do media consumers really dislike advertising an empirical assessment of the role of advertising in print media markets this paper uses data on german consumer magazines observed between 1992 and 2004 to analyze the extent to which consumers dis like advertising we estimate logit demand models separately for the six most important magazine segments in terms of circulation we find little evidence for readers disliking advertising on the contrary we show that readers in many magazine segments appreciate advertising readers of women s magazines business and politics magazines as well as car magazines market segments where advertisements are relatively more informative appreciate advertising while advertising is nuisance to readers of adult magazines a segment where advertisements are particularly uninformative demand for interior design magazines is not well identified our logit demand estimates are confirmed by logit demand models with random coefficients and by magazine specific monopoly demand models

a derivation of the marginal abatement cost curve abstract the relationship between a firm s technology and its marginal abatement cost mac curve is explored even under the simplest specifications the mac curve will be kinked at some point except under a special assumption which in reality could easily be violated the nondifferentiability implies that the choice of instrument under uncertainty may depend on the targeted level of emissions reduction also stability conditions for dynamic tax mechanisms may be violated in the neighborhood of the kink point a policy implication is that in some cases output restrictions are as efficient as emissions restrictions in contrast to previous results

analysis of the economic impact of different chinese climate policy options based on a cge model incorporating endogenous technological change abatement cost is the main concern for climate change mitigation and the key factor for mitigation cost is technological change this study established an integrated economic energy environmental dynamic computable general equilibrium cge model representing endogenous technological change for china s climate change policy analysis this study analyzed and compared the economic impact of different approaches to mitigation commitments as well as the potential role of technological change in the formulation of mitigation targets and commitments taking into account china s climate policy making needs based on the current international climate negotiation process the results show that absolute emission limits similar to the kyoto protocol will seriously impede the future economic development of china while the impact of an 80 reduction in carbon intensity forecast for 2050 based on the 2005 level is relatively small technological change can promote economic growth improve energy efficiency and reduce carbon intensity per unit of output through the substitution of production factors consequently it can reduce marginal abatement cost and related gdp loss by mitigation at the same time it can increase mitigation potentials and extend the emission reduction amount showing that consideration of the impact of technological change when deciding the emission reduction targets is necessary

what are the key drivers of mac curves a partial equilibrium modelling approach for the uk marginal abatement cost mac curves are widely used for the assessment of costs related to co2 emissions reduction in environmental economics as well as domestic and international climate policy several meta analyses and model comparisons have previously been performed that aim to identify the causes for the wide range of mac curves most of these concentrate on general equilibrium models with a focus on aspects such as specific model type and technology learning while other important aspects remain almost unconsidered including the availability of abatement technologies and level of discount rates this paper addresses the influence of several key parameters on mac curves for the united kingdom and the year 2030 a technology rich energy system model uk markal is used to derive the mac curves the results of this study show that mac curves are robust even to extreme fossil fuel price changes while uncertainty around the choice of the discount rate the availability of key abatement technologies and the demand level were singled out as the most important influencing factors by using a different model type and studying a wider range of influencing factors this paper contributes to the debate on the sensitivity of mac curves

estimating the marginal abatement cost curve of co2 emissions in china provincial panel data analysis abstract this paper estimates the marginal abatement cost curve macc of co2 emissions in china based on a provincial panel for the period of 2001 2010 the provincial marginal abatement cost mac of co2 emissions is estimated using a parameterized directional output distance function four types of model specifications are applied to fit the mac carbon intensity pairs the optimal specification controlling for various covariates is identified econometrically a scenario simulation of china s 40 45 carbon intensity reduction based on our macc is illustrated our simulation results show that china would incur a 559 623 yuan t roughly 51 57 increase in marginal abatement cost to achieve a corresponding 40 45 reduction in carbon intensity compared to its 2005 level

a new approach to measuring shadow price reconciling engineering and economic perspectives abstract shadow price is one of the most important pieces of information in environmental decision making two different approaches namely economic and engineering have been applied to obtain the shadow price of undesirable outputs while using different methodological backgrounds and perspectives the current study proposes a new conceptual framework and an economic estimation model to reconcile the shadow price estimates derived via the two approaches we also suggest a new mapping rule that incorporates the concept of abatement level which is a basic element in the engineering approach as a result the proposed model generates continuously changing estimates i e comprising a shadow price curve based on the abatement level we further investigate the determinant factors of shadow price by using second step regression the suggested methodology is used to investigate the shadow price of carbon emissions in south korean electricity generating plants thus yielding relevant policy implications

a dynamic oligopoly structural model for the prescription drug market after patent expiration this article incorporates consumer learning and heterogeneity into a dynamic oligopoly model for the prescription drug market in the model both firms and patients need to learn the generic qualities via patients experiences generic firms entry decisions are endogenous but their entry timings depend on a random approval process i apply the model to examine the impact of shortening the expected generic approval time although this policy experiment brings generics to the market sooner it increases a potential entrant s likelihood of entering a crowded market and hence could reduce the total number of generic entrants and consumer welfare

voluntary export restraints on automobiles evaluating a trade policy the authors evaluate the voluntary export restraint that was initially placed on exports of automobiles from japan in 1981 they evaluate the impact this policy had on u s consumer welfare firm profits and foregone tariff revenue from its initiation through 1990

valuation of marginal co2 abatement options for electric power plants in korea the electricity generation sector in korea is under pressure to mitigate greenhouse gases as directed by the kyoto protocol the principal compliance options for power companies under the cap and trade include the application of direct co2 emission abatement and the procurement of emission allowances the objective of this paper is to provide an analytical framework for assessing the cost effectiveness of these options we attempt to derive the marginal abatement cost for co2 using the output distance function and analyze the relative advantages of emission allowance procurement option as compared to direct abatement option real option approach is adopted to incorporate emission allowance price uncertainty empirical result shows the marginal abatement cost with an average of 14 04 ton co2 for fossil fueled power plants and confirms the existence of substantial cost heterogeneity among plants which is sufficient to achieve trading gains in allowance market the comparison of two options enables us to identify the optimal position of the compliance for each plant sensitivity analyses are also presented with regard to several key parameters including the initial allowance prices and interest rate the result of this paper may help korean power plants to prepare for upcoming regulations targeted toward the reduction of domestic greenhouse gases

quantity restrictions on advertising commercial media bias and welfare abstract we study the welfare effect of a quantity restriction on advertising in free to air television and other advertising financed media in the presence of commercial media bias broadcasters face a trade off between increasing the number of viewers by sending content that is highly valued by viewers and increasing the price of advertising by choosing advertiser friendly content a cap on advertising drives the per viewer price of ads up thus content improves for viewers therefore the cap can be welfare enhancing even when viewers are not ad averse competition among broadcasters makes it more likely that a cap on advertising improves welfare thus there is a complementarity between regulation and competition on this market we also show that a tax on advertising revenues has quite different effects than a cap on advertising quantity

reference pricing and firms pricing strategies abstract within a horizontal differentiation model and allowing for heterogeneous qualities we analyze the effects of reference pricing reimbursement on firms pricing strategies with this analysis we find inherent incentives for firms pricing behavior and consequently we shed some light on the time consistency of such policy the analysis encompasses different reference price rules i reference price as the minimum of the observed prices in the market ii reference price as a linear combination of firms prices results show that under the minimum policy firms are not able to coordinate on higher prices while the linear policy implicitly provides a coordination device we have also found that relatively to the linear policy when the reference price is the minimum of observed prices after policy implementation total and private expenditures are higher and consumer surplus and firms profits are lower with quality differentiation both the minimum and linear policies unambiguously lead to higher prices

quantifying co2 abatement costs in the power sector co2 cap and trade mechanisms and co2 emission taxes are becoming increasingly widespread to assess the impact of a co2 price marginal abatement cost curves maccs are a commonly used tool by policy makers providing a direct graphical link between a co2 price and the expected abatement however such maccs can suffer from issues related to robustness and granularity this paper focuses on the relation between a co2 emission cost and co2 emission reductions in the power sector the authors present a new methodology that improves the understanding of the relation between a co2 cost and co2 abatement the methodology is based on the insight that co2 emissions in the power sector are driven by the composition of the conventional power portfolio the residual load and the generation costs of the conventional units the methodology addresses both the robustness issue and the granularity issue related to maccs the methodology is based on a bottom up approach starting from engineering knowledge of the power sector it offers policy makers a new tool to assess co2 abatement options the methodology is applied to the central western european power system and illustrates possible interaction effects between e g fuel switching and renewables deployment

competition in off patent drug markets issues regulation and evidence in recent years health insurers have placed a great deal of emphasis on the ability of generic medicines to deliver significant savings to overstretched health care budgets due to their lower cost and potential for a more efficient resource allocation in this paper we study market developments after patent expiry whether health insurance captures the financial benefits from cheaper generics and whether regulation and product differentiation among others have any power in explaining originator and generic price movements generic entry and diffusion we find that health insurance does not capitalize fully or fast enough on the cost advantage of generic medicines either because generic policies do not encourage their fast uptake or because generic drug prices are high and frequently tied directly or indirectly to originator drug prices we also find that reference pricing a particular form of reimbursement regulation encourages generic entry and reduces generic prices but only marginally finally in generic markets characterized by homogeneous products we find evidence of product differentiation which is impacting prices upwards rather than downwards if health insurance is to benefit fully from generic medicines it ought to encourage faster uptake and price competition and discourage price fixing regulation that ties generic prices to those of originator brands panos kanavos joan costa font and elizabeth seeley

marginal abatement costs of carbon dioxide emissions in china a parametric analysis this paper investigates the technical inefficiency shadow price and substitution elasticity of hbox co 2 emissions of china based on a provincial panel for 2001 2010 using linear programming to calculate a quadratic parameterized directional output distance function we show that china s technical inefficiency increases over the period implying further scope for hbox co 2 emissions reduction in the medium and longer term at best by 4 5 and 4 9 respectively our results notwithstanding regional differences highlight increases in the shadow price of hbox co 2 abatement 1 000 yuan ton in 2001 to 2 100 yuan ton in 2010 additionally increasingly steep substitution elasticity highlights the difficult reality of reducing china s hbox co 2 emissions

marginal abatement costs of greenhouse gas emissions from european agriculture cost effectiveness and the eu non ets burden sharing agreement abstract we propose a quantitative assessment of the marginal abatement costs mac of greenhouse gas emissions from european agriculture and analyze the implications of the non ets burden sharing agreement bsa for this sector this assessment is based on mac reduced forms the generic specification of which enables simple parameterization and numerical computations such mac curves are parameterized for each member state using the outputs of a detailed model of the european agricultural supply they are then used to compute total and marginal abatement costs involved by the bsa targets as well as the cost effective effort sharing the corresponding emission price and abatement costs the main findings are i flexibility mechanisms such as a cap and trade system for agricultural emissions could reduce the total costs of meeting the 10 eu abatement target by a factor two to three relative to the strict implementation of each country s target ii the corresponding equilibrium emission price is found to be 32 42 tco2eq depending on the assumption regarding business as usual emissions and iii a cap and trade system with allowances based on the bsa targets would involve substantial transfers from eu 15 countries to new member states an important share of which being made of hot air

applied welfare economics with discrete choice models economists have been paying increasing attention to the study of situations in which consumers face a discrete rather than a continuous set of choices such models are potentially very important in evaluating the impact of government programs upon consumer welfare but very little has been said in general regarding the tools of applied welfare economics indiscrete choice situations this paper shows how the conventional methods of applied welfare economics can be modified to handle such cases it focuses on the computation of the excess burden of taxation and the evaluation of quality change the results are applied to stochastic utility models including the popular cases of probit and logit analysis throughout the emphasis is on providing rigorous guidelines for carrying out applied work this abstract was borrowed from another version of this item

evaluating public policy mechanisms for climate change mitigation in brazilian buildings sector abstract this paper applies a multi criteria analysis mca and marginal abatement cost curves macc to evaluate public policies mechanisms to promote the dissemination of energy efficiency ee and on site renewable energy sources res technologies in brazilian buildings sector the objective here is to bring together the advantages of both methods in order to provide more valuable insights to policy makers the mca results show that in the case of more integrative policies which considers for instance potential of jobs creation the mechanisms to foster distributed res and solar water heaters are better ranked than in macc analysis where only cost effectiveness of each option is evaluated other key finding is that 1 there is a significant cost effective potential that could be reached through alternative mechanisms not implemented yet in the country such as public procurement regulation and building codes and 2 minimum energy performance standards meps could be broader in scope and more stringent and include the use of energy in standby mode and tubular fluorescent lamps in particular some important appliances such as large air conditioning devices should have more aggressive meps

the ranking of negative cost emissions reduction measures a flaw has been identified in the calculation of the cost effectiveness in marginal abatement cost curves maccs the problem affects negative cost emissions reduction measures those that produce a return on investment the resulting ranking sometimes favours measures that produce low emissions savings and is therefore unreliable the issue is important because incorrect ranking means a potential failure to achieve the best value outcome a simple mathematical analysis shows that not only is the standard cost effectiveness calculation inadequate for ranking negative cost measures but there is no possible replacement that satisfies reasonable requirements furthermore the concept of negative cost effectiveness is found to be unsound and its use should be avoided among other things this means that maccs are unsuitable for ranking negative cost measures as a result maccs produced by a range of organizations including uk government departments may need to be revised an alternative partial ranking method has been devised by making use of pareto optimization the outcome can be presented as a stacked bar chart that indicates both the preferred ordering and the total emissions saving available for each measure without specifying a cost effectiveness

limited information and advertising in the u s personal computer industry traditional discrete choice models assume buyers are aware of all products for sale in markets where products change rapidly the full information assumption is untenable i present a discrete choice model of limited consumer information where advertising influences the set of products from which consumers choose to purchase i apply the model to the u s personal computer market where top firms spend over 2 billion annually on advertising i find estimated markups of 19 over production costs where top firms advertise more than average and earn higher than average markups high markups are explained to a large extent by informational asymmetries across consumers where full information models predict markups of one fourth the magnitude i find that estimated product demand curves are biased toward being too elastic under traditional models i show how to use data on media exposure to improve estimated price elasticities in the absence of micro ad data

marginal co2 abatement costs findings from alternative shadow price estimates for shanghai industrial sectors abstract shanghai one of the most developed cities in china is implementing a pilot regional carbon emission trading scheme estimating the marginal abatement costs of co2 emissions for the industrial sectors covered in shanghai s emission trading scheme provides the government and participating firms useful information for devising compliance policies this paper employs multiple distance function approaches to estimating the shadow prices of co2 emissions for shanghai industrial sectors our empirical results show that the overall weighted average of shadow price estimates by different approaches ranges between 394 5 and 1906 1 yuan ton which indicates that model choice truly has a significant effect on the shadow price estimation we have also identified a negative relationship between the shadow price of co2 emissions and carbon intensity and the heavy industries with higher carbon intensities tend to have lower shadow prices it has been suggested that shanghai municipal government take various measures to improve its carbon market e g using the marginal abatement costs of participating sectors firms as a criterion in the initial allocation of carbon emission allowances

pricing profits and technological progress in the pharmaceutical industry the decades old debate over pharmaceutical industry prices profits and innovation has again intensified a number of events coalesced to refocus public interest on pharmaceuticals contributing to public concern were bureau of labor statistics price index increases for pharmaceuticals far outpacing those for the products of other industries another prominent characteristic of the pharmaceutical industry has been its extraordinarily high reported profitability this article examines the phenomena that precipitated the current pharmaceuticals debate their historical antecedents and the principal questions at issue in the author s considered judgment a pell mell march toward regulation of pharmaceutical industry pricing could seriously impair the industry s incentives for investment in new products

regulation and pricing of pharmaceuticals reference pricing or price cap regulation we study the relationship between regulatory regimes and pharmaceutical firms pricing strategies using a unique policy experiment from norway which in 2003 introduced a reference price rp system called index pricing for a sub sample of off patent pharmaceuticals replacing the existing price cap pc regulation we estimate the effect of the reform using a product level panel dataset covering the drugs exposed to rp and a large number of drugs still under pc regulation in the time before and after the policy change our results show that rp significantly reduced both brand name and generic prices within the reference group with the effect being stronger for brand names we also identify a negative cross price effect on therapeutic substitutes not included in the rp system in terms of policy implications the results suggest that rp is more effective than pc regulation in lowering drug prices while the cross price effect raises a concern about patent protection

tiered co payments pricing and demand in reference price markets for pharmaceuticals health insurance companies curb price insensitive behavior and the moral hazard of insureds by means of cost sharing such as tiered co payments or reference pricing in drug markets this paper evaluates the effect of price limits below which drugs are exempt from co payments on prices and on demand first using a difference in differences estimation strategy we find that the new policy decreases prices by 5 percent for generics and increases prices by 4 percent for brand name drugs in the german reference price market second estimating a nested logit demand model we show that consumers appreciate co payment exempt drugs and calculate lower price elasticities for brand name drugs than for generics this explains the different price responses of brand name and generic drugs and shows that price related co payment tiers are an effective tool to steer demand to low priced drugs

an assessment of household electricity load curves and corresponding co2 marginal abatement cost curves for gujarat state india gujarat a large industrialized state in india consumed 67 twh of electricity in 2009 10 besides experiencing a 4 5 demand supply short fall residential sector accounted for 15 of the total electricity consumption we conducted load research survey across 21 cities and towns of the state to estimate residential electricity load curves share of appliances by type and usage patterns for all types of household appliances at utility geographic appliance income and end use levels the results indicate that a large scope exists for penetration of energy efficient devices in residential sector marginal abatement cost mac curves for electricity and co2 were generated to analyze relative attractiveness of energy efficient appliance options results indicate that up to 7 9 twh of electricity can be saved per year with 6 7 mt co2 emissions mitigation at negative or very low co2 prices of us 10 t co2 despite such options existing their penetration is not realized due to myriad barriers such as financial institutional or awareness and therefore cannot be taken as baseline options for co2 emission mitigation regimes

estimation of random coefficient demand models two empiricists perspective we document the numerical challenges we experienced estimating random coefficient demand models as in berry levinsohn and pakes 1995 using two well known data sets and a thorough optimization design the optimization algorithms often converge at points where the first and second order optimality conditions fail there are also cases of convergence at local optima on convergence the variation in the values of the parameter estimates translates into variation in the models economic predictions price elasticities and changes in consumer and producer welfare following hypothetical merger exercises vary at least by a factor of 2 and up to a factor of 5

competition and collusion in the american automobile industry the 1955 price war movements in total quantity and in quality adjusted price suggest a supply side shock in the american automobile market in 1955 this paper tests the hypothesis that the shock was a transitory change in industry conduct a price war the key ingredients of the test are alternative equilibrium models of oligopoly under product differentiation in nonnested cox tests of hypotheses a collusive solution is sustained in 1954 and in 1956 while a competitive solution holds in 1955 the result does not appear to be an artifact since it is robust in tests against alternative specifications copyright 1987 by blackwell publishing ltd

marginal abatement costs of greenhouse gas emissions a meta analysis in this paper we carry out a meta analysis of recent studies into the costs of greenhouse gas mitigation policies that aim at the long term stabilisation of these gases in the atmosphere we find the cost estimates of the studies to be sensitive to the stringency of the stabilisation target the assumed emissions baseline the way in which the time profile of emissions is determined in the model the choice of control variable co2 only versus multigas the number of regions and energy sources in the model and to a lesser degree the scientific forum in which the study was developed we find that marginal abatement costs of the stringent long term targets that are currently considered by the european commission are still very uncertain but might exceed the costs that have been suggested by recent policy assessments

reference pricing competition and pharmaceutical expenditures theory and evidence from a natural experiment abstract we study the impact of regulation on competition between brand names and generics and pharmaceutical expenditures using a unique policy experiment in norway where reference pricing rp replaced price cap regulation in 2003 for a sub sample of off patent products first we construct a vertical differentiation model to analyze the impact of regulation on prices and market shares of brand names and generics then we exploit a detailed panel data set at product level covering several off patent molecules before and after the policy reform off patent drugs not subject to rp serve as our control group we find that rp significantly reduces both brand name and generic prices and results in significantly lower brand name market shares finally we show that rp has a strong negative effect on average molecule prices suggesting significant cost savings and that patients copayments decrease despite the extra surcharges under rp

generic entry price competition and market segmentation in the prescription drug market abstract this paper studies the effects of generic entry on post patent price competition for 18 prescription drugs recently exposed to competition an independent validating test of the generic competition paradox is conducted using a newly created data set each generic entrant is associated with an average 1 increase in the branded price the one way error component model accounts for intermolecular competition market segmentation and endogeneity of entry and finds branded prices increasing by 2 alternative definitions of entry suggest that price competition is confined to the generic market the unique payer type feature of the data offers empirical evidence supporting market segmentation

the cost of emission mitigation by legume crops in french agriculture this paper considers the cost of greenhouse gas mitigation potential of legume crops in french arable systems we construct marginal abatement cost curves to represent this mitigation or abatement potential for each department of france and provide a spatial representation of its extent despite some uncertainty the measure appears to offer a significant low cost mitigation potential we estimate that the measure could abate half of the emission reduction sought by a national plan for the reduction of chemical fertilizer emissions by 2020 this would be achieved at a loss of farmland profit of 1 2 considering the geographical heterogeneity of cost we suggest that a policy implementing carbon pricing in agriculture would be more efficient than a uniform regulatory requirement for including the crop in arable systems

price and welfare effects of a pharmaceutical substitution reform the price effects of the swedish pharmaceutical substitution reform are analyzed using data for a panel of all pharmaceutical product sold in sweden in 1997 2007 the price reduction due to the reform was estimated to average 10 and was found to be significantly larger for brand name pharmaceuticals than for generics the results also imply that the reform amplified the effect that generic entry has on brand name prices by a factor of 10 results of a demand estimation imply that the price reductions increased total pharmaceutical consumption by 8 and consumer welfare by sek 2 7 billion annually

marginal abatement cost curves for policy recommendation a method for energy system analysis abstract the transport sector is seen as one of the key factors for driving future energy consumption and greenhouse gas ghg emissions in order to rank possible measures marginal abatement cost curves have become a tool to graphically represent the relationship between abatement costs and emission reduction this paper demonstrates how to derive marginal abatement cost curves for well to wheel ghg emissions of the transport sector considering the full energy provision chain and the interlinkages and interdependencies within the energy system presented marginal abatement cost curves visualize substitution effects between measures for different marginal mitigation costs the analysis makes use of an application of the energy system model generator times for south africa times geeco for the example of gauteng province this study exemplary shows that the transport sector is not the first sector to address for cost efficient reduction of ghg emissions however the analysis also demonstrates that several options are available to mitigate transport related ghg emissions at comparable low marginal abatement costs this methodology can be transferred to other economic sectors as well as to other regions in the world to derive cost efficient ghg reduction strategies

how to decarbonize the transport sector this article investigates possible evolution pathways for the transport sector during the 21st century globally and in europe under a climate change control scenario we attempt to shed light on the question how the transport sector should best be decarbonized we perform our study with the global bottom up energy systems model tiam ecn a version of the tiam model that is broadly used for the purpose of developing energy technology and climate policy scenarios which we adapted for analyzing in particular the transport sector given the global aggregated perspective of tiam ecn that in its current version yields at every point in time a single co2 price for different forms of energy use across geographic regions and economic sectors it generates a decarbonization process that for the transport sector occurs later in time than for the power sector this merely reflects that emission reductions are generally cheaper for electricity production than for transportation and that it is thus cost minimizing to spend limited financial resources available for co2 emissions abatement in the power sector first in our scenarios the use of hydrogen in internal combustion engines and fuel cells rather than electricity as energy carrier and batteries to store it gradually becomes the dominant transport technology this outcome is in agreement with some recent publications but is at loggerheads with the current popularity of the electric car based on sensitivity analysis we conclude that even if the establishment of a hydrogen infrastructure proves about an order of magnitude more costly than modeled in our base case electricity based transportation only broadly emerges if simultaneously also the costs of electric cars go down by at least 40 with respect to our reference costs one of the explanations for why the electric car is today by e g entrepreneurs often considered the supposed winner amongst multiple future transportation options is that the decision horizon of many analysts is no more than a few decades instead of a full century electric cars fit better the current infrastructure than hydrogen fueled vehicles so that from a short time perspective covering the next decade or two investments are not optimally spent by establishing an extensive hydrogen distribution network hence the path dependency created by the present existence of a vast power transmission and distribution network can make electricity the most efficient choice for transportation but only if the time frame considered is short electric transportation generally proves the more expensive alternative in our long term perspective except when electric car costs are assumed to drop substantially

how costly is mitigation of non co2 greenhouse gas emissions from agriculture a meta analysis this text reviews the assessments of marginal abatement costs of methane and nitrous oxide emissions from agriculture we use agricultural emissions and the corresponding prices collected from 21 studies that have assessed abatement potentials and costs using various modeling approaches and assumptions we first highlight the implications of the modeling approach for marginal abatement costs harmonized abatement rates for three emission prices 10 20 and 50 2005 tco2eq are regressed on variables that reflect various modeling assumptions and study characteristics in a second step the emission price is introduced as an explanatory variable when controlling for a few key characteristics of the studies the models explain an important share of the observed variability in abatement rates the type of modeling approach is found to have a significant effect in particular we find that equilibrium models lead to higher abatement rates for a given price the flexibility in nitrogen use and its effect on crop yields also plays a significant role in lowering marginal abatement costs the results of the second step indicate that the price elasticity of the abatement rate is about 0 6 this estimate is found to be robust to several specifications and consistent with previous assessments covering other economic sectors

gps shifting agencies in choice of treatment earlier studies have shown that general practitioners gps prescription choices are influenced by effect patient costs and costs to society patient attitude and own experience this study builds on this knowledge and explores how prescription behaviour is affected when choices are made in different contexts where the conflicting roles as agents for the patient and agents for society are stressed a total of 309 danish gps were randomly allocated to one of three versions of a web based questionnaire which included a discrete choice experiment mixed logit models in willingness to pay wtp space were estimated with and without accounting for stated attribute non attendance results show that the gp s role as agent for his patients is clearly strengthened in the presence of national recommendations in contrast when recommendations are not present and when gps face a patient who is currently taking an expensive albeit effective medication the gp takes on his role as agent for society we find no evi

cost effectiveness of greenhouse gas mitigation in transport a review of methodological approaches and their impact abstract a review is given of methodological practices for ex ante cost effectiveness analysis cea of transport greenhouse gas ghg mitigation measures e g fuel economy and co2 standards for road vehicles in the us and eu besides the fundamental differences between different types of policies and abatement options which inherently result in different cea outcomes differences in methodological choices and assumptions are another important source of variation in cea outcomes fourteen methodological issues clustered into six groups are identified on which thirty three selected studies are systematically reviewed the potential variation between lower and upper cost effectiveness estimates for ghg mitigation measures in transport resulting from different methodological choices and assumptions lies in the order of 400 per tonne co2 eq the practise of using cea for policy making could improve considerably by clearly indicating the specific purpose of the cea and its strengths and limitations for policy decisions another improvement is related to the dominant approach in transport ghg mitigation studies the bottom up financial technical approach which assesses isolated effects implying considerable limitations for policy making a shift to welfare economic approaches using a hybrid model has the potential to establish an improved assessment of transport ghg mitigation measures based on realistic market responses and behavioural change

regulation of pharmaceutical prices evidence from a reference price reform in denmark reference price systems for prescription drugs constitute widely adopted cost containment tools under these regimes patients co pay a fraction of the difference between a drug s pharmacy retail price and a reference price that is set by the government reference prices are either externally based on drug prices in other countries or internally based on domestic drug prices determined we study the effects of a change from external to internal reference pricing in denmark in 2005 we find that the reform led to substantial reductions in retail prices reference prices and patient co payments as well as to sizable decreases in overall producer revenues and health care expenditures the reform induced consumers to substitute away from branded drugs for which we estimate strong preferences the increase in consumer welfare due to the reform therefore depends on whether or not we take perceived quality differences into account in its calculation

the applicability of marginal abatement cost approach a comprehensive review abstract the marginal abatement cost mac methodology is widely used in climate change policies policy makers rely on mac to assess feasible strategies and related costs to achieve emission reduction goals this paper introduces a variety of mac methodologies aiming at solving diverse problems which utilizes various calculable logic thus producing different results and implications this study applies a mind mapping method to capture differentiation of mac methods and systematically classify mac methodologies the applicability path analysis was proposed based on principles such as stakeholder type decision making objectives cost concept strategy mode and information scope our goal is to assess the applicability of different methodologies to reduce misuse by policy makers and to serve as a guide for subsequent research which might prompt and lead to the derivation of more consequential results in future studies the results of this study suggest that the complex method is not always better than the simplified method because policy makers are required to select the appropriate method according to the type of information needed it may even be suggested that mac could be reliable by ranking relative value of options compared with baseline rather than focusing on the absolute value of individual measures

competition and the reference pricing scheme for pharmaceuticals by introducing n 1 firms with infinite cross price elasticity i e generic drugs we explore the effects of competition on the optimal pricing strategies under a reference pricing scheme rps a two stage model repeated infinite number of times is presented when stage 1 is competitive the equilibrium in pure strategies exists and is efficient only if the reference price r does not depend on the price of the branded product when generics collude the way r is designed is crucial for both the stability of the cartel among generics and the collusive prices in equilibrium an optimally designed rps must set r as a function only of the infinitely elastic side of the market and should provide the right incentives for competition

improving the numerical performance of static and dynamic aggregate discrete choice random coefficients demand estimation the widely used estimator of berry levinsohn and pakes 1995 p roduces estimates of consumer preferences from a discrete choice demand model with random coefficients market level demand shocks and endogenous prices we derive numerical theory results characterizing the properties of the nested fixed point algorithm used to evaluate the objective function of blp s estimator we discuss problems with typical implementations including cases that can lead to incorrect parameter estimates as a solution we recast estimation as a mathematical program with equilibrium constraints which can be faster and which avoids the numerical issues associated with nested inner loops the advantages are even more pronounced for forward looking demand models where the bellman equation must also be solved repeatedly several monte carlo and real data experiments support our numerical concerns about the nested fixed point approach and the advantages of constrained optimization for static blp the constrained optimization approach can be as much as ten to forty times faster for large dimensional problems with many markets

estimating the environmental efficiency and marginal co2 abatement cost of coal fired power plants in china abstract we estimate the environmental efficiency reduction potential and marginal abatement cost of carbon dioxide co2 emissions from coal fired power plants in china using a novel plant level dataset derived from the first and second waves of the national economic survey which were implemented in 2004 and 2008 respectively the results indicate that there are large opportunities for co2 emissions reduction in china s coal fired power plants given that all power plants operate fully efficiently china s co2 emissions in 2004 and 2008 could have been reduced by 52 and 70 respectively accompanied by an expansion in electricity output in other words the opportunities for double dividend exist in 2004 the average marginal abatement cost of co2 emissions for china s power plants was approximately 955 yuan ton whereas in 2008 the cost increased to 1142 yuan ton the empirical analyses show that subsidies from the government can reduce environmental inefficiency but the subsidies significantly increase the shadow price of the power plants older and larger power plants have a lower environmental efficiency and marginal co2 abatement cost the ratio of coal consumption negatively affects the environmental efficiencies of power plants

multiple product firms a nested logit approach this paper proves the existence of a symmetric equilibrium with multiproduct firms using a nested logit model of demand the demand model is parameterized by two variables that characterize different dimensions of preference for variety these reflect intragroup heterogeneity and intergroup heterogeneity a group or nest being the set of products produced by a firm there are then two dimensions to market performance the total number of firms and the range of products produced per firm it is shown that the market equilibrium involves an excessive number of firms but each firm provides too few products copyright 1992 by blackwell publishing ltd

the cost of reducing co2 emissions integrating abatement technologies into economic modeling we explore two methods of incorporating bottom up abatement cost estimates into top down modeling an economy wide method and a sector specific method carbon emissions generally depend on technology and scale given the technology options abatement is possible without a substantial reduction in scale otherwise the change must come purely through a reduction in demand our analysis shows that the cost of environmental policy is considerably overestimated by top down models if a bottom up abatement cost curve is not included using the data for the swiss economy we demonstrate two techniques of representing an abatement function explicitly in a computable general equilibrium model a traditional and a hybrid discrete technology modeling approach the results suggest that the current climate policy in switzerland will not be able to move the economy towards the required 10 co2 reduction both approaches provide virtually the same results when the calibration process is precisely executed which contradicts the results of previous studies

price structure in two sided markets evidence from the magazine industry we present and estimate a model of competition in a two sided market the market for magazine readership and advertising using data on magazines in germany we find evidence that magazines have properties of two sided markets the results are consistent with the perception that prices for readers are subsidized and that magazines make all their money from advertisers consistent with advertisers valuing readers more than readers value advertisements our results imply that higher demand on the reader side increases ad rates but that higher demand on the advertising side decreases cover prices