the economics of a blend mandate for biofuels a biofuel blend mandate may increase or decrease consumer fuel prices with endogenous oil prices depending on relative supply elasticities biofuel tax credits always reduce fuel prices tax credits result in lower fuel prices than under a mandate for the same level of biofuel production if tax credits are implemented alongside mandates then tax credits subsidize fuel consumption instead of biofuels this contradicts energy policy goals by increasing oil dependency co 2 emissions and traffic congestion while providing little benefit to either corn or ethanol producers these social costs will be substantial with tax credits costing taxpayers 28 7 billion annually by 2022 copyright 2008 oxford university press

demand elasticities for food products in brazil a two stage budgeting system the object of this article is to estimate demand elasticities for a basket of staple food important for providing the caloric needs of brazilian households these elasticities are useful in the measurement of the impact of structural reforms on poverty a two stage demand system was constructed based on data from household expenditure surveys pof produced by ibge the brazilian bureau of statistics in 1987 88 and 1995 96 we have used panel data to estimate the model and have calculated income own price and cross price elasticities for eight groups of goods and services and in the second stage for 11 sub groups of staple food products we estimated those elasticities for the whole sample of consumers and for two income groups

doomed from the start what is the value of selecting a future dominant design this study investigates how important it is for a firm to select what turns out to be a dominant design in a technology driven industry using the personal computer industry as a case study this research shows that firms are not doomed when their entry design choices turn out to be wrong for early entrants we found that switching to the dominant design is associated with increased chances of survival and market share contrary to our expectations we found that even later entrants that switched to the dominant design also enjoyed higher survival rates and greater market position copyright 1999 john wiley sons ltd

who pays and who gains from fuel policies in brazil abstract brazil has pursued a mix of policy interventions in the fuel sector to achieve multiple objectives of economic and social development promoting biofuels and reducing dependence on oil we develop an economic framework to provide insight on the fuel policy choices in brazil and to analyze the trade offs they have engendered in the fuel and sugar sectors we also examine their distributional impacts on producers and consumers in the sugar oil and biofuel sectors and on government revenues additionally we undertake a normative analysis for the purpose of comparing the welfare and environmental impacts of existing policies with those justified by the goal of maximizing social welfare and addressing market failure the ex post analysis of the outcomes for different stakeholders in the fuel and sugar sectors provides insights on the likely political economic factors guiding policy choices we find that the status quo policies are likely to have been motivated by the objectives of increasing oil exports raising government revenue and promoting rural development through the sugarcane sector and have had a significant adverse effect on fuel and sugar consumers aggregate social welfare and greenhouse gas emissions in brazil

weak separability and the estimation of elasticities in multistage demand systems the necessary conditions for multistage budgeting to be at least approximately justified are reviewed and the plausibility of these assumptions i e weak separability and low variability of price indices with utility level are discussed using no further assumptions simple relationships between expenditure and price elasticities in different budgeting levels are derived these results are applied to a three stage model for swedish food consumption and it is shown that the assumptions are not inappropriate restricting the analysis to the last stage of a multistage budgeting process is also shown to lead to considerable errors which could well have policy consequences

configuration of value chain activities the effect of pre entry capabilities transaction hazards and industry evolution on decisions to internalize we integrate insights from organizational capabilities organizational economics and industry evolution to examine industry entrants boundary choices about value chain activities and test hypotheses in 1978 2009 data from a sample of u s bioethanol producers we find support for our predictions that transaction hazards decomposed as either enduring or transient over the stages of industry evolution are positively associated with the choice to internalize value chain activities pre entry experience in an activity increases the likelihood of its internalization and reduces the effect of enduring transaction hazards on the internalization choice importantly we also distinguish between firm and founder level pre entry capabilities that is the capabilities of firms versus those of founders diversifying entrants with firm level integrative capabilities are more likely to internalize value chain activities than start ups and this effect persists over the industry s life cycle the relationship between pre entry experience with an activity and the likelihood of internalizing it is also stronger for diversifying entrants findings improve understanding of the relationships among capability development boundary choice and industry evolution

welfare effects of expansions in equilibrium models of an electricity market with fuel network the welfare of electricity producers and consumers depends on congestion in the transmission grid generation costs that consist mainly of fuel costs and strategic behavior we formulate a game theoretic model of an oligopolistic electricity market where generation costs are derived from a fuel supply network the game consists of a fuel dispatcher that transports fuels at minimum cost to meet generator demands generators that maximize profit in cournot competition and an independent system operator iso that sets nodal prices to balance electricity supply with linear demand functions we prove the existence of an equilibrium if fuel supplies are unlimited the same equilibria hold in a simplified version of the game in which each generator optimizes its fuel acquisition from the network in some very simple examples under different assumptions about the rationality of generators with respect to iso decisions paradoxical effects on total welfare can occur from expanding either electricity transmission capacity or the transportation capacity of low cost fuel we find some instances in which the paradox occurs only under bounded rationality of the generators others where it occurs only if the generators are fully rational and still others where it occurs to different degrees under the two rationality assumptions

a multiperiod generalized network flow model of the u s integrated energy system part i model description this paper is the first of a two part paper presenting a multiperiod generalized network flow model of the integrated energy system in the united states part i describes the modeling approach used to evaluate the economic efficiencies of the system wide energy flows from the coal and natural gas suppliers to the electric load centers under the proposed problem formulation fuel supply and electricity demand nodes are connected via a transportation network and the model is solved for the most efficient allocation of quantities and corresponding prices the methodology includes physical economic and environmental aspects that characterize the different networks part ii of this paper provides numerical results that demonstrate the application of the model

asset specificity and economic organization abstract this paper examines the optimization problem of firm and market organization in which both production cost and transaction cost differences are expressed as a function of asset specificity in general markets enjoy advantages by aggregating the demands of many buyers thereby realizing economies of scale or scope such production cost savings need to be assessed in relation to the transaction cost advantages that internal organization sometimes enjoys over markets in adapting to changed circumstances as it turns out both production cost economies and the transaction cost differences between firm and market organization vary systematically with the characteristics of the investments this paper employs a unified framework to assess the choice of organization form the condition of asset specificity is featured

stochastic security for operations planning with significant wind power generation in their attempt to cut down on greenhouse gas emissions from electricity generation several countries are committed to install wind power generation up to and beyond the 10 20 penetration mark however the large scale integration of wind power represents a challenge for power system operations planning because wind power 1 cannot be dispatched in the classical sense and 2 its output varies as weather conditions change this warrants the investigation of alternative short term power system operations planning methods capable of better coping with the nature of wind generation while maintaining or even improving the current reliability and economic performance of power systems to this end this paper formulates a short term forward electricity market clearing problem with stochastic security capable of accounting for nondispatchable and variable wind power generation sources the principal benefit of this stochastic operation planning approach is that when compared to a deterministic worst case scenario planning philosophy it allows greater wind power penetration without sacrificing security

units of measurement and the stone index in demand system estimation the stone index typically used in estimating linear almost ideal demand systems is not invariant to changes in units of measurement which may seriously affect the approximation properties of the model a modification to the stone index or use of a regular price index instead are both desirable practices in estimating linear ai models

welfare impacts of alternative biofuel and energy policies an open economy equilibrium model is derived to investigate the effects of energy policy on the u s economy with emphasis on corn based ethanol a second best policy of a fuel tax and ethanol subsidy is found to approximate fairly closely the welfare gains associated with the first best policy of an optimal carbon tax and tariffs on traded goods the largest economic gains to the u s economy from these energy policies arise from their impact on u s terms of trade particularly in the oil market conditional on the current fuel tax an optimal ethanol mandate is superior to an optimal ethanol subsidy copyright 2011 oxford university press

impacts of us biodiesel mandates on world vegetable oil markets abstract in this paper we seek to understand the impact of expanded use of soybean oil biodiesel to address biofuel mandates on global vegetable oil markets and in particular on the demand for palm oil an open economy equilibrium model is derived to investigate the market effects of biodiesel expansion on related energy and vegetable oil markets the model is calibrated to represent the recent benchmark data in calendar year 2014 the simulation estimates suggest that the expanded use of soy oil for biodiesel in the us will have considerable impacts on world vegetable oil markets the majority of the vegetable oil replacement is likely to occur through substitution of palm oil under a wide range of plausible elasticity values on the demand for vegetable oil and the demand substitution between soy oils and palm oils

dynamic economic dispatch feasible and optimal solutions dynamic economic dispatch is an extension of the conventional economic dispatch problem that takes into consideration the limits on the ramp rate of the generating units this paper examines the factors that affect the feasibility and optimality of solutions to this problem it proposes two new solution methods the first is guaranteed to find a feasible solution even when the load profile is nonmonotonic the second is an efficient technique for finding the optimal solution the results obtained with these methods are compared with those obtained using previously published methods

maintaining and testing separability in demand systems we derive a general elasticity representation of the necessary and sufficient conditions for direct weak separability of the utility function parametric restrictions required to implement the separability conditions are presented for three common demand systems the almost ideal translog and rotterdam our empirical application uses the rotterdam model to test a few separable structures within a complete u s demand system emphasizing food commodities results based on size corrected likelihood ratio tests provide support for commonly used separability assumptions about food and meat demand

does transaction misalignment matter for firm survival at all stages of the industry life cycle research on industry life cycles suggests that competitive pressures are more severe during the shakeout stage which could be associated with the emergence of a dominant design than at other stages transaction cost theory on the other hand assumes generally competitive markets and does not address the industry life cycle it therefore implies that transaction cost economizing is a superior firm strategy regardless of the stage of the life cycle this paper seeks to reconcile these two streams of research by investigating whether aligning transactions with governance modes in accordance with transaction cost prescriptions has a differential effect on firm survival in preshakeout versus shakeout stages of the industry life cycle analyzing data from the early u s auto industry 1917 1933 we find that while transaction misalignment did not have a significant impact on firm survival during the preshakeout stage or during the period as a whole it did have a significantly larger negative impact on survival during the shakeout stage than during the preshakeout stage we also find that the negative effects of misalignment on survival were significantly weaker for larger firms during the shakeout stage this suggests that applications of transaction cost theory which assume uniformly severe selection pressures across the industry life cycle and uniform effects of misalignment across firms of different sizes could be misleading it also suggests that theories of the industry life cycle could usefully take transaction costs into account along with production costs in their analyses of competition over the life cycle

firm survival and industry evolution in vertically related populations this paper examines how the density and governance of vertically related populations affect the life chances of organizations we integrate the literatures on organizational ecology and vertical integration to develop a theory of how 1 specialized upstream industries affect downstream survival rates 2 the prevalence of different governance forms among upstream and downstream organizations moderates this relationship and 3 different forms of governance exert differential competitive pressures on focal organizations we find evidence supporting our hypotheses in an empirical examination of the downstream laser printer industry and upstream laser engine industry this paper was accepted by jesper sorensen organizations

a multi period market design for markets with intertemporal constraints the participation of renewable energy storage and resources with limited fuel inventory in electricity markets has created the need for optimal scheduling and pricing across multiple market intervals for resources with intertemporal constraints in this paper a new multi period market model is proposed to enhance the efficiency of markets with such type of resources it is also the first market design that links a forward market and a spot market through the coordination of schedule and price under the multi period paradigm achieving reliability economic efficiency and dispatch following incentives simultaneously the forward market solves a multi period model with a long look ahead time horizon whereas the spot market solves a series of multi period dispatch and pricing problems with a shorter look ahead time horizon on a rolling basis by using the forward schedules and opportunity costs of intertemporal constraints as a guideline the spot market model is able to produce economically efficient dispatch solutions as well as prices that incentivize dispatch following under the perfect forecast condition the proposed scheme is applied to the dispatch and pricing of energy storage resources numerical experiments show that the proposed scheme outperforms the traditional myopic method in terms of economic efficiency dispatch following and reliability

stochastic optimization model to study the operational impacts of high wind penetrations in ireland a stochastic mixed integer linear optimization scheduling model minimizing system operation costs and treating load and wind power production as stochastic inputs is presented the schedules are updated in a rolling manner as more up to date information becomes available this is a fundamental change relative to day ahead unit commitment approaches the need for reserves dependent on forecast horizon and share of wind power has been estimated with a statistical model combining load and wind power forecast errors with scenarios of forced outages the model is used to study operational impacts of future high wind penetrations for the island of ireland results show that at least 6000 mw of wind 34 of energy demand can be integrated into the island of ireland without significant curtailment and reliability problems

fuel demand in brazil in a dynamic panel data approach abstract the purpose of this paper is to evaluate the sensitivity of fuel consumers regarding price and income taking recent changes in the brazilian fuel market into account in this market new market rules energy policy towards fuel diversification and introduction of flex fuel engines have determined fuel competition among gasoline ethanol and compressed natural gas using a dynamic panel data model demand equations for these three fuels are econometrically estimated to obtain consumer adjustment coefficients price cross price and income elasticities in the short and long run in addition the effect of the introduction of flex fuel engines in the market and the rationality of consumers towards efficiency constraints of the engines were tested apart from considerable competition results show that the dynamics of the brazilian fuel market revolves around ethanol instead of gasoline while demands for gasoline and natural gas are inelastic to price demand for ethanol is elastic in brazil furthermore after the introduction of the flex fuel technology the sensitivity of consumers to fuel prices changed and ethanol consumers take efficiency constrains into account when ethanol prices reach the threshold of 70 of gasoline prices

firm survival and the evolution of oligopoly after their commercial introduction the number of producers of autos tires televisions and penicillin initially grew and then experienced a sharp decline or shakeout guided by an evolutionary model of entry and exit firm survival patterns in the four products are examined to determine whether there were common forces governing their distinctive evolution predictions concerning the effects of pre and post entry experience and the timing of entry on firm survival are tested the findings are used to reflect on why industries experience shakeouts and evolve to be oligopolies

deliverable robust ramping products in real time markets the increasing penetration of variable energy resources has led to more uncertainties in power systems flexible ramping products frp have been adopted by several electricity markets to manage the uncertainties we reveal that neglected line congestion for frp may not only cause infeasibility but also result in a failure of cost recovery to address the deliverability issues on frp this paper proposes a new concept deliverable robust ramping products drrp in real time markets the drrp includes generation ramping reserve and generation capacity reserve the drrp is deliverable and immunized against any predefined uncertainty it also fully addresses the bid cost recovery issue caused by the line congestion in existing frps the prices of drrp are derived within the affine adjustable robust optimization aaro framework these prices can be used to identify valuable reserves among available reserves and quantify the values of flexible resources that provide reserves this paper also proposes a general approach to obtaining the time decoupled prices for drrp and generation which can be used for the market settlement of the first interval only in real time markets simulations on a 3 bus system and the ieee 118 bus system are performed to illustrate the concept of drrp and the advantages of drrp compared to existing frp

consumer behaviour theory and empirical evidence a survey this survey is designed to emphasize the relationship between empirical a nd theoretical considerations in the analysis of consumer behavior a lthough it focuses primarily on analysis at the individual or micro l evel it tries where possible to draw implications for the estimati on of aggregate relationships the importance of micro level analysis stems from the rapid expansion in available panel and survey data se ts this development has generated its own theoretical and empirical issues many of which are raised in this survey copyright 1988 by royal economic society

complementarities and coordination implications for governance mode and performance of multiproduct firms we explore the fit between a firm s product portfolio strategy and its governance mode with respect to complementary activities that underlie its product offering we view firm s governance choice through the lens of orchestrating complementary activities that entail multiple interrelated and often simultaneously occurring transactions our key premise is that a broader product portfolio while offering benefits through the bundle of complementary activities raises the coordination costs for firms making integration of complementary activities a preferred mode of governance we find strong support for our arguments in the context of the u s healthcare industry hospitals with a narrow service portfolio are more likely to have contracts with physicians as external service providers and hospitals with a broad service portfolio are more likely to employ their own physicians moreover hospitals that deviate from this fit based relationship suffer a significant penalty in terms of their financial performa

the moderating role of submarket dynamics on the product customization firm survival relationship in this paper we examine how the provision of product customization services affects firm survival integrating literatures on industry evolution product related adapting services and entry deterrence we hypothesize that the relationship between product customization the costly modification of a product to cater to customer needs and firm survival differs across industries based on the extent of submarkets we argue that in industries that feature submarkets more prominently the positive association between product customization and firm survival is stronger for two conceptually distinct and empirically distinguishable mechanisms customizing firms enter new submarkets and also deter potential entry we conclude that offering product customization services has strategic benefits that sometimes outweigh the cost of coordinating with customers

empirical regularities in south african consumption patterns this article investigates a number of empirical regularities in the south african consumption patterns the data support the following empirical regularities 1 variability in consumption systematically exceeds the variability in prices 2 law of demand 3 income flexibility is about 0 5 4 engel s law and 5 the demand hypotheses demand homogeneity and slutsky symmetry are acceptable in contrast to the findings for a number of other countries another important empirical regularity that consumer s utility function is additive is rejected for the south african consumers based on the implied demand elasticity estimates from the preferred model it is found that food housing and medical care are necessities and clothing furniture transport and recreation are luxuries and demand for all the commodities are price inelastic

quadratic engel curves and consumer demand this paper presents a model of consumer demand that is consistent with the observed expenditure patterns of individual consumers in a long time series of expenditure surveys and is also able to provide a detailed welfare analysis of shifts in relative prices a nonparametric analysis of consumer expenditure patterns suggests that engel curves require quadratic terms in the logarithm of expenditure while popular models of demand such as the translog or the almost ideal demand systems do allow flexible price responses within a theoretically coherent structure they have expenditure share engel curves that are linear in the logarithm of total expenditure we derive the complete class of integrable quadratic logarithmic expenditure share systems a specification from this class is estimated on a large pooled data set of u k households models that fail to account for engel curvature are found ro generate important distortions in the patterns of welfare losses associated with a tax increase

second best biofuel policies and the welfare effects of quantity mandates and subsidies abstract the quest for biorenewable energy sources is held to justify a number of government interventions including support policies for biofuels such as those responsible for the recent rapid growth of us ethanol production this article provides an analytical assessment of such policies we construct a general equilibrium open economy model that captures the rationale typically invoked to justify government intervention in this setting to alleviate the environmental impact of energy consumption and to decrease us energy dependence on foreign sources the model is used to study both the positive and normative implications of alternative policy instruments including the subsidies and mandates specified by the 2007 energy independence and security act from a positive perspective we find that biofuels mandates are equivalent to a combination of fuel taxes and biofuels subsidies that are revenue neutral from a welfare perspective we show that biofuels mandates dominate biofuels subsidies and that combining fuel taxes with mandates would be welfare enhancing

estimation of an implied price elasticity of demand through current pricing practices researchers have long pursued better methods to estimate price elasticity of market level demand due to a plethora of empirical problems the estimates produced in many empirical studies leave researchers with wide confidence intervals that do little to clarify demand conditions as a result these estimates are of limited practical use to the firm facing a firm level demand here a non statistical methodology based on seller optimization behaviour is applied that creates an implied elasticity of firm level demand that is robust intuitively plausible and free of oppressive data requirements these elasticities are tested in an applied setting against pricing managers surveyed estimates for customer price sensitivity for freight rail transportation services and it is found that the estimate is consistent with their pricing behaviour this methodology is recommended for creating a simple plausible starting point estimate for firm level price elasticities or using this calculation as an input to stat

pricing energy and ancillary services in integrated market systems by an optimal power flow a detailed ac opf based formulation for procuring pricing and settling energy and ancillary service in simultaneous auctions by integrated market systems is presented the paper provides clear definitions of locational marginal prices for energy and ancillary service marginal prices in terms of lagrange multipliers the characteristics of the prices are analyzed especially when economic substitution among ancillary services is required the paper also evaluates the conditions under which opportunity costs are incurred to units that provide ancillary services it is particularly shown that the intuitive belief that the provision of regulation down service does not incur opportunity cost to the provider in general is not true

long run income and price elasticities of demand for colombian nontraditional exports a multivariate cointegration framework a long run income and price elasticities of demand is estimated for colombian nontraditional exports through a multivariate cointegration analysis based on the combination of cointegration and exogeneity concepts and the inclusion of the complete dynamic system the paper shows the existence of a long run relationship among nontraditional exports relative price and foreign demand and higher long run elasticities than those provided by the long run cointegration vector coefficients that are usually reported in the trade literature

scheduling and pricing for expected ramp capability in real time power markets higher variable renewable generation penetrations are occurring throughout the world on different power systems these resources increase the variability and uncertainty on the system which must be accommodated by an increase in the flexibility of the system resources in order to maintain reliability many scheduling strategies have been discussed and introduced to ensure that this flexibility is available at multiple timescales to meet variability that is the expected changes in system conditions two recent strategies have been introduced time coupled multi period market clearing models and the incorporation of ramp capability constraints to appropriately evaluate these methods it is important to assess both efficiency and reliability but it is also important to assess the incentive structure to ensure that resources asked to perform in different ways have the proper incentives to follow these directions which is a step often ignored in simulation studies we find that there are advantages and disadvantages to both approaches we also find that look ahead horizon length in multi period market models can impact incentives this paper proposes scheduling and pricing methods that ensure expected ramps are met reliably efficiently and with associated prices based on true marginal costs that incentivize resources to do as directed by the market case studies show improvements of the new method

is utility additive further evidence this paper investigates the question of additive structure of the utility function using the data for nine broad commodity groups from 45 countries further evidence is presented in support of the preference independent utility structure

short run long run and cross elasticities of gasoline demand in brazil gasoline is one of the most important of the oil derived products its importance is closely related to its participation in the value of imports of many countries and in a number of cases it is one of the determinants of their balance of payment deficit fiscal deficit and economic growth as opposed to most nations brazil has had a gasoline substitute since 1985 alcohol many studies have tried to estimate the income and price elasticities of the demand for gasoline in several countries this paper extends previous studies by estimating the cross price elasticity between gasoline and alcohol our findings indicate that alcohol is an imperfect substitute for gasoline even in the long run as a consequence the need for a new fuel substitution must be initiated long before petroleum reserves vanish

generational technological change effects of innovation and local rivalry on performance we tested the effects of innovation and market complexity on firm performance generational technological change a major advance within a technology regime fosters the emergence of niches and local

assessing environmental economic and reliability impacts of flexible ramp products in miso s electricity market abstract increased variability and uncertainty of net electrical load due to high penetration of wind and solar power augments the need for dispatching conventional generators with sufficient ramping capability rc needed to balance demand with supply having sufficient rc reduces the need of last minute dispatch schedule modifications which cause cost reliability and environmental outcomes that reduce the benefits of renewables the midcontinent independent system operator miso has modified its unit commitment and economic dispatch algorithms to account for the economic value of provisioning adequate rc levels this paper explores the outcomes of this modified market clearing process by simulating 10 minute operations of a scaled miso test system for three representative months under low and high wind penetration scenarios changes in system performance are quantified by comparing system costs scarcity events pricing energy prices generation fuel mix wind power curtailment and co 2 emissions between the conventional market clearing algorithm and one with flexible rc products results indicate that adding rc products lowers co 2 emissions and system costs facilitates wind integration and improves reliability these benefits are robust to changes in the market clearing algorithm parameters such as over under generation penalties and reserve scarcity prices

electricity and natural gas interdependency comparison of two methodologies for coupling large market models within the european regulatory framework power generation growth based on natural gas fired power plants ngfpps has lead to increasing interactions between electric power and natural gas industries more companies are progressively and simultaneously participating as big players in both markets however each company has traditionally been settled in one side holding a particular competitive advantage electric power generation companies mainly know how to operate their generation assets whereas gas companies mainly know how to manage their gas supply contracts and make use of often regulated gas assets multi product energy companies have even created independent departments which decisions are usually taken uncoordinatedly in any case companies or departments usually support their decision making process in mathematical tools which represent each market with detail this paper presents two methodologies for coupling two interdependent electricity and gas market models formulated as optimization problems each methodology fulfills different department wishes the electricity perspective methodology maximizes electricity market profits after calculating equivalent gas contracts with the gas market model in contrast the gas perspective methodology minimizes gas operation costs after obtaining the relationship between the marginal revenue and the gas consumption with the electricity market model this coordinated solution would allow companies to obtain synergies resulting in a competitive advantage over other companies that operate uncoordinatedly in both markets

perspective explaining influence rents the case for an institutions based view of strategy research in strategy has identified and tried to explain four types of rents monopolistic rents efficiency rents quasi rents and schumpeterian rents building on previous work on political and institutional strategies we add a fifth type of rent influence rents influence rents are the extra profits earned by a firm because the rules of the game laws regulations and informal rules are designed or changed to suit it to aid the analysis of the relationship between institutional context and firm performance and to provide a structure to guide research we develop a framework with five key components a an identification of the five fundamental problems of a market economy b a typology that describes the five different types of institutions that emerge to solve these problems c the market ordering mechanisms used by institutions to solve these problems d the common causes of weak institutional performance and e generic strategies used by firms to exploit these weaknesses of an institutional context to enhance firm performance we highlight potential applications of the framework as well as an illustrative research agenda that can advance the development of theory to explain the emergence and persistence of influence rents

coal lumps vs electrons how do chinese bulk energy transport decisions affect the global steam coal market this paper demonstrates the ways in which dierent chinese bulk energy transport strategies aect the future steam coal market in china and in the rest of the world an increase in chinese demand for steam coal will lead to a growing need for additional domestic infrastructure as production hubs and demand centers are spatially separated and domestic transport costs could inuence the future chinese steam coal supply mix if domestic transport capacity is available only at elevated costs chinese power generators could turn to the global trade markets and further increase steam coal imports increased chinese imports could then yield signicant changes in steam coal market economics on a global scale this eect is analyzed in china where coal is mainly transported by railway and in another setting where coal energy is transported as electricity for this purpose a spatial equilibrium model for the global steam coal market has been developed one major nding is that if coal is converted into electricity early in the supply chain worldwide marginal costs of supply are lower than if coal is transported via railway furthermore china s dependence on international imports is signicantly reduced in this context allocation of welfare changes particularly

a multiperiod generalized network flow model of the u s integrated energy system part ii simulation results this paper is the second of a two part paper and describes the application of a multiperiod generalized network flow model that is used to analyze the economic efficiencies of the energy movements from the coal and natural gas suppliers to the electric load centers providing a simulation tool that captures dynamics of and interdependencies between the coal natural gas and electricity networks the modeling approach mathematical formulation and modeling assumptions are presented in part i this sequel presents and discusses numerical results to illustrate the application of the model the model enables public and private decision makers to carry out comprehensive analyses of a wide range of issues related to the energy sector such as strategic planning economic impact assessment and different regulatory regimes

can the survivor principle survive diversification the survivor principle holds that the competitive process weeds out inefficient firms so that hypotheses about efficient behavior can be tested by observing what firms actually do this principle underlies a large body of empirical work in strategy economics and management but do competitive markets really select for efficient behavior is the survivor principle reliable we evaluate the survivor principle in the context of corporate diversification asking if survivor based measures of interindustry relatedness are good predictors of firms decisions to exit particular lines of business controlling for other firm and industry characteristics that affect firms portfolio choices we find strong robust evidence that survivor based relatedness is an important determinant of exit this empirical regularity is consistent with an efficiency rationale for firm level diversification though we cannot rule out alternative explanations based on firms desire for legitimacy by imitation and attempts to temper

the evolution of new industries and the determinants of market structure several empirical regularities concerning firm growth rates and industry firm size distributions have been developed by studying primarily mature industries the primary purpose of this article is to bring together and extend empirical regularities on the evolution of new industries and to use these regularities to gain further insight into the forces governing industry evolution to explain these regularities a model is constructed which emphasizes how factors governing the early evolution of industries may shape their market structure at maturity it stresses how chance events and exogenous factors that influence the number of potential entrants to the industry the growth rate of incumbents and the ease of imitation of industry leaders will influence the ultimate number and size distribution of firms in the industry

the evolving design of rto ancillary service markets abstract although the markets for ancillary services at the north american independent system operators are often structured in quite different ways there is an emerging set of core design elements that represent a rough consensus as to what the optimal design configuration for ancillary services should be albeit with some regional variation this paper looks back at how the design of ancillary services markets has recently evolved to put this development in context thereafter it examines the methods by which ancillary services are procured by highlighting the procurement practices at a number of different independent system operators principally those in california new york new england texas and the pjm interconnection in an attempt to tease out the remaining reasons why the ancillary service markets are still so different this is important as there are many innovations that are not rooted in regional differences but reflect genuine technical advances and economic efficiency gains and can be replicated across other isos to produce more efficient designs greater reliability and lower costs

wind power integration and power system flexibility an empirical analysis of extreme events in germany under the new negative price regime abstract in this article the flexibility of the german power market with respect to the integration of an increasing share of electricity from renewable energy sources was analysed flexibility limiting system components which cause negative prices are explained and illustrated for the german market the decision of the european energy exchange in leipzig to allow negative price bids is then explained the empirical data illustrate the flexibility of conventional generating capacities in germany from october 2008 to december 2009 of the 86 h of negative spot prices 19 h were significantly negative with prices of at least 100 mwh these extreme hours were analysed in greater detail by the examination of different system components thereby load wind power infeed and conventional generation by fuel type were observed as well as the market for negative tertiary reserve as indicators for market tightness although the market situations were found to be severe under the current conditions it could have been much worse in order to enable the market to clear at all times policy recommendations are provided and long run implications of an increasing res e share on the conventional generation capacity are discussed the article concludes with an outlook on additional power system flexibility options

measuring global gasoline and diesel price and income elasticities abstract price and income elasticities of transport fuel demand have numerous applications they help forecast increases in fuel consumption as countries get richer they help develop appropriate tax policies to curtail consumption help determine how the transport fuel mix might evolve and show the price response to a fuel disruption given their usefulness it is understandable why hundreds of studies have focused on measuring such elasticities for gasoline and diesel fuel consumption in this paper i focus my attention on price and income elasticities in the existing studies to see what can be learned from them i summarize the elasticities from these historical studies i use statistical analysis to investigate whether income and price elasticities seem to be constant across countries with different incomes and prices although income and price elasticities for gasoline and diesel fuel are not found to be the same at high and low incomes and at high and low prices patterns emerge that allow me to develop suggested price and income elasticities for gasoline and diesel demand for over one hundred countries i adjust these elasticities for recent fuel mix policies and suggest an agenda of future research topics

profitability transactional alignment and organizational mortality in the u s trucking industry the winds of creative destruction rarely blow more fiercely than in a newly deregulated environment managers simultaneously face a novel focus on operating efficiency and an onslaught of new competitors what must managers do to enable their firms to survive in such an environment what factors bear on firms survival this paper presents an analysis of mortality of large motor carriers in the u s interstate for hire trucking industry after deregulation it examines this phenomenon through a multidisciplinary lens that encompasses organizational ecology neoclassical economics and transaction cost economics the paper posits that carrier mortality is a function of both firm level and industry level attributes which are drawn from both ecological and economic theories while each of these theories separately informs motor carrier mortality the inclusion of predictions derived from both disciplines in one model significantly increases explanatory power over either theory evaluated alone the empirical analysis is among the first to show increased mortality when firms do not adhere to operating policies consistent with transaction cost minimization principles in sum managers are well advised to adopt a multidisciplinary approach to strategy to ensure their firms survival 1997 by john wiley sons ltd

what do we learn about consumer demand patterns from micro data the aim of this paper is to assess the importance of using micro level data in the econometric analysis of consumer demand to do this we utilize a time series of repeated cross sections covering some 4 000 households in each of 15 years employing a number of different aggregation procedures we conclude that aggregate data alone are unlikely to produce reliable estimates of structural price and income coefficients however once certain aggregation factors as well as trend and seasonal components are included an aggregate model is not necessarily outperformed across all demand equations in terms of forecasting ability jel d12 c52 c31 the purpose of this paper is to develop a complete consumer demand system based on a time series of individual household data and to use it to measure the biases introduced into the study of consumer de mand behavior when aggregate data are used in place of the appropriate microeco nomic data we assess the suitability of ag gregate data through the impact on income and price elasticities and by evaluating the ability of both micro and aggregate based models to forecast aggregate consumer de mand the biases introduced by the use of aggregate data depend upon the way that household characteristics interact with in come and price effects and on departures of demand systems from linearity we explore the structure of microeconomic demand sys tems and the role of household characteris tics in the behavior of consumer demand both for the light this may shed on the pattern of future demands and for the im plications this behavior has for issues of aggregation consumer demand patterns typically found in micro data sets vary considerably across households with different household characteristics and with different levels of income we model this variability by making intercept and slope parameters in the budget share equations of our demand sys tem depend on household characteristics and by allowing for nonlinear total log expenditure terms in fact in theory consistent demand systems it is total ex penditure rather than disposable income that is allocated across goods we find that this general framework leads to a well specified data coherent demand system which is a quadratic extension of the popu lar almost ideal model of angus s deaton and john muellbauer 1980 the micro level estimates are shown to be sensitive to the treatment of endogeneity of total expen diture and to the specification of interaction terms with household characteristics in ad dition this specification is also shown to possess many attractive features for the evaluation of aggregate models

alternative transportation fuel standards welfare effects and climate benefits this paper develops an integrated model of the fuel and agricultural sectors to analyze the welfare and greenhouse gas emission ghg effects of the existing renewable fuel standard rfs a low carbon fuel standard lcfs and a carbon price policy the conceptual framework shows that these policies differ in the incentives they create for the consumption and mix of different types of biofuels and in their effects on food and fuel prices and ghg emissions we also simulate the welfare and ghg effects of these three policies which are normalized to achieve the same level of us ghg emissions by promoting greater production of food crop based biofuels the rfs is found to lead to a larger reduction in fossil fuel use but also a larger increase in food prices and a smaller reduction in global ghg emissions compared to the lcfs and carbon tax all three policies increase us social welfare compared to a no biofuel baseline scenario due to improved terms of trade even when environmental benefits are excluded global social welfare increases with a carbon tax but decreases with the rfs and lcfs due to the efficiency costs imposed by these policies even after including the benefits of mitigating ghg emissions

world crude oil and natural gas a demand and supply model abstract this paper examines world markets for crude oil and natural gas over the period 1918 1999 it analyzes the time series properties of output and prices and estimates demand and supply elasticities during 1918 1973 and 1973 1999 oil and gas prices were stable during the first period they became volatile afterwards reflecting deep changes in the market structure following the oil shock in 1973 demand price elasticities were too low however demand income elasticities were high supply price elasticities were also too low the elasticity estimates help to explain the market power of the oil producers and price volatility in response to shocks and corroborate elasticity estimates in energy studies

persistence of integration in the face of specialization how firms navigated the winds of disintegration and shaped the architecture of the semiconductor industry although the stylized model of industry evolution suggests that firms transform from vertical integration to specialization over time many industries still exhibit a continued persistence of integrated firms in exploring this puzzle i draw on detailed firm level data from the semiconductor industry to analyze how integrated incumbents beyond shifting to the specialized mode reconfigured in the face of industry s vertical disintegration so as to coexist with the specialized firms i propose and find that the incumbents who persist with vertical integration increase their emphasis on systemic innovations and transact with specialized firms in both upstream and intermediate markets the value creating opportunities associated with integrated incumbents leveraging a their relative superiority in developing systemic innovations and b markets to pursue a broader menu of transactional choices may offset their costs of staying integrated these firm level factors also determine the pattern of industry s vertical disintegration and the extent of coexistence between integrated and specialized firms

optimal response of a thermal unit to an electricity spot market this paper addresses the optimal response of a thermal unit to an electricity spot market the objective is to maximize the unit profit from selling both energy and spinning reserve in the spot market the paper proposes a 0 1 mixed integer linear programming approach that allows a rigorous modeling of i nonconvex and nondifferentiable operating costs ii exponential start up costs iii available spinning reserve taking into account ramp rate restrictions and iv minimum up and down time constraints this approach overcomes the modeling limitations of dynamic programming approaches and is computationally efficient results from realistic case studies are reported