multiple environmental policies and pollution haven hypothesis evidence from china s polluting industries abstract theoretical studies of pollution haven hypothesis predict that differentiated environmental regulation policies will result in inter country relocation of polluting industries this paper investigates pollution haven hypothesis at domestic level in china using panel data of 30 provincial level regions for the period 2004 to 2013 this paper empirically examines to what extent multiple environmental policies affect intra country relocation of polluting industries in china it is found that the implementation of both economic policy instrument like pollution discharge fee and public participation like letter complaints on environmental problems encourages industrial relocation whereas the implementation of environmental legal policy instrument like laws regulations and rules prevents polluting industries from relocating to other regions it is also found that the relocation effect of environmental policies varies with industrial characteristics compared with water pollution intensive industry air pollution intensive industry dominated by stated owned capitals are insensitive to legal policy instruments these findings suggest that the validity of pollution haven hypothesis is jointly associated with the type of environmental policy as well as industrial characteristics

institutional determinants of power sector reform in pakistan the electricity supply sector in pakistan has performed poorly in recent years reforms were introduced in the mid 1990s to improve the sector but progressed slowly with no significant impacts on pre reform performance this study uses new institutional economics as a theoretical basis to elucidate reasons for the failure of power sector reforms in pakistan to make improvements interviews with 23 experts using q methodology generated 215 statements that were used as a q concourse of these 51 statements were selected for the q sample and ranked by 34 respondents depending on their importance analysis revealed four important discourses on the determinants of power sector reform failure in pakistan these included weak governance structure country and sectoral endowments inefficient regulator and unspecified political institutions or unfriendly political contexts the study recommends establishment of institutions that support a market based power supply sector and improvements to the contractual arrangements between stakeholders to reduce opportunistic behaviour

energy policy aid and the development of renewable energy resources in small island developing states abstract small island developing states sids have established ambitious renewable energy targets the promotion of renewable energy has been motivated by several factors a desire to lessen dependence on fossil fuels to attract development assistance in the energy sector and to strengthen the position of sids in climate change negotiations here we explore the interplay between the role of aid and energy policy in the development of renewable energy resources in sids we find that the importance of development assistance has implications for the sustainability of renewable energy development given that funding is not always accompanied by necessary energy policy reforms we also identify energy efficiency and access to modern energy services as having received insufficient attention in the establishment and structure of renewable energy targets in sids and argue that this is problematic due to the strong economic case for such investments

the exponential convergence of bayesian learning in normal form games abstract this paper continues the study of bayesian learning processes for general finite player finite strategy normal form games bayesian learning was introduced in an earlier paper by the present author as an iterative mechanism by which players can learn nash equilibria the main result of the present paper is that if prior beliefs are sufficiently uniform and expectations converge to a regular nash equilibrium then the rate of convergence is exponential

investment security of supply and sustainability in the aftermath of three decades of power sector reform the last three decades have witnessed many electricity industry reform processes in more than half of the countries in the world the reforms have aimed inter alia at encouraging private investments in electricity infrastructure enhancing security of electricity supply and making power industry operate in line with the requirements of the sustainable development using an original panel dataset from 55 developed and developing countries covering the period from 1975 to 2010 this study aims at finding out to what extent these objectives have been materialized so far econometric models are used to identify the effects of electricity market liberalization on these variables the research findings suggest that the progress toward the electricity market reform is associated with a decline in private investments in the electricity industries of developing countries higher levels of self sufficiency in electricity supply and lower co2 emissions from electricity generation

bayesian learning in repeated games abstract this paper studies repeated games with a finite number of players a finite number of actions discounted payoffs and perfect recall the players initial expectations are given by a common prior distribution over player types a type being a discount rate and payoff matrix the main result is that bayesian nash equilibria have the property that with probability one players expectations asymptotically approach the set of nash equilibria for the repeated game specified by the true types journal of economic literature classification number c72

the innovation impact of the eu emission trading system findings of company case studies in the german power sector abstract this paper provides a detailed analysis of how the european emission trading system eu ets as the core climate policy instrument of the european union has impacted innovation towards this end we investigate the impact of the eu ets on research development and demonstration rd d adoption and organizational change in doing so we pay particular attention to the relative influences of context factors policy mix market factors and public acceptance and firm characteristics value chain position technology portfolio size and vision empirically our qualitative analysis is based on multiple case studies with 19 power generators technology providers and project developers in the german power sector which were conducted in 2008 09 we find that the innovation impact of the eu ets has remained limited so far because of the scheme s initial lack of stringency and predictability and the relatively greater importance of context factors additionally the impact varies significantly across technologies firms and innovation dimensions and is most pronounced for rd d on carbon capture technologies and organizational changes our analysis suggests that the eu ets on its own may not provide sufficient incentives for fundamental changes in corporate innovation activities at a level which ensures political long term targets can be achieved

trade openness and the environmental kuznets curve evidence from chinese cities this paper examines the impact of economic growth and trade openness on environment in 261 chinese cities over the period of 2004 2013 using recently developed continuously updated fully modified method which allows for both cross sectional dependence and endogeneity two types of pollutants industrial waste water and sulphur dioxide are investigated and three measures of openness are employed in the regression from the results we find that the environmental kuznets curve hypothesis holds not only for the whole china but also in different regions it is estimated that wastewater pollution increases with economic development until per capita gdp reaching the turning point of 42 991 48 828 yuan in constant 2002 price which varies depending on the specific measure of trade openness the turning point for sulphur dioxide is found to occur at a much lower income level around 9 588 10 663 yuan per capita gdp furthermore export is mostly found to be positively related with pollution and the impact of import is likely to be negative for both the whole china and across regions if the significance is identified in the estimation results

the philippine electricity sector reform and the urban question how metro manila s utility is tackling urban poverty in the early 2000s the philippine government reformed its electricity sector following neoliberal principles unbundling of the power industry privatisation of assets and commodification of electricity this paper shows that the reform was primarily driven by the need to secure electricity supply and cut down tariffs these national objectives ousted other issues and notably those that find their expression at the urban level among which the question of access to electricity in metro manila s urban poor communities the central state withdrew its attention from the issue of electrification and local actors had to react as they were confronted to social tensions and practices of pilferage as a consequence city governments and local administrations are getting involved in this issue which opens the way to participation of civil society this paper shows how the rolling back of the central state led to new partnerships and arrangements between the distribution utility local governments and community organisations this movement points to an urbanisation of energy issues which could bring positive results for end users provided that it is accompanied by a clearer regulatory framework

cooperation for pennies a note one equilibria abstract it is shown that in finitely repeated smooth games e equilibria are capable of supporting full cooperation up to very near the end of the horizon with very small amounts of irrationality e furthermore behavior even near the end of the horizon is highly insensitive to the amount of irrationality assumed journal of economic literature classification numbers c73 l13

power sector reform in india current issues and prospects power sector reforms in india were initiated at a juncture when the sector was plagued with commercial losses and burgeoning subsidy burden investment in the sector was not able to keep pace with growing demand for electricity this paper takes stock of pre reform situation in indian power sector and identifies key concerns that led to initiation of the process of reform the paper discusses major policy and regulatory changes undertaken since the early 1990s the paper also illustrates changes in the market structure as we move along the reform process we also discuss some of the major provisions of the recently enacted electricity act 2003 that aims to replace the prevailing acts which govern the functioning of the power sector in the country in this context we discuss two issues arising out of it namely open access and multi year tariff that we think would have a significant bearing on the performance of the sector in the near future the paper also evaluates the reform process in the light of some of the regulatory changes undertaken finally the paper briefly discusses the issues involved in introduction of competition in the power sector primarily through development of a market for bulk power

competition in regional environmental policies when plant locations are endogenous abstract a two region model is presented in which an imperfectly competitive firm produces a good with increasing returns at the plant level production of the good causes local pollution the firm decides whether to maintain plants in both regions serve both regions from a single plant or shut down if the disutility of pollution is high enough the two regions will compete by increasing their environmental taxes standards until the polluting firm is driven from the market alternatively if the disutility from pollution is not as great the regions will usually compete by undercutting each other s pollution tax rates

how to achieve full electrification lessons from latin america electricity coverage in latin america has increased substantially in recent decades rising from 50 of the population in 1970 to more than 95 in 2015 growth however slowed in the 1990s as many countries experienced difficulties in extending their networks further in particular to serve those living in isolated and rural areas in spite of this the process of electrification was not interrupted and at the beginning of the 2010s decade most countries in the region were able to provide access to electricity to almost all of their populations in this paper we examine the main strategies used in latin america to increase coverage and argue that only a combination of policy efforts has made it possible to achieve the current situation we also examine the remaining obstacles at policy and institutional levels to achieving full coverage

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

reputation and imperfect information abstract a common observation in the informal literature of economics and elsewhere is that is multistage games players may seek early in the game to acquire a reputation for being tough or benevolent or something else but this phenomenon is not observed in some formal game theoretic analyses of finite games such as selten s finitely repeated chain store game or in the finitely repeated prisoners dilemma we reexamine selten s model adding to it a small amount of imperfect or incomplete information about players payoffs and we find that this addition is sufficient to give rise to the reputation effect that one intuitively expects

reputation versus social learning a folk theorem of game theory illustrates that strategic use of reputation can drastically alter the equilibrium play of an isolated group of n players engaged in a finitely repeated game we show that this folk theorem may fail in social settings where many groups of n players play the game sequentially the ability to strategically use reputation dies out over time due to players opportunity to observe the play of earlier groups this phenomenon is demonstrated in a model of bayesian recurring games by using old and new techniques from the rational learning literature combined with a notion of purification journal of economic literature classification numbers c72 c73 d83

lost in transition comparing strategies of electricity companies in delhi this paper examines the notion of energy transition when implemented by private utilities in 2000 the delhi government privatized electricity distribution to three private distribution companies most research was concerned with the impact of privatization on energy reliability tariff settings and regulation issues this paper looks at two under researched themes the expansion of services to poorer neighborhoods and the rollout of clean energy policies this focus allows to unpack the materiality of socio technical systems to analyze how energy infrastructures are being technically deployed on the ground and to identify which social approach is used to detail the specific practices of each company provides a more nuanced and accurate understanding of the reform in depth analysis of the three private utilities show that they interpret the reform mandate differently they use a varied range of technical tools they respond differently to social concerns in poorer neighborhoods and they have distinctive internal management choices and corporate cultures all these four factors can strengthen or undermine the transition towards increased access and clean energy

broken dreams unmet expectations of investors in the philippine electricity restructuring and privatization abstract over the last three decades privatization and restructuring of electricity sectors has been a hot topic the expectation was that prices would fall due to increased competition and that generators would become more innovative and efficient however the enthusiasm for deregulation wavered after events such as the debacle in california the fall of enron and the setbacks of ontario in the philippines comprehensive legislation was passed in 2001 but the implementation has been rather slow and controversial this paper looked at the allegation of politicizing power rates and found a logical alternative to the perceived conspiracy angle based on market data it is highly probable that depressed market rates was a result of coping mechanisms of new players trying to adjust to the restructured industry

sustainability assessment of electricity market models in selected developed world countries abstract the paper focuses on the impact of electricity market opening on sustainability of electricity market models the paper aims to identify what electricity market organization models are the best ones based on the established sustainability criteria the sustainability criteria include the main sustainability aspects of power sector economic social and environmental the methodology has been designed to evaluate organisational models of electricity market which allows performing an extensive evaluation encompassing all aspects of sustainable development the evaluation methodology which has been designed for the evaluation of energy market organisation model provides the basis for the identification of indicators that have the most significant impact on sustainability also it lays down the premise for the establishment of critical values and possible changes and the analysis of reasons for the changes in sustainability the paper applies developed model for sustainability assessment of electricity market models in several world countries having different electricity market organisation structures the selection of 12 developed world countries 11 of them are oecd countries from various continents was made based on availability of fully liberalized electricity markets in these countries the proposed assessment allows to review and compare electricity market models in terms of achieving main targets of sustainable power sector development

cross hauling of polluting factors abstract this paper analyzes the investment environment overlap using a two stage model of two jurisdictions capital exports are modeled as choice variables for capital owners who weigh income considerations against the effects of capital exports on the quality of their local environments and on environmental policy this framework reveals that capital owners have an incentive to cross haul polluting factors across jurisdictions when direct controls are used to regulate emissions and that this cross hauling induces policymakers to ratchet up environmental policies in both locations the importance of instrument type and commitment on environmental policy is also analyzed

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

the boundaries of multinational enterprises and the theory of international trade this paper begins with a review of empirical evidence on multinational firms conceptual underpinnings of a theory are developed relying in particular on the notion of knowledge capital as a mobile joint input into geographically separated production facilities this idea is embedded in a simple two country general equilibrium model that supports multinational production in equilibrium under conditions consistent with the empirical evidence the final section examines internalization and shows why certain properties of knowledge capital also imply a preference for transferring technologies internally within the firm rather than through arm s length markets

post neoliberal electricity market re reforms in argentina diverging from market prescriptions this paper focuses upon the policy and institutional change that has taken place within the argentine electricity market since the country s economic and social crisis of 2001 2 as one of the first less developed countries ldcs to liberalise and privatise its electricity industry argentina has since moved away from the orthodox market model after consumer prices were frozen by the government in early 2002 when the national currency was devalued by 70 although its reforms were widely praised during the 1990s the electricity market has undergone a number of interventions ostensibly to keep consumer prices low and to avert the much discussed energy crisis caused by a dearth of new investment combined with rising demand levels this paper explores how the economic crisis and its consequences have both enabled and legitimised these policy and institutional amendments while drawing upon the specifics of the post neoliberal market re reforms to consider the extent to which the government appears to be moving away from market based prescriptions in addition this paper contributes to sector specific understandings of how despite these changes neoliberal ideas and assumptions continue to dominate argentine public policy well beyond the postcrisis era

r d investment of electricity generating firms following industry restructuring abstract since electricity market restructuring questions over adequate levels of r d investments persisted using an unbalanced panel data of 70 electricity generating firms across 15 organisations of economic co operation and development countries from 1990 to 2008 this paper empirically examines the impacts of entry liberalization allowing third party access establishing a wholesale market and deregulating a retail market vertical unbundling privatization and firm size on r d investments entry liberalization is associated with a decline in r d investment establishing a wholesale market exhibits the greatest negative effects on r d investment regulated tpa and retail market deregulation also decrease r d the effect of privatization is not independently salient but interacts with a wholesale pool to lower r d investments large firms spend more on r d investment than small firms results indicate that the restructuring of the electricity industry reduces r d investment which may be detrimental to the reliability and the efficiency of the electricity system as well as to the creation and maintenance of the innovation capabilities necessary to address demand and environmental concerns

getting reforms done in inhospitable institutional environments untying a gordian knot in india s power distribution sector when grand institutional reforms based on idealized models are stalled by the poor institutional environments and difficult politics which often surround large infrastructure systems in developing countries partial reforms whose design and implementation take into account the different interests of the key stakeholders can provide valuable and immediate benefits while moving these systems from low towards higher level equilibria strategically negotiated experimentally partial and purposefully hybrid these reforms are based on careful stakeholder analysis and strategic coalition building that avoid rigid positions based on idealized models our findings are based on a study of power sector reforms in india where we performed a micro level and in depth analysis of a partial and innovative experiment which has allowed private sector participation in electricity distribution within a hostile institutional environment

private sector development policies practices and problems private sector development psd has become a central concern of most donors development cooperation efforts during the last decade this paper is a critical review of policies in the area donors work with concepts of psd which are highly abstract treat developing countries private sectors as tabula rasa and focus mainly on macro level preconditions in practice however concrete psd policies are mostly micro level ones the paper argues that they are shaped mostly by the nature and interests of private sectors in donor country themselves incorporate a high proportion of tied aid and fail basic tests of coherence

power sector reform in small island developing states what role for renewable energy technologies abstract due to various pressures and desires more and more developing countries embark on power sector reform programmes yet there are a wide range of reform options and at present insufficient evidence is available as to which path will deliver best the desired objectives presently most small island developing states sids are dependent on high cost fossil fuel imports for power generation in spite of evidence that harnessing abundant domestic renewable sources of energy can deliver environmental social and economic benefits however depending on the type of power sector reform the transition towards renewable energy technologies rets can be either undermined or facilitated the specific focus on sids is justified because they have inherent characteristics that limit the degree to which the power sector can be transformed in comparison to larger continental developing countries with specific reference to sids this manuscript reviews the drivers and desires for power sector reform as well as presenting the available reform options and their implications on the up take of rets in addition to elaborating aspects of market governance other barriers to the consideration of rets such as financial bias in investment human capacity and environmental policy are discussed in view of this discussion which is based on evidence from recent reform programmes and theoretical academic literature recommendations are formulated that discourage full privatisation of the power sector as well as proposing less dogmatic lending conditions by international assistance bodies

footloose and pollution free in numerous studies economists have found little empirical evidence that environmental regulations affect trade flows in this paper we propose and test several common explanations for why the effect of environmental regulations on trade may be difficult to detect we demonstrate that whereas most trade occurs among industrialized economies environmental regulations have stronger effects on trade between industrialized and developing economies we find that for most industries pollution abatement costs are a small component of total costs and are unrelated to trade flows in addition we show that those industries with the largest pollution abatement costs also happen to be the least geographically mobile or footloose after accounting for these distinctions we measure a significant effect of pollution abatement costs on imports from developing countries and in pollution intensive footloose industries

do people play nash equilibrium lessons from evolutionary game theory evolutionary game theory provides an answer to two of the central questions in economic modeling when is it reasonable to assume that people are rational and when is it reasonable to assume that behavior is part of a nash equilibrium and if it is reasonable which equilibrium the traditional answers are not compelling and much of evolutionary modeling is motivated by the need for a better answer evolutionary game theory suggests that in a range of settings agents do eventually play a nash equilibrium moreover evolutionary modeling has shed light on the relative plausibility of different nash equilibria

power sector reform in developing countries mismatched agendas power sector reform is rapidly spreading across all corners of the developing world at an alarmingly rapid pace while the rationales for reform seem to have gained acceptance among the stakeholders the reform model and process are contested this paper examines the impacts of reform using the promised outcomes as a basis for analysis the ability of reform to meet the developmental challenges facing the reformers is explored it concludes that reform has had some achievements if conventional performance indicators are used but also questions the validity of some of these indicators reform has however not fulfilled many of its goals and the prevailing recipes are likely to leave developing countries socially and economically worse off than in the pre reform period progressive government intervention is needed to shift reform process towards a more responsible development path

learning from others a welfare analysis abstract this paper considers a smooth and noisy version of the statistical prediction model studied in the herding informational cascades literature and compares market and optimal learning the latter is characterized by defining a decentralized welfare benchmark as the solution to an infinite horizon team problem market behavior involves herding in the sense that agents put too little weight on their private information for any given precision of public information and yields underinvestment in the production of public information however both market and optimal learning involve slow learning examples of the model include learning by doing reaching consensus and consumer learning about quality journal of economic literature classification numbers d82 d83

electricity demand supply analysis current status and future prospects for maharashtra india abstract the growth potential of any state is linked with infrastructure and electricity infrastructure is the most important parameter for economic growth maharashtra a prominent state in india consumes 12 per cent of india s electricity maharashtra s power sector is facing the electricity deficit and shortage since early 2005 on the other hand industrial and service sectors are rising in the state the present paper discusses electricity situational analysis of the state electricity demand analysis has been presented and comparison of state electricity demand vis a vis mumbai s demand state capital has been carried out for two years variation for monthly average demand for two years and load shedding have also been analyzed power supply situation analysis and analysis of major power suppliers have been carried out the state load distribution center data is used to depict the load variation for a typical day interventions needed to sustainably meet the growing demands are also discussed

the impact of power market reforms on electricity price cost margins and cross subsidy levels a cross country panel data analysis abstract one of the main expectations from power market reform has been a reduction in both price cost margins and cross subsidy levels between industrial and residential consumers this paper focuses on this issue by looking at the impact of the electricity industry reforms on residential and industrial electricity price cost margins and their effect on cross subsidy levels between consumer groups using panel data for 63 developed and developing countries covering the period 1982 2009 empirical models are developed and analyzed the research findings suggest that there is no uniform pattern for the impact of reform process as a whole on price cost margins and cross subsidy levels each individual reform step has different impact on price cost margins and cross subsidy levels for each consumer and country group our findings imply that reform steps have different impacts in different countries which supports the idea reform prescription for a specific country cannot easily and successfully be transferred to another one so transferring the formal and economic structure of a successful power market in a developed country to developing countries is not a sufficient condition for good economic performance of the electricity industries in developing countries furthermore the study suggests that power consumption income level and country specific features constitute other important determinants of electricity price cost margins and cross subsidy levels

privatization technical efficiency and welfare consequences the case of the cote d ivoire electricity company cie abstract in 1990 cote d ivoire privatized the management of its electric power company lease contracting in this paper we are interested in identifying the economic effect of this institutional change by estimating a stochastic production frontier we have found that productive efficiency improved after privatization thanks to organizational innovations total factor productivity gains have been closely associated with a cost reduction strategy the way these gains have been distributed in a monopoly context suggests that consumers have been the main beneficiaries through a significant decrease of the relative price of electricity

trade and transboundary pollution spatial separation reconsidered abstract copeland and taylor 1999 j int econ 47 137 168 show that trade allows the spatial separation of two incompatible industries concentrating the polluting industry in one country eliminates its degenerative effects in the other this paper extends the analysis by allowing for transboundary pollution thus specialization has indirect repercussions on the level of pollution in the other country we show i how cross national differences in exposure to pollution emissions can generate comparative advantage and ii under what condition the resulting trading pattern combined with transboundary pollution can increase pollution exposure with negative effects on productivity and welfare in both countries

greenhouse gas emission controls and firm locations in north south trade this paper studies greenhouse gas emission ghg controls in the presence of international carbon leakage through international firm relocation in a new economic geography model with two countries north and south only north sets a target for ghg emissions we compare the consequences of emission quotas and emission taxes under trade liberalization on location of two manufacturing sectors with different emission intensities and degrees of carbon leakage with low trade costs further trade liberalization increases global emissions by facilitating carbon leakage regulation by quotas leads to spatial sorting resulting in less carbon leakage and less global emissions than regulation by taxes

reforming israel s electricity sector abstract this paper analyzes the regulatory structure of the electricity sector in israel which is currently dominated by the government owned integrated utility israel electric corporation iec the current structure of a price cap with a mandatory rate reduction of 2 per year and a target return on equity roe of 6 5 is not sustainable because of iec s deteriorating financial health caused by the substantial investments it made to meet the 7 2 per year electricity demand growth in the past decade which has led to an exceptionally low realized roe of 3 4 for that period the investment trend will continue thanks to the 4 5 per year gdp growth projected for the next 10 20 years part of our proposed remedy is performance based regulation pbr implemented via a a price cap formula that will restore iec s financial health and offer iec downward pricing flexibility b changes in how iec compensates its workers and c a sliding scale plan that provides incentives for iec to become more efficient and to share risk with its customers we augment the pbr proposal by recommending changes in iec s tariffs and resource procurement procedures that aim to promote the development of a competitive power industry in the next 10 15 years

understanding the political economy and key drivers of energy access in addressing national energy access priorities and policies abstract globally 1 5 billion people lack access to electricity and nearly 3 billion lack access to modern cooking energy options of the world s energy poor 95 are in asia and sub saharan africa within asia almost 80 of electricity deprived and 86 of biomass dependent populations are in the big 5 countries bangladesh china india indonesia and pakistan in this paper we discuss the broad contours of the political economy of energy access in these countries the political economy is assessed through an examination of three sustainability objectives accessibility of physical infrastructure energy service delivery and conformance to social goals the key areas of concern include emphasis on supply driven grid electricity vested power dynamics favouring affluent and urban areas unreliability of energy service provision and misdirected and misappropriated subsidies the above mentioned issues are responsible for limiting accelerated achievement of universal energy access in the big 5 countries and need to be addressed through innovative approaches the paper emphasizes the need for firm commitments policy convergence and the implementation of pro poor equitable energy policies through a broad based energy framework of bench marked technology neutral energy provisioning that ensures reliability and equity it highlights the need for reorienting of the subsidy regime and incorporating energy service delivery indicators in monitoring and reporting mechanisms

pollution havens and industrial agglomeration abstract this paper examines the pollution haven hypothesis using a spatial economy model of two countries and two sectors the manufacturing sector generates cross border pollution which reduces cross sectoral productivity of agricultural goods and lowers local income we derive a demand reducing effect that discourages firms to move to the country with laxer environmental regulations in the absence of any comparative advantage our analysis also demonstrates that manufacturing agglomeration forces can alleviate the pollution haven effect a pollution haven may not arise if environmental regulation is slightly more stringent in the larger country

the role of distribution network operators in promoting cost effective distributed generation lessons from the united states of america for europe abstract this paper explores the different competitive mechanisms applied by electric utilities from the us in promoting cost effective distributed energy resources der with a focus on distributed generation dg and the challenges that electric utilities are facing due to the increase in dg connections cases studies from california oregon colorado and new york have been selected the case studies refer to two kinds of competitive mechanisms request for proposals rfp and auctions renewable auction mechanism a similar behaviour is observed across electric utilities in the way in which competitive auction mechanisms are being managed however the more sophisticated auction designs are observed in the rfps the study proposes a set of auction design elements with a focus on the uk context and examines the role of energy regulators in the design of well structured auction mechanisms we think that the experience cited in the four case studies can be replicated by distribution system operators dsos from europe however unbundling rules established in the european commission third energy package need to be taken into consideration

economists models of learning abstract economic theorists have intensively studied learning in games and decisions over the last decade this essay puts some of the work in perspective and offers opinions about what still needs to be learned journal of economic literature classification numbers c73 d83

end of pipe or cleaner production how to go green in presence of income inequality and pro environmental behavior in this paper we consider a vertically differentiated duopoly model in which a green producer competes with a brown rival in a market in which consumers are environmentally concerned in particular consumers are assumed to value not only the intrinsic quality of a certain product but also its environmental impact this environmental valuation has a positional content consumers attach a positive attribute to the green product while penalizing the brown one in this context we consider the choice of the green firm between cleaner and end of pipe abatement efforts we find that the interplay between the intensity of market competition consumers income disparity and environmental concern can play a crucial role in directing the green producer towards one or the other technological choice more precisely the adoption of cleaner production technologies can be discouraged by low average income and by tough competition while it can be spurred by the moral social incentive towards pro environmental behavior

risk management and the stated investment costs by independent power producers abstract evidence presented in this article suggests that in less developed countries the independent power producers ipps have an incentive to overstate the investment cost as an instrument to mitigate the country risk in greenfield electricity generation projects this technique is an effective risk mitigation strategy under the conventional financing and contractual arrangements in such markets it however promotes the use of less efficient power plants the distortion in the choice of technology results in economic losses over the life of the plants the findings of this research have important policy implications that can assist regulatory bodies governments and international financing agencies to adopt a more informed approach to the integration of private investment into the electricity generation capacity of developing countries

hope springs eternal learning and the stability of cooperation in short horizon repeated games abstract this paper considers learning rates in finitely repeated prisoners dilemmas if players think their opponents might be relatively cooperative e g tit for tat or grim types they will cooperate in finitely repeated prisoners dilemmas see kreps et al j econom theory 27 1982 245 however if there are actually no cooperative types players will eventually learn this and cooperation will break down this paper shows that this learning is extremely slow so it will take an extremely long time for cooperation to break down thus suppose the world is either good or bad the probability of a grim type is 0 if the world is good and zero if the world is bad successive generations pair up to play finitely repeated prisoners dilemmas players observe play in previous generations and use bayes rule to update their prior that the world is good we show that if the world is really bad then falls o 2 log 1 per generation on average thus if is small there is less cooperation if the world is good but cooperation may become more stable for a representative 19 period repeated prisoners dilemma beliefs fall one percentage point on average after a thousand generations to derive these learning rates we must refine existing results on the sensitivity of repeated games to kreps et al 1982 type perturbations specifically we show cooperation is possible in perturbed prisoners dilemmas repeated o log 1 times this improves significantly on the o 1 results in previous work the paper thus provides two new reasons why cooperation tends to be stable even in short horizon repeated games

behavioral aspects of arbitrageurs in timing games of bubbles and crashes abstract this paper demonstrates the theoretical foundation that underlies the willingness of rational arbitrageurs to delay and reinforce the speculative attack the key assumptions are that there is a small probability that arbitrageurs are behavioral and never time the market of their own accord and it is uncertain whether arbitrageurs are behavioral or rational we model a stock market as a timing game in which arbitrageurs compete to react quickest we show that rational arbitrageurs are willing to ride the bubble for a long period we also characterize symmetric nash equilibria and show the sufficient condition for uniqueness

impacts on investments and transmission distribution loss through power sector reforms abstract this study analyses original panel data from 86 countries between 1985 and 2006 econometric methods were used to identify the effects of different policy devices of power sector reforms on performance indicators installed capacity per capita transmission and distribution loss in the countries analyzed the research findings suggest that reform variables such as the entry of independent power producers ipps unbundling of generation and transmission establishment of regulatory agencies and the introduction of a wholesale spot market are the driving forces of increasing generation capacity as well as reducing transmission and distribution loss in the respective regions in this study we can assume that firstly different electric industry s reform policies measures have different impacts on geographically and economically diverse countries secondly a country s state of economic development has a different impact on policy effects of reforms thirdly coexistent with independent regulatory agencies reform policy becomes more powerful in realizing sector performances

access to electricity in small island developing states of the pacific issues and challenges abstract energy poverty is widespread in small island developing states sids of the pacific it is estimated that 70 percent of pacific islander households do not have access to electricity which is equivalent to access rates in sub saharan africa and slightly below the average for low income countries pacific sids face unique challenges in expanding access to electricity given that their populations are spread across tens of thousands of islands governments and development partners in pacific sids continue to prioritise development of electricity grids as is evident in ongoing subsidisation of grid based power consumption and the establishment of ambitious grid based renewable energy targets this paper argues that traditional approaches to rural electrification which prioritise grid extension are not suited to the pacific islands region increased funding should be directed by both governments and development partners towards rural electrification especially in off grid areas where isolated systems are more appropriate institutional reform is also important regulatory reform is needed for power utilities to extend electricity grids into rural areas institutional arrangements that facilitate the sustainable operation and maintenance of off grid systems also need to be established past donor and government funded off grid rural electrification projects have rarely been sustainable alternative approaches involving payment of output based subsidies to energy service companies are worth exploring although will only succeed where sound regulatory arrangements are in place

trade spatial separation and the environment we develop a simple two sector dynamic model to show how pollution can provide a motive for trade by spatially separating incompatible industries we assume that the production of smokestack manufactures generates pollution which lowers the prod uctivity of an environmentally sensitive sector farming two identical unregulated countries will gain from trade if the share of world income spent on smokestack goods is high in contrast when the share of world income spent on the dirty good is low trade can usher in a negatively reinforcing process of environmental degradation and real income loss for the exporter of smokestack goods 1999 elsevier science b v all rights reserved

evolution and game theory introduced by john von neumann and oskar morgenstern 1944 energized by the addition of john nash s 1950 equilibrium concept and popularized by the strategic revolution of the 1980s noncooperative game theory has become a standard tool in economics in the process attention has increasingly been focused on game theory s conceptual foundations two questions have taken center stage should we expect nash equilibrium play that is should we expect the choice of each player to be a best response to the choices of the other players if so which of the multiple nash equilibria that arise in many games should we expect in the 1980s game theorists addressed these questions with models based on the assumptions that players are perfectly rational and have common knowledge of this rationality in the 1990s however emphasis has shifted away from rationalitybased to evolutionary models one reason for this shift was frustration with the limitations of rationality based models these models readily motivated one of the requirements of nash equilibrium that players choose best responses to their beliefs about others behavior but less readily provided the second requirement that these beliefs be correct simultaneously rationality based criteria for choosing among nash equilibria produced alternative equilibrium refinements strengthenings of the nash equilibrium concept designed to exclude implausible nash equilibria with sufficient abandon as to prompt despair at the thought of ever choosing one as the right concept a second reason for the shift away from rationality based game theory was a change in the underlying view of what games represent it was once typical to interpret a game as a literal description of an idealized interaction in which an assumption of perfect rationality appeared quite

evolution in the finitely repeated prisoner s dilemma abstract this paper examines some aspects of evolutionary dynamic behavior in the finitely repeated prisoner s dilemma the fitness of cooperation found in the best known simulation of this type that by robert axelrod stems from strategy set restrictions the game used for the simulation has a continuum of pure cooperation equilibria and no pure defection equilibrium some new simulations are presented here for the finitely repeated game although cooperation is ultimately exploited and extinguished dynamic paths can pseudo converge in ways that allow partial cooperation to flourish for extended periods of time

current status and analysis of renewable promotional policies in indian restructured power sector a review restructuring has changed the traditional mission and mandates of power utilities in complex ways and had large impacts on environmental social and political conditions for any particular country at the same time new regulatory approaches are being found for reducing environmental impacts in restructured power sectors india has a vast supply of renewable energy resources and it has one of the largest programs in the world for deploying renewable energy based products and systems so this paper attempts to review the various policies and measures undertaken by indian government for promotion of renewable energy the aim of this paper is also to review the current policy mechanisms especially investment or generation based price driven and capacity driven mechanisms ranging from investment incentives for the development of renewable energy projects feed in tariffs production tax incentives tradable green certificates and their effects upon the prospects of encouraging as well as expanding the development of renewable energy in indian restructured power sector this will make renewable more attractive in the indian future electricity market

environmental policy when market structure and plant locations are endogenous abstract a two region two firm model is developed in which firms choose the number and the regional locations of their plants both firms pollute and market structure is endogenous to environmental policy there are increasing returns at the plant level imperfect competition between the home and the foreign firm and transport costs between the two markets at critical levels of environmental policy variables small policy changes cause large discrete jumps in a region s pollution and welfare as a firm closes or opens a plant or shifts production to from a foreign branch plant the implications for optimal environmental policy differ significantly from those suggested by traditional pigouvian marginal analysis

intra industry trade in intermediate products pollution and internationally increasing returns this paper examines the relationship between intra industry trade in intermediate products pollution and increasing returns we develop a two country model in which production occurs in two stages final and intermediate good production intermediate goods are produced under monopolistic competition and final good production exhibits increasing returns with respect to the number of varieties of intermediates pollution occurs in the production of the final good when polluting intermediates are used we analyze the effects of international trade in intermediate products on pollution output and welfare under an endogenous tax scenario and with two types of pollution functions the results show that because of increasing returns international trade either leads to lower total pollution in each country or lower pollution per unit of output in at least one country in addition intra industry trade causes countries to import the environmental quality of their trading partners

electricity use and economic development abstract a study of the relationship between electricity use and economic development in over one hundred countries constituting over 99 of the global economy has been undertaken correlations between electricity consumption capita and gdp capita have been analysed and compared with those between total primary energy supply capita and gdp capita a supporting analysis has correlated the proportion of energy used in the form electricity the e e ratio with gdp capita the general conclusions of this research are that wealthy countries have a stronger correlation between electricity use and wealth creation than do poor countries and that for the global economy as a whole there is a stronger correlation between electricity use and wealth creation than there is between total energy use and wealth the study also shows that in wealthy countries the increase in wealth over time correlates with an increase in the e e ratio the results imply that the energy ratio toe should be replaced by the electricity ratio kwh as a development indicator and more precisely by the e e ratio kwh toe

review of proposals for practical power sector restructuring and reforms in a dynamic electricity supply industry abstract south africa s electricity supply industry esi remains a vertically integrated monopoly despite global trends towards restructuring the monopolistic nature of the esi could hinder the development of distributed power systems as penetration of renewable electricity increases the research aims to rationalise south africa s esi evolution propose practical power sector restructuring in the short to medium term and to determine their potential impact the research methodology included a single case study instrument with embedded sub units of analysis primary research data was gathered using semi structured interviews with industry experts in addition to which secondary data from government documents and archival records were used for triangulation research results conclude that south africa s esi grew due to techno economic industrialisation factors while apartheid era policies influenced the esi in only some specific respects the vertically integrated status quo was sustained in the post transformation period due to government s focus on social imperatives lack of regulatory policy certainty and conflicts in political ideology south africa did not experience the pre conditions that triggered global power sector reforms in the late 20 th century but these pre conditions are now becoming evident privatisation of eskom generation and introduction of wholesale and retail competition are not practical in the short to medium term proving the infeasibility of the standard model of reform locally the introduction of an independent system and market operator ismo using a single buyer model is seen as the most favourable and practical option with the ismo owning transmission infrastructure the research suggests that esi changes will increase system efficiencies economic performance and private sector involvement but will not reduce electricity tariffs the scenarios challenges and proposals identified in this research are also applicable to other countries in africa and other developing regions of the world that have similar social and political backgrounds ensuring sustainable supply of electricity

agglomeration effects in foreign direct investment and the pollution haven hypothesis does environmental regulation impair international competitiveness of pollution intensive industries to the extent that they relocate to countries with less stringent regulation turning those countries into pollution havens we test this hypothesis using panel data on outward foreign direct investment fdi flows of various industries in the german manufacturing sector and account for several econometric issues that have been ignored in previous studies most importantly we demonstrate that externalities associated with fdi agglomeration can bias estimates away from finding a pollution haven effect if omitted from the analysis we include the stock of inward fdi as a proxy for agglomeration and employ a gmm estimator to control for endogenous time varying determinants of fdi flows furthermore we propose a difference estimator based on the least polluting industry to break the possible correlation between environmental regulatory stringency and unobservable attributes of fdi recipients in the cross section when accounting for these issues we find robust evidence of a pollution haven effect for the chemical industry

reform despite politics the political economy of power sector reform in fiji 1996 2013 abstract attempts to reform the electricity sector in developing countries have achieved mixed results despite the implementation of similar reforms in many developed countries and concerted effort by donors to transfer reform models in many cases political obstacles have prevented full and effective implementation of donor promoted reforms this paper examines the political economy of power sector reform in fiji from 1996 to 2013 reform has been pursued with political motives in a context of clientelism policy inconsistency and reversal is explained by the political instability of ethnic based politics in fiji modest success has been achieved in recent years despite these challenges with fiji now considered a model of power sector reform for other small islands developing states sids in the pacific the experience demonstrates that reform is possible within difficult political environments but it is challenging takes time and is not guaranteed the way in which political motives have driven and shaped reform efforts also highlights the need for studies of power sector reform to direct greater attention toward political drivers behind reform

unilateral climate policy and foreign direct investment with firm and country heterogeneity we analyse the effects of unilateral climate policy in a two country two firm model with endogenous plant location and heterogeneity in both country size and firm s characteristics the effectiveness of unilateral climate policy is shown to depend on the joint effect of country and firm heterogeneity and on their impact on equilibrium location choice for being effective and not leading to production relocation in the long run unilateral climate policy should be moderate implemented by a sufficiently larger area and complemented by mechanisms promoting the international transfer of clean technologies the model indicates that the smaller area cannot take the lead in global climate mitigation for a protracted time period finally when the local community is not environmentally concerned the unilateral policy unambiguously makes the society worse off

implications of liberalization policies on government support to r d lessons from electricity markets since the early 1980s electricity industry reforms have been initiated in more than half of the countries in the world among the primary targets of these reform schemes there has been an increase in efficiency of the sector and it is implicitly assumed that government support to energy technology r d will progress in line with the reform process as the former is required to sustain improved efficiency in the middle and long run the paper reviews the relation between reform process in electricity markets and government support to energy r d using panel data from 27 countries covering the period from 1974 to 2008 this study aims at finding out to what extent the expected correlation between reform process and government support to energy r d has in practice been materialized so far the findings suggest that contrary to expectations the progress toward electricity market reform is associated with reduced government support to a variety of energy r d activities which threatens sustainable efficiency improvements in the power industry

the arguments for and against ownership unbundling of energy transmission networks abstract the question this paper addresses is what is the evidence for the superiority of the ownership unbundled transmission models i e uk or nord pool hybrid over other models we assess the theoretical costs and benefits of ownership unbundling and judge these to be generally positive though these may be potentially offset by the actual reorganisation costs of the ownership unbundling process next we assess the empirical evidence this is in two forms econometric evidence from samples of countries and case studies of reforms in particular jurisdictions the econometric evidence is weak due to problems with simultaneity of reform steps and a lack of studies but the case study evidence is compelling we conclude with a discussion of the issues faced by countries considering implementing ownership unbundling we conclude that evidence seems to be that ownership unbundling of transmission is a key part of energy market reform in the most successful reform jurisdictions

a 100 year review of electricity policy in ireland 1916 2015 abstract over the past century ireland s electricity sector has undergone a significant transformation this paper documents the nation s struggle to build an electricity system to improve security of electricity supply through portfolio diversification and to promote indigenous energy sources this was a challenge for an electrically isolated island with little natural resources the paper also identifies the ineffective policy decisions that left ireland exposed to the 1970s energy crises the crises did however provide a clear impetus for focusing irish energy policy going forward the successful deployment and integration of large scale wind power was due to strong national and supranational policy decisions in 2015 ireland had the third highest wind energy share of national electricity demand 22 8 of all iea wind member countries the paper also traces ireland s transition through market reform regional fragmentation and looks onwards to the eu internal market for electricity in essence this paper provides a holistic view of the implications of various policy decisions on the electricity sector along with the stresses of external factors on the electricity market and should be useful for policy makers elsewhere faced with similar decisions

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

transboundary pollution and the gains from trade we analyse the effects of transboundary pollution on trade patterns and welfare in a general equilibrium trade model production in a dirty industry generates pollution that negatively effects productivity both at home and abroad in a clean industry trade may lead to the spatial separation of production but the existence of transboundary pollution can offset the benefits from specialization we present a general model in which the effects of a country s pollution is country specific we analyse particular cases that correspond to an acid rain problem and a problem in which one country has a cleaner technology than the other we also present some results for small open economies to examine the effects of transboundary pollution in the absence of terms of trade effects

electricity distribution industry restructuring in south africa a case study for 20 years there has been vigorous debate about restructuring the large developed electricity industry in south africa but the plans have not been implemented the justification of the proposed restructuring illustrates the different expectations of the participants in the electricity industry the case study reviews what has occurred against a background of some theories about organisations and identifies six key issues some lessons include the need to adopt an industry structure compatible with the objectives of electricity distribution in developing countries the unsuitability of orthodox approaches to organisations that no industry structure appears to be significantly better than others industry restructuring of public sector utilities has a significant political dimension restructuring can fail even if there is support from a high level of government and indecision and uncertainty have serious negative consequences the experience should be helpful for other developing countries considering structural change of their electricity industry

assessing the sustainability challenges for electricity industries in asean newly industrialising countries abstract rapid social and economic progress in fast developing countries such that among the countries in the association of southeast asian nations asean have driven substantial growth in electricity consumption in this region whilst this represents significant societal and economic development it has potentially growing adverse environmental impacts this raises a concern on sustainable development in the electricity sector in this region this study evaluates key sustainability challenges in the electricity industries in the five largest energy consumers in asean indonesia thailand malaysia the philippines and vietnam the 3a s energy sustainability objectives accessibility availability and acceptability are used as the sustainability analytical framework this study also draws together a set of associated indicators and criteria within the analytical framework to analyse the status of the electricity industries in these countries the analysis shows that key sustainability challenges in the asean 5 are attributable to satisfying rapid demand growth enhancing security of electricity supply and mitigating the increase in co2 emissions from electricity generation given the promising resource and technical potential in this region renewable energy emerges as a favourable option to address these challenges however increasing the share of renewable energy in electricity generation requires considerable policy support this study suggests that there is an opportunity for the asean countries to strengthen regional collaborations through experience and resource sharing to enhance sustainability in the electricity industries this study also highlights some of the key issues facing the electricity industry and the need for new generation investment decision support tools which can address these issues