantees also roll back their prices and typically suffer subsequent loss of profits most ironically the favorite examples used by researchers to illustrate how price matching guarantees can enforce price collusion crazy eddie and nobody beats the wiz have subsequently either gone bankrupt or filed for federal bankruptcy protection in this study we show that price matching guarantees can indeed facilitate competition the expected prices and profits can be strictly lower when all stores adopt price matching guarantees than when they are not allowed to this is because the adoption of price matching guarantees generates not only a competition dampening effect which has been recognized in the literature but also a competition enhancing effect this latter effect comes from the fact that price matching guarantees encourage price search by those consumers who prefer to shop at a particular store but are mindful of saving opportunities these consumers will have incentives to obtain the rival store s price when their favorite store offers price matching guarantees to avail themselves of the lowest possible price at their favorite store as a result price matching guarantees reduce the number of purchases at the store from those consumers who would have paid the full price and thus prompt a store to price more aggressively to bid for more incremental sales this competition enhancing effect can more than offset the competition dampening effect in markets where consumers differ in their price search costs and store loyalty thus our study casts doubt on the advisability of blanket prohibition on price matching guarantees our argument relies only on consumer segmentation and on the phenomenon of periodic sales both of which are common in retail markets we arrive at our conclusion by incorporating bargain shoppers and opportunistic loyals into the standard sales promotion models in contrast the past literature on price matching guarantees ignores the ubiquitous phenomenon of sales in retail markets and overlooks those consumers who prefer to shop at a particular store but are alert to saving opportunities as a result it is troubled by two awkward conclusions on the one hand price matching guarantees simply remove rivals incentives to undercut in price and hence also their incentives to run sales this implies that the adoption of price matching guarantees in a market will eliminate the phenomenon of sales which is obviously counterfactual on the other hand in equilibrium no consumer actually invokes price matching guarantees as each player has incentives to close any price gap in the market this is obviously false based on our casual observations and our conversations with store managers theoretical research on the subject thus far has been overwhelmingly one sided and empirical or experimental studies are conspicuously lacking we hope that our conclusion will spark further research in both directions a healthy debate will broaden our perspective on an issue of great importance in formulating public policies and in managerial decision making

a one period memory folk theorem for multilateral bargaining games we study strategies with one period recall in the context of a general class of multilateral bargaining games a strategy has one period recall if actions in a particular period are only conditioned on information in the previous and the current period we show that if players are sufficiently patient given any proposal in the space of possible agreements there exists a subgame perfect equilibrium such that the given proposal is made and unanimously accepted in period zero as a corollary we derive that also perpetual delay can be sustained as a subgame perfect equilibrium our strategies are pure and have one period recall and we do not make use of a public randomization device the players discount factors are allowed to be heterogeneous we also construct a finite automata representation of our strategy profile

outside options in a bargaining model with decay in the size of the cake abstract a simple bargaining model in which the cake decays over time at a positive rate is analysed in the limit the unique perfect equilibrium payoffs take the split the difference form these results generalise to three party bargaining

why do manufacturers issue coupons an empirical analysis of breakfast cereals we explore the relationship between shelf prices and manufacturers coupons for 25 readyto eat breakfast cereals we find that shelf prices are lower during periods when coupons are available this result is inconsistent with static monopoly price discrimination under a broad range of assumptions we present evidence that is inconsistent with both dynamic theories of price discrimination and explanations of couponing based on the vertical relationship between manufacturers and retailers we find support for models of price discrimination in oligopoly settings as well as suggestions that firmwide incentives may induce managers to use coupons and price cuts simultaneously finally lagged coupons have a positive effect on current sales suggesting that coupons are used to induce repurchase

electricity generation from renewables in madagascar opportunities and projections climate change is the greatest challenge of our time for development adaptation to this change combined with the reduction of greenhouse gas emissions can help to boost the economic transformation which stimulates growth fills the energy gap and reduces poverty this paper focuses on the potential of renewable energy sources res for electricity generation in madagascar which is a lower income country a large accessibility to electricity could be a driving force for the economic development of this fourth worldwide island the electricity mix is currently heavily dependent to fossil fuel imports indeed most of the electric demands are fulfilled by diesel power plants an overview of the power situation and renewable energy potential of madagascar is first presented then different scenarios for the evolution its electricity mix are proposed

bargaining and reputation the paper develops a reputation based theory of bargaining the idea is to investigate and highlight the influence of bargaining postures on bargaining outcomes a complete information bargaining model a la rubinstein is amended to accommodate irrational types who are obstinate and indeed for tractability assumed to be completely inflexible in their offers and demands a strong independence of procedures result is derived after initial postures have been adopted the bargaining outcome is independent of the fine details of the bargaining protocol so long as both players have the opportunity to make offers frequently the latter analysis yields a unique continuous time limit with a war of attrition structure in the continuous time game equilibrium is unique and entails delay consequently inefficiency the equilibrium outcome reflects the combined influence of the rates of time preference of the players and the ex ante probabilities of different irrational types as the probability of irrationality goes to zero delay and inefficiency disappear furthermore if there is a rich set of types for both agents the limit equilibrium payoffs are inversely proportional to their rates of time preference

spatial differentiation and price discrimination in the cement industry evidence from a structural model we estimate a structural model of the cement industry that incorporates spatial differentiation and price discrimination focusing on the us southwest over 1983 2003 we leverage the structure of the model to obtain consistent estimates of the underlying parameters using data on market outcomes that are substantially aggregated our results indicate that transportation costs around 0 46 per tonne mile rationalize the data this friction enables relatively isolated plants to obtain higher prices from nearby customers we further find that disallowing price discrimination would create 30 million in consumer surplus annually and show how the model can identify suitable divestitures in merger analysis

revocable commitment and sequential bargaining in this paper the author presents a noncompetitive bargaining model which unifies the two well known but distinct bargaining games due to j nash 1953 and a rubinstein 1982 moreover the author explores the robustness of the equilibrium set of these two bargaining games to a particular kind of perturbation in the commitment structure of the underlying extensive forms from a different perspective and interpretation of the model the author examines and studies the relationship between the equilibrium commitment levels and the costs to the bargainers of revoking their respective commitments copyright 1992 by royal economic society

a multilateral telephone bargaining game abstract this paper studies a multilateral bargaining game with unanimity rule offers and responses are communicated through private telephone conversations and they are never revealed to all players with a plausible restriction on beliefs we obtain a unique perfect public equilibrium

a bargaining model based on the commitment tactic abstract this paper studies a one shot simultaneous move bargaining game each bargainer makes a partial commitment a share of the unit size cake that she would like to get which can later be revoked at some cost to the player the payoffs are defined in part by the nash bargaining solution where the feasible utility set is affected by the players partial commitments under certain assumptions on the two cost of revoking functions we establish that the model has a unique nash equilibrium it is shown that a player s equilibrium share of the cake is strictly increasing in her marginal cost of revoking a partial commitment an application of our model selects a unique equilibrium in nash s demand game journal of economic literature classification number c78

on the convergence to the nash bargaining solution for action dependent bargaining protocols we consider a non cooperative multilateral bargaining game and study an action dependent bargaining protocol that is the probability with which a player becomes the proposer in a round of bargaining depends on the identity of the player who previously rejected an important example is the frequently studied rejector becomes proposer protocol we focus on subgame perfect equilibria in stationary strategies which are shown to exist and to be efficient equilibrium proposals do not depend on the probability to propose conditional on the rejection by another player we consider the limit as the bargaining friction vanishes in case no player has a positive probability to propose conditional on his rejection each player receives his utopia payoff conditional on being recognized otherwise equilibrium proposals of all players converge to a weighted nash bargaining solution where the weights are determined by the probability to propose conditional on one s own rejection

promoting energy efficiency financing and escos in developing countries mechanisms and barriers abstract developing countries have tremendous potential to increase energy efficiency but face several barriers before the potential can be realised a lack of access to appropriate financing mechanisms is one of the important barriers energy service companies escos a market oriented mechanism to improve energy efficiency had successful experiences in developed countries such as the usa and canada and developing countries such as south korea escos are in nascent stage in many developing countries and face several barriers that include market finance and institutional barriers poor energy pricing policies high transaction costs etc market development through active involvement of governments as a customer information provider and policy maker is required to promote escos development of specialised energy efficiency financing windows in appropriate financial institutions development of skills for energy efficiency project appraisal and design of specialised financial products are other measures to accelerate the diffusion of energy efficiency

a critical review of china s rapidly developing renewable energy and energy efficiency policies renewable energy and energy efficiency reee policies have far reaching implications for energy security climate change economic competitiveness pollution and human livelihood for these reasons reee has become a national priority for the chinese government particularly since 2005 this paper aims to critically review china s reee policies in six sectors electricity industry transportation buildings and local government in addition to examining the progress china has made in the development and implementation of reee policies this review also identifies limitations and room for improvement finally five policy recommendations are presented

distribution of surplus in sequential bargaining with endogenous recognition i examine a sequential bargaining situation in which agents contest the right to propose an allocation the contest can either take place at a pre bargaining stage yielding persistent recognition to propose or recur throughout the bargaining yielding transitory recognition equilibrium analysis reveals that surplus is distributed more unequally under persistent recognition social cost is higher under persistent recognition if and only if it attracts a sufficient number of active bargainers and individual s incentive to propose under transitory recognition may actually increase in the number of agents while this incentive always diminishes under persistent recognition

a noncooperative theory of coalitional bargaining the authors explore a sequential offers model of n person coalitional bargaining with transferable utility and with time discounting their focus is on the efficiency properties of stationary equilibria of strictly superadditive games when the discount factor delta is sufficiently large it is shown that delay and the formation of inefficient subcoalitions can occur in equilibrium the latter for some or all orders of proposer however efficient stationary equilibrium payoffs converge to a point in the core as delta approaches one strict convexity is a sufficient condition for there to exist an efficient stationary equilibrium payoff vector for sufficiently high delta

carbon intensity in production and the effects of climate policy evidence from swedish industry we analyze carbon intensity performance at firm level and the effectiveness of the swedish co2 tax carbon intensity performance is derived from a production technology and measured as changes in t

the dominant firm advantage in multiproduct industries evidence from the u s airlines in many industries the largest firms are most successful in entering and competing in individual markets or submarkets while this success is often attributed to cost or quality differences it may also reflect reputation advantages or marketing strategies that benefit firms selling a wider variety of products in the industry i present an approach to estimating the advantages of a dominant firm in the airline industry that allows one to effectively control for cost and quality heterogeneity results using data from 1986 indicate that an airline with a dominant presence at an airport will have a significant advantage in attracting customers whose trips originate at that airport regardless of the specific route on which the customer is traveling