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

international environmental agreements for river sharing problems we study partial coalition formation and the strategic timing of membership of an iea for environmental issues in the coalitional bargaining game cbg of gomes econometrica 73 1329 1350 2005 we apply the cbg to a specific river sharing problem with two symmetric upstream agents each at a tributary and one downstream agent located at the junction of tributaries we identify five regions in the parameter space of a discount factor and a productivity parameter for water in one region the grand coalition always forms immediately in two other regions immediate formation of the grand coalition and gradual coalition formation both occur with positive probability in another two regions only gradual coalition formation occurs in one of these latter regions a region with discount factors close to one both upstream agents form a monopoly with positive probability formation of the monopoly persists in the limit as the discount factor goes to one

why invest in wind energy career incentives and chinese renewable energy politics we study wind development at the provincial level in china modelling installed wind capacities as a function of both economics and politics we assume that the top provincial officials desire to maximize their chances of promotion under the chinese cadre evaluation system we expect that those with the strongest incentives to perform in order to achieve promotion would work harder to comply with the central government s policy agenda to promote renewable energy collecting and testing data on provincial leaders characteristics we find that provinces governed by party secretaries who were approaching the age of 65 are associated with significantly higher level of wind installed capacities this result supports the political tournaments theory of chinese politics we also find that better educated party secretaries are likely to be more supportive of renewable energy implying that education acts to encourage provincial leaders to support the central government s policy

the empirical relationship between money prices and income revisited this article investigates the relationship between sum divisia and monetary velocity money prices and income using the notion of granger 1969 causality this is achieved by evaluating empirically using dickey fuller unit root tests whether the macroeconomic time series under consideration are trend stationary or difference stationary and by conducting tests using three different ad hoc lag lengths 8 6 and 4 quarters as well as a statistically determined using akaike s 1969a b final prediction error criterion lag structure

uk electricity market reform revolution or much ado about nothing abstract the uk government has published a white paper on electricity market reform which precedes legislation with a declared aim of delivering secure clean and decarbonised electricity supply it introduces interventionist methods aiming to promote a nuclear power construction programme a streamlined renewables programmes and a system to ensure that generation capacity is built to cope with variability in electricity output however the policies announced to date are likely to fail in delivering the promised nuclear programme and the system of feed in tariffs announced for renewables is stunted and made less efficient by a desire to integrate it with the prevailing electricity market arrangements the effect of the changes in the white paper is likely to be incremental rather than revolutionary

a social coalitional equilibrium existence lemma the purpose of this paper is to construct an abstract model of a society in which each member can cooperate with others by forming a coalition but at the same time can be influenced by the members outside the coalition a new concept of equilibrium called here a social coalitional equilibrium is proposed and a sufficient condition for its existence provided the social coalitional equilibrium may be considered a synthesis of the nash equilibrium a noncooperative solution concept and the core a cooperative solution concept the paper provides a broadly applicable mathematical tool for proving existence of equilibrium for models of labor managed market economies the purpose of the present paper is to construct an abstract model of a society in which each member can cooperate with others by forming a coalition but at the same time can be influenced by the members outside the coalition a new concept of equilibrium called here a social coalitional equilibrium is proposed and a sufficient condition for its existence provided a coalition structure is endogenously determined in equilibrium when the model is suitably specified it describes noncooperative behavior of the members and the social coalitional equilibrium is reduced to the nash equilibrium given another extreme specification the model is reduced to a cooperative game without sidepayments in characteristic function form and the set of social coalitional equilibria corresponds precisely to the core the need for study of the present model arose originally out of the author s recent investigation of labor managed market economies both the socialistic version and the capitalistic version in 10 11 12 indeed the model and the concept of social coalitional equilibrium were obtained by abstracting and generalizing the formal aspect of those studies the socialistic labor managed market economy has long been the object of study of various authors see e g vanek 19 the capitalistic labor managed market economy seems to reflect the institutional aspect of the modern capitalistic society better than the economies formulated by other available general equilibrium models it differs for example from the standard private ownership economy of arrow and debreu 1 see also debreu 6 sec 5 5 in that i the ownership and control of a firm are separated ii no particular firm is given a priori but instead the list of potential firms is given as a primitive datum and iii the behavioral principle of the economic agents involves both noncooperative behavior and cooperative behavior because of the above feature ii any general equilibrium model of this economy has to formulate the economic mechanism that underlies the formation of firms in equilibrium as

income velocity and the variability of money growth evidence from less developed countries this paper examines whether the variability of money growth caused changes in income velocity of money in 30 less developed countries time series data show year to year variations in income velocity of money in these countries for the 1961 1990 period empirical results based on causality but complemented by variance decomposition tests show that money growth is the most important determinant in explaining the variability in income velocity in at least 20 of the 30 developing countries examined in this study in addition the causality results show that inflation rate granger causes income velocity of money in 21 countries but the variance decomposition results show inflation rate to be relatively more important in explaining the variability of velocity in eight countries similarly while real income granger causes velocity of money in 18 countries the results of the variance decomposition tests show real income to be relatively more important as a determinant of income velocity in two countries over

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

marginal contributions and externalities in the value our concern is the extension of the theory of the shapley value to problems involving externalities using the standard axiom systems behind the shapley value for an arbitrary exogenous coalition structure leads to the identification of bounds on players payos around an externality free value in endogenizing the coalition structure we analyze a two stage process of coalition formation in whose second stage our axiomatic results are applied we find reasons to explain inecient coalition structures and provide sucient conditions for eciency

bargaining and value we present and analyze a model of noncooperative bargaining among n participants applied to situations describable as games in coalitional form this leads to a unified solution theory for such games that has as special cases the shapley value in the transferable utility tu case the nash bargaining solution in the pure bargaining case and the recently introduced maschler owen consistent value in the general nontransferable utility ntu case moreover we show that any variation in a certain class of our bargaining procedure which generates the shapley value in the tu setup must yield the consistent value in the general ntu setup

analysis and recommendations for onshore wind power policies in china abstract recently china s wind power industry is challenged by many problems such as wind power integration and wind curtailment which seriously hinders the development of onshore wind power since china s policy has a direct and significant influence on wind power industry it is vital to analyze and evaluate published policies this paper explores in detail 134 china s onshore wind power policies from 2005 to 2015 so as to provide analytical support for future formulation and implementation of wind power policy based on policy summary from equipment manufacturing industry wind farms and power grid industry this paper evaluates the policies from the perspective of overall plan support policy and policy implementation using fitting method game theory and empirical analysis the results indicate that china s wind policy is gradually becoming perfected for example there are more reasonable objectives and improved support policies however many problems remain to be solved like unreasonable planning imperfect support policies immature trading systems and uncoordinated actions among interest related parties furthermore combined with international experiences suggestions on improving china s wind power policy are proposed from seven aspects

effective market monitoring in deregulated electricity markets experience with deregulated electricity markets has shown that the assumption that markets will naturally produce competitive results is not justified the existing independent system operators isos and emerging regional transmission organizations rtos all have developed or are developing systems and procedures to accomplish the monitoring task in their markets this paper provides an overview of the key elements necessary for effective design and implementation of market monitoring systems market monitoring must be concerned primarily with ensuring efficient market performance by identifying market inefficiencies the potential for market abuses and market power problems in this paper we define market power and identify factors that allow the exercise of market power in electricity markets we also propose market efficiency objectives that should be used to design market rules that discourage gaming we then identify the issues relevant to designing and implementing an effective market monitoring function

western china energy development and west to east energy transfer application of the western china sustainable energy development model china is striving for coordinated regional economic development and to solve the energy shortage in eastern china through a western china development plan with one focus being energy development and west to east energy transfer this paper describes western china sustainable energy development model wsed to evaluate various energy development scenarios for western china the model includes a western china markal model a computable general equilibrium model for western china wcge and an energy service demand projection model esdp the esdp provides energy service demand projections for the western china markal model while the wcge provides macroeconomic inputs for the esdp and analyzes the impact of different energy development scenarios on western china economy a reference scenario and several different west to east energy transfer scenarios with and without consideration of the water constraints and the endogenous technology learning are presented the modeling describes the energy consumption carbon emissions water consumption energy investment cost and the impact on western china gdp of the different scenarios through the year 2050 these results have implications on sustainable energy development policies and sustainable west to east energy transfer strategies

lag length selection and tests of granger causality between money and income one of the most widely accepred relationships in macroeconomics is the positive relationship between the rate of growth of the money supply and the rate of growth of income a diversity of opinion arises however with the attempt to identify a causal relationship between these variables while friedman and schwartz 1963 initiated the empirical investigation of money income causality sims 1972 made the most significant contribution to this literature with a practical application of the criterion developed by granger 1969 for identifying a causal relationship since the appearance of sims s approach and an alternative one advanced by sargent 1976 many researchers have applied these techniques to the investigation of the causal relationship between money and income l with two exceptions hsiao 1981 and mcmillin and fackler 1984 these researchers have arbitrarily chosen the lengths of their distributed lags the purpose of this paper is to test for granger causality between money and income this paper differs from previous work in that considerably more attention is focused on the effect of the lag specification on the test results in particular we investigate the extent to which rules of thumb arbitrary lag specifications and

weakly monotonic solutions for cooperative games abstract the principle of weak monotonicity for cooperative games states that if a game changes so that the worth of the grand coalition and some player s marginal contribution to all coalitions increase or stay the same then this player s payoff should not decrease we investigate the class of values that satisfy efficiency symmetry and weak monotonicity it turns out that this class coincides with the class of egalitarian shapley values thus weak monotonicity reflects the nature of the egalitarian shapley values in the same vein as strong monotonicity reflects the nature of the shapley value an egalitarian shapley value redistributes the shapley payoffs as follows first the shapley payoffs are taxed proportionally at a fixed rate second the total tax revenue is distributed equally among all players

development policy for non grid connected wind power in china an analysis based on institutional change abstract government policy continues to play a crucial role in the development of wind power industry in china the 2005 renewable energy law and related policies have driven the rapid increase in wind power installed capacity in china over the past half decade with capacity doubling annually since 2005 however a large number of wind farms generate electricity well below their installed capacity resulting in considerable wastage of resources non grid connected wind power theory proposes that large scale wind power output does not necessarily have to be fed into the grid but can be used directly in industrial production thus the use of the theory can promote the sustainable development of the wind power industry by obviating the need for power grid in this paper we analyze the influence of government policy on wind power industry from the perspective of institutional change by employing the basic theories of new institutional economics a development model for non grid connected wind power is proposed in order to implement institutional change in accordance with the specific characteristics of wind power industry in china this model requires the government to play an active role in institutional development by increasing economic efficiency in order to promote the sustainable development of wind power

a large amount of idle capacity under rapid expansion policy analysis on the dilemma of wind power utilization in china abstract wind power installation in china has increased rapidly since 2004 however wind power usage remains relatively low resulting in a lot of idle capacity beginning in 2007 in this paper we determine the main framework of china s current wind power policies and illustrate how these policies led to the rapid installation expansion accompanied by large idle capacity building on this we explore how to alleviate the high installation low wind power usage conflict in china we establish optimal models to i analyze wind power and power grid company behavior ii demonstrate the impact of china s current policies on power and grid companies and iii clarify the causes and mechanisms resulting in high growth and low wind power capacity usage our analysis shows that the incentive incompatibility of current policies which enticed power companies to pursue installation expansion regardless of quality while inhibiting grid companies from improving connectivity transmission and scheduling technology is the primary cause for such large scale idle capacity the results of our study suggest that the fundamental way to scale up wind power utilization is to enhance policy incentive compatibility which mainly includes i distributing revenues and diversifying risk fairly between power and grid companies and ii motivating power companies to address demand fluctuation actively

bidding for the surplus a non cooperative approach to the shapley value abstract we propose a simple mechanism to determine how the surplus generated by cooperation is to be shared in zero monotonic environments with transferable utility the mechanism consists of a bidding stage followed by a proposal stage we show that the subgame perfect equilibrium outcomes of this mechanism coincide with the vector of the shapley value payoffs we extend our results to implement the weighted shapley values finally we generalize our mechanism to handle arbitrary transferable utility environments the modified mechanism generates an efficient coalition structure and implements the shapley values of the super additive cover of the environment journal of economic literature classification numbers c71 c72

friedman s velocity hypothesis abstract the purpose of this note is to report tests of friedman s velocity hypothesis that money growth volatility affects velocity in the case of france the evidence provides some additional support for this hypothesis however the evidence is less clear out than the one found in studies of other industrial countries

sharing a fish stock when distribution and harvest costs are density dependent we studied cooperative and competitive solutions for managing a trans boundary fish stock that has a stock size dependent distribution and harvesting costs using norwegian spring spawning nss herring clupea harengus as a case study this is among the first studies to investigate the effect of a dynamic distribution in a partition function game framework i e including externalities the special feature of nss herring is that it comes under the sole ownership of norway when the stock size is sufficiently low the three players in our game are differentiated by stock ownership cost per unit effort and stock elasticity of harvest we find that cost asymmetry improves the likelihood of forming a stable grand coalition as harvesting load can be assigned to each fishing zone according to a player s relative cost level and the density of fish a dynamic distribution increases the bargaining power of norway because of her ability to control both the total stock and the stock shares in different zones especially during the stock transition years however the bargaining power of norway may disappear if her cost of harvesting exceeds that of the other players this loss of bargaining power can take on two forms first a dynamic distribution may encourage a minor player to free ride because norway needing a coalition partner to improve her cost effectiveness would be less inclined to retaliate as retaliation hurts her ally as much as the free rider second in a stable grand coalition norway is not guaranteed to receive an allocation of benefit shares in proportion to not to say in excess of her stock ownership at the current stock condition the strategy where norway reduces stock abundance below the level where the stock becomes non migratory is found attractive only if the discounting rate is sufficiently high

core existence in vertically differentiated markets we prove that a sufficient condition for the core existence in a n firm vertically differentiated market is that the qualities of firms products are equispaced along the quality spectrum this result contributes to see that a fully collusive agreement among firms in such markets is more easily reachable when product qualities are not distributed too asymmetrically along the quality ladder

a field study on matching with network externalities we study the effects of network externalities within a protocol for matching faculty to offices in a new building using web and survey data on faculty s attributes and choices we identify the different layers of the social network institutional affiliation coauthorships and friendships we quantify the effects of network externalities on choices and outcomes disentangle the layers of the networks and quantify their relative influence finally we assess the protocol used from a welfare perspective our study suggests the importance and feasibility of accounting for network externalities in assignment problems and evaluates techniques that can be employed to this end jel c78 c93 d62 d85 z13

the stochastic shapley value for coalitional games with externalities abstract a long debated but still open question in the game theory literature is that of how to extend the shapley value to coalitional games with externalities while previous work predominantly focused on developing alternative axiomatizations in this article we propose a novel approach which centers around the coalition formation process and the underlying probability distribution from which a suitable axiomatization naturally follows specifically we view coalition formation in games with externalities as a discrete time stochastic process we focus in particular on the chinese restaurant process a well known stochastic process from probability theory we show that reformulating shapley s coalition formation process as the chinese restaurant process yields in games with externalities a unique value with various desirable properties we then generalize this result by proving that all values that satisfy the direct translation of shapley s axioms to games with externalities can be obtained using our approach based on stochastic processes

sharing a river among satiable agents abstract we consider the problem of efficiently sharing water from a river among a group of satiable agents since each agent s benefit function exhibits a satiation point the environment can be described as a cooperative game with externalities we show that the downstream incremental distribution is the unique distribution which both is fair according to the aspiration welfare principle and satisfies the non cooperative core lower bounds on the other hand the cooperative core may be empty furthermore the downstream incremental distribution satisfies all core lower bounds for all connected coalitions if and only if each agent s individual rationality constraint is independent of the behavior of the other agents

wildlife corridor market design an experimental analysis of the impact of project selection criteria and bidding flexibility in this work we used controlled laboratory experiments to investigate the impact of project selection criteria and bidding flexibility on the economic performance of wildlife corridor auctions bidders coordinated their bids to form valid corridors and compete with other valid corridors to be successful we tested the impact of bidding flexibility in terms of a bidders differentiating their offers for different eligible corridors and b bidders submitting a single offer that would automatically be considered for all eligible corridors within the bidding options we compared the performance of the auctions under a net benefit and a benefit cost ratio selection criteria we found that participants conditioned their offers in terms of corridor benefit information as a consequence allowing multiple offers significantly increased payment and rent extraction on the other hand a single offer restriction facilitated a higher proportion of valid agreements and reduced rent extraction and as a result the agency s payment we could not find any significant difference between project selection criteria in terms of payment and rent extraction these results provide important insights for policy makers engaged in conservation market design throughout the world

bargaining and cooperation in strategic form games in this paper we view bargaining and cooperation as an interaction superimposed on a game in strategic form a multistage bargaining procedure for n players the proposer commitment procedure is presented it is inspired by nash s two player variable threat model a key feature is the commitment to threats we establish links to classical cooperative game theory solutions such as the shapley value in the transferable utility case however we show that even in standard pure exchange economies the traditional coalitional function may not be adequate when utilities are not transferable jel c70 c71 c78 d70

on generation integrated energy storage generation integrated energy storage gies systems store energy at some point along the transformation between the primary energy form and electricity instances exist already in natural hydro power biomass generation wave power and concentrated solar power gies systems have been proposed for wind nuclear power and they arise naturally in photocatalysis systems that are in development gies systems can compare very favourably in both performance and total cost against equivalent non integrated systems comprising both generation and storage despite this they have not hitherto been recognised as a discrete class of systems consequently policy decisions affecting development or demonstration projects and policy approaches concerning low carbon generation are not fully informed this paper highlights that policy structures exist militating against the development and introduction of gies systems probably to the detriment of overall system good

random walks and monetary velocity in the g 7 countries new evidence from a multiple variance ratio test the random walk hypothesis rwh of the velocity of money has often been supported for the developed economies the literature is however far from unanimous this paper employs the most recent methodological advances in testing for random walks the multiple variance ratio test to re examine the behaviour of the velocity of money in the g 7 countries monetary velocity is computed as the ratio of nominal income to contemporaneous money stock under alternative definitions of income and money the empirical results from the present study do not support the rwh in most of the g 7 countries with the us m1 and m2 velocities as exceptions furthermore the results show that the rwh is sensitive to either the definitions of monetary velocity or the sample period of study

renewable energy policy and electricity market reforms in china the article examines the potential effectiveness of the renewable energy policy in china and its regulatory law framework it frames the option of renewable energy technology within the background of the long lasting electricity problems that china has faced including serious supply shortages reliance on coal and severe environmental contamination its dual administrative and ownership system based on state and privately owned industry is discussed together with the market reform measures adopted in the sector current renewable energy policy is analysed and the scope of the 2005 renewable energy promotion law is investigated this is conducted within the context of the electricity sector reform that china adopted and its effects upon the prospects of encouraging as well as expanding the development of renewable energy this study draws upon primary information collected from interviews with stakeholders on the policy adequacy and identifies three main types of shortcomings that have interfered with a more successful expansion of renewable energy in china

endogenous formation of coalitions the formation of coalitions is a fundamental problem in game theory by a coalition is meant a group of players e g economic or political agents which decide to act together as one unit relative to the rest of the players this includes the instances of syndicates unions cartels blocks political parties parliamentary coalitions etc we would like to emphasize that forming a coalition does not eliminate the individual players as decision makers in all interactions with the other players coalition members act as one unit it may be useful to think of a representative agent taking their place 2 however this arrangement will continue only as long as each player finds it desirable to act this way further bargaining occurs among the members of each coalition on how to divide what they obtained together thus the existence of coalitions implies that the interactions among the players will be conducted on two levels first among the coalitions and second within each coalition most of the existing models in economics and game theory assume that the coalition structure is given exogenously instead we try here to obtain it as an endogenous outcome of our model namely we want to be able to predict which coalitions will in fact form in each given situation 3 our theory combines two kinds of game theoretic concepts value and stability the basic idea is first to evaluate the players prospects in the various coalition structures and then based on these values to find which ones are stable we will call this value coalition structure value or cs value for short the reason we are considering coalition structures i e partitions of the set of players into disjoint coalitions rather than just coalitions is that in general players may find it to their advantage to join forces in some situations and to act separately in others all depending on the way the other participants are organized this implies that both the value and the stability concepts should depend on the entire coalition structure the cs value we analyze in this paper was first developed by owen 7

rational bargaining in games with coalitional externalities this paper provides a flexible strategic framework to analyze bargaining and values in environments with coalitional externalities within this framework we propose a new value that extends the shapley value to partition function form games the so called rational belief shapley rbs value we investigate the strategic foundation of the rbs value by constructing an implementation mechanism this mechanism extends existing models of multilateral bargaining by allowing players a higher degree of freedom to form coalitions the same framework of bidding and renegotiation allows for natural variations of the rbs mechanism in this way alternative shapley like values are obtained and a unified platform to analyze and compare these solutions is provided

the impact of renewable energies on eex day ahead electricity prices in this paper we analyze the impact of renewable energies wind and photovoltaic on the formation of day ahead electricity prices at eex we give an overview of the policy decisions concerning the promotion of renewable energy sources in germany and discuss their consequences on day ahead prices an analysis of electricity spot prices reveals that the introduction of renewable energies enhances extreme price changes in the frame of a dynamic fundamental model we show that there has been a continuous electricity price adaption process to market fundamentals furthermore the fundamental drivers of prices differ among hours with different load profiles our results imply that renewable energies decrease market spot prices and have implications on the traditional fuel mix for electricity production however the prices for the final consumers increased overall because they must pay in addition the feed in tariffs for the promotion of renewable energy

a limit theorem for the core of betrand oligopoly games with externalities abstract this paper formulates the concept of betrand oligopoly partition games furthermore it is demonstrated that such well defined games have positive externalities more importantly the core is proved to approximate the equal division solution in infinite markets

on the externality free shapley shubik index abstract we address the problem of extending the shapley shubik index to the class of simple games with externalities introduced in alonso meijide et al 2017 on the one hand we provide bounds for any efficient symmetric and monotonic power index on the other hand we characterize the restriction of the externality free value of de clippel and serrano 2008 to the class of games under study by adapting well known properties

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

political and institutional analysis of the successes and failures of china s wind power policy this paper identifies and explains how political and institutional factors have determined the relative successes and failures of china s wind power policy over the period 2005 2011 it finds that china has made significant progress in pursuing its wind power policy in terms of cumulative installed capacity wind turbine manufacturing industry development and wind turbine cost and argues that these achievements can be attributed to the political motives and institutional arrangements of the chinese government as well as to institutional changes on the other hand the paper finds that there are two prominent policy failures namely the low proportion of grid connected capacity and the rising trend of wind turbine incidents these have undermined the efficiency and effectiveness of china s wind power program the paper holds that the institutional sources for the first policy failure lies in the preference for setting wind power development targets in terms of installed capacity rather than generation and in coordination problems while the second policy failure lies in the lack of state technical codes for wind power integration and the unfair competition from the large state owned power companies the paper contributes to the academic literature on the political and institutional roles in china s wind power policy

velocity effects of anticipated and unanticipated money growth and its variability the purpose of this paper is to empirically test the relationship between velocity growth and anticipated and unanticipated money growth and its variability in particular by decomposing actual monetary growth into anticipated and unanticipated components the study investigates whether knowledge of past variability of anticipated and unanticipated monetary growth improves the prediction of future velocity growth beyond predictions that are based on past velocity growth alone this is the empirical definition of granger causality comparasions are made in all tests among simple sum and divisia aggregates of m1 m2 m3 and l and with spindt s monetary velocity mq aggregate

the evolution of wind energy policies in china 1995 2014 an analysis based on policy instruments abstract the rapid growth of china s installed wind power capacity in recent years is closely related to the wind energy policies issued by the chinese government using content analysis and quantitative analysis methods this paper studies the historical evolution of chinese wind energy policies based on 72 wind energy policies issued in the past two decades 1995 2014 this paper analyzes the issuing organization form number and stringency of wind energy policies and compares different policy instruments in two periods the results show that the number and stringency of wind energy policies fluctuated greatly from 1995 to 2014 and that more than twenty organizations had independently or jointly issued the policies the main organization issuing wind energy policies however is the department that controls key economic and administrative resources and not the one that is in charge of wind energy of the 72 policies issued twenty three took the form of notices and eleven were measures as to the policy instrument environmental policies are most widely applied by the chinese government and regulation control and goal planning instruments are the ones most frequently adopted furthermore the application of supply and demand type policies is inadequate and few effective instruments have been adopted

velocity and the variability of money growth evidence from granger causality tests note economists and policy makers were caught off guard by the behavior of the income velocity of money in 1982 the velocity of m1 which had grown at a 3 3 percent average annual rate from 1970 1981 fezl by 4 4 percent in 1982 in the fourth quarter of 1982 the decline was 12 6 percent at an annual rate the 1982 decline in velocity significantly reduced nominal gnp growth and may have helped cause the fall in real gnp the 1982 episode has generated quite a bit of controversy the decline in velocity is important not only for its possible relation to real gnp but also because it has led some economists to seriously question monetarism monetarists believe that there is a predictable link between money growth and nominal gnp growth when velocity declined in 1982 that link appeared to have weakened seemingly undermining the monetarist beliefs in fact robert gordon 1983 has called the 1982 episode the velocity recession and the demise of monetarism milton friedman 1984 has stated that the decline in velocity does not undermine monetarism at all he believes that velocity fell because of the extreme volatility of money growth following the announced change in federal reserve operating procedures in october 1979 figure 1 shows the income velocity of m1 v and the standard deviation of current and seven lags of m1 growth s a large increase in the volatility of money growth in 1980 precedes the decline in velocity in 1982 based on this friedman states that the 1982 episode strengthens not weakens the case for the monetarist proposition of a constant growth rule of the money supply this paper uses the granger causality method to test friedman s hypothesis that the volatility of money growth causes velocity to change we conclude that friedman is correct i e the volatility of money measured by the standard deviation of money growth causes velocity in the granger sense in the next section we review some of the recent explanations offered by economists for the 1982 decline in velocity the concluding section presents our results of the granger tests of friedman s hypothesis

the value of holding scarce wind resource a cause of overinvestment in wind power capacity in china abstract china s wind power capacity has increased dramatically in recent years but about 30 of the installed capacity sits idle so overinvestment in wind power capacity seems to be a serious problem this paper explores reasons for the overinvestment the economic analysis shows that given uncertain future policy on wind power it is optimal for power companies to invest more than the amount in a certain world a part of the overinvestment has a real value which can be interpreted as the value of holding scarce wind resource this value exists because the wind rich sites with convenient locations to connect to the grids are scarce resource and also because the specific government policies that are essential for promoting wind power are uncertain in the future this value should be taken into account in the investment decision but it results in the phenomenon of overinvestment the concept of the value of holding scarce resource can be generally applied to the resources that are scarce and for which the future policy is uncertain

to what extent does wind power deployment affect vested interests a case study of the northeast china grid abstract china s wind power is in an embarrassing state along with its dramatic development since 2005 its curtailment ratio has been rising although this could be attributed to both physical and institutional factors it is the institutional obstacles mainly resulting from the adjustment difficulties of interests distribution that have exercised a greater impact the stakeholders relating to wind power integration are thermal power companies grid companies and local governments the extent to which wind power deployment affects these vested interests determines the core institutional obstacles to be addressed mainly based on quantitative and case analyses we argue that currently wind deployment in china has a little impact on the interests of thermal companies moderate impact on the interests of grid companies and great impact on local governments we recommend that it is crucial to elevate the role of environmental protection and renewable energy increase while de emphasize the role of economic growth in the evaluation of local governments performance as well as provide incentives for grid companies to attend more to their social responsibilities rather than their scale expansion and revenue growth

the stability of hedonic coalition structures we consider the partitioning of a society into coalitions in purely hedonic settings i e where each player s payoff is completely determined by the identity of other members of her coalition we first discuss how hedonic and nonhedonic settings differ and some sufficient conditions for the existence of core stable coalition partitions in hedonic settings we then focus on a weaker stability condition individual stability where no player can benefit from moving to another coalition while not hurting the members of that new coalition we show that if coalitions can be ordered according to some characteristic over which players have single peaked preferences or where players have symmetric and additively separable preferences then there exists an individually stable coalition partition examples show that without these conditions individually stable coalition partitions may not exist we also discuss some other stability concepts and the incompatibility of stability with other normative properties journal of economic literature classification numbers c71 a14 d20

efficient bidding with externalities we implement a family of efficient proposals to share benefits generated in environments with externalities these proposals extend the shapley value to games with externalities and are parametrized through the method by which the externalities are averaged we construct two slightly different mechanisms one for environments with negative externalities and the other for positive externalities we show that the subgame perfect equilibrium outcomes of these mechanisms coincide with the sharing proposals

developing pathways for energy storage in the uk using a coevolutionary framework abstract a number of recent techno economic studies have shown that energy storage could offer significant benefits to a low carbon uk energy system as it faces increased challenges in matching supply and demand however the majority of this work has not investigated the real world issues affecting the widespread deployment of storage this paper is designed to address this gap by drawing on the systems innovation and socio technical transitions literature to identify some of the most important contextual factors which are likely to influence storage deployment specifically it uses a coevolutionary framework to examine how changes in ecosystems user practices business strategies institutions and technologies are creating a new selection environment and potentially opening up the energy system to new variations of storage for both electricity and heat the analysis shows how these different dimensions of the energy regime can coevolve in mutually reinforcing ways to create alternative pathways for the energy system which in turn have different flexibility requirements and imply different roles for storage technologies using this framework three pathways are developed user led decentralised and centralised which illustrate potential long term trajectories for energy storage technologies in a low carbon energy system

lloyd shapley s matching and game theory this is a survey of lloyd shapley s contributions to matching theory and game theory in general starting with the work that inspired the swedish academy to award the 2012 nobel memorial prize in economic sciences to lloyd shapley and alvin roth

open access and the evolution of the u s spot market for natural gas federal regulations promoting open access transportation dramatically altered the organizational structure of the u s market for natural gas in the 1980s generally unbundling the merchant and transport functions of interstate pipelines an empirical analysis of wellhead spot prices is undertaken to examine the effect of open access on the geographic scope of the spot market using monthly spot price data from 1984 91 three statistical tests are applied and compared price correlations granger causality and cointegration we find that open access integrated the regional wellhead markets into a national competitive market for natural gas the effects of unbundling on contracts for natural gas are then investigated incentives for long term contracts between pipelines and producers are shown to be effectively removed by the introduction of competitive buying and selling of gas at the wellhead through open access

money is what money does monetary aggregation and the equation of exchange this paper develops a method for distilling the transactions role of the array of monetary assets available to the public into a single aggregate measure of effective transactions balances the result is a monetary quantity index number designated mq which corresponds closely with the monetary aggregate contemplated in the equation of exchange mv pq in general mq and the conventional aggregate m 1 exhibit strikingly similar behavior however during episodes when the behavior of m1 is abnormal relative to income and interest rates mq behaves differently from m 1 during these periods anomalies in the behavior of mq are not detectable

long and short term interest rates in a risky world abstract the paper develops and tests a general equilibrium model in which variability or risk affects the choice of portfolios our measures of variability include only the variability of unanticipated growth in monetary and non monetary aggregates and our tests use data ending with the change in federal reserve procedures in october 1979 we find that increased variability of unanticipated money growth raises demands for debt and money and reduces the demand for real capital interest rates on both short and long term debt rise by a risk premium we estimate the size of the risk premium before and after the october 1979 change and we show that the change in federal reserve procedures moved the economy to a less efficient point

efficiency in coalition games with externalities a natural extension of superadditivity is not sufficient to imply that the grand coalition is efficient when externalities are present we provide a condition analogous to convexity that is sufficient for the grand coalition to be efficient and show that this also implies that the appropriately defined core is nonempty moreover we propose a mechanism which implements the most efficient partition for all coalition formation games and characterizes the resulting payoff division

stable coalition structures with externalities this paper argues that the sign of external effects of coalition formation provides a useful organizing principle in examining economic coalitions in many interesting economic games coalition formation creates either negatie externalities or posi tie externalities for nonmembers examples of negative externalities are research coalitions and customs unions examples of positive externalities include output cartels and public goods coalitions i characterize and compare stable coalition structures under the following three rules of coalition formation the open

sharing the surplus an extension of the shapley value for environments with externalities economic activities both on the macro and micro level often entail wide spread externalities this in turn leads to disputes regarding the compensation levels to the various parties affected we propose a method of deciding upon the distribution of the gains costs of cooperation in the presence of externalities when forming the grand coalition is efficient we show that any sharing rule satisfying efficiency linearity dummy player and a strong symmetry axioms can be obtained through an average game adding an additional axiom we identify one unique rule satisfying these properties