nep-ene New Economics Papers
on Energy Economics
Issue of 2005‒05‒29
ten papers chosen by
Roger Fouquet
Imperial College, UK

  1. The Latin American and Caribbean Energy Review 2003 By Mauricio Garrón; Alejandro Villarreal; Byron Chiliquinga; Annette Fitzpatrick; Maria Sircia de Sousa
  2. Discontinuous Extraction of a Nonrenewable Resource By Eric Iksoon Im; Ujjayant Chakravorty; James Roumasset
  3. Do daily retail gasoline prices adjust asymmetrically? By Bettendorf, L.; Geest, S.A. van der; Kuper, G.H.
  4. The Effects of Higher Gasoline Prices on U.S. Light Vehicle Sales, Prices, and Variable Profit by Segment and Manufacturer Group, 2001 and 2004 By Walter McManus
  5. A Competitive Fringe in the Shadow of a State Owned Incumbent: The Case of France By Jean-Michel Glachant; Dominique Finon
  6. The Nordic Market: Signs of Stress? By Nils-Henrik M. von der Fehr; Eirik S. Amundsen; Lars Bergman
  7. Liberalising the Dutch Electricity Market: 1998-2004 By Eric van Damme
  8. Should developing countries participate in the Clean Development Mechanism under the Kyoto Protocol ? The low-hanging fruits and baseline issues By Marc, GERMAIN; Alphonse, MAGNUS; Vincent, VAN STEENBERGHE
  9. Interest of site-specific pollution control policies By Lacroix, A.; Bel, F.; Mollard, A.; Sauboua, E.
  10. Consumption Externalities, Production Externalities and Efficient Capital Accumulation under Time Non-separable Preferences By Stephen J Turnovsky; Goncalo Monteiro

  1. By: Mauricio Garrón (Latin American Energy Organization); Alejandro Villarreal (Latin American Energy Organization); Byron Chiliquinga (Latin American Energy Organization); Annette Fitzpatrick (Latin American Energy Organization); Maria Sircia de Sousa (Latin American Energy Organization)
    Abstract: The 2003 Energy review,contains information about the 2003 energy situation of each of our member countries, regional data, as well as economic and social indicators corrected and extended through historical series. It presents and innovative structure for analysis that allows the reader to easily find general information on the energy sectors of the 26th OLADE Member Countries. With the objective of enriching the statistical value that the document has presented since initial editions, this document contains the participation of our Technical Coordinators in the each of our specialized areas of our Organization: Energy Policy, Hydrocarbons, Electricity, Statistical Information, Renewable Energy and Environment. It is likely to emphasize in this occasion, for the first time the Energy Report is spread into the immediate year subsequent to the one of reference, as it was obtained thanks to the effort of our specialists and the cooperation of our Countries Members. The modern world presents us with constant changes and challenges for the security of supply that sets dynamic integration within the strategic areas. In this sense, we expect that this document will be a useful tool to face the challenges of the Energy Sector of our Region.
    Keywords: Energy, energy policy, hydrocarbons, natural gas, electricity, renewables, latin america, bolivia, argentina, chile, peru, uruguay, paraguay, brasil, ecuador, colombia, mexico, venezuela, costa rica, honduras, nicaragua, panamá, el salvador, guatemala, trinidad y tobago, jamaica, barbados, haiti, cuba
    JEL: P Q Z
    Date: 2005–05–25
  2. By: Eric Iksoon Im (Department of Economics, University of Hawaii at Hilo); Ujjayant Chakravorty (Department of Economics, University of Central Florida, Orlando); James Roumasset (Department of Economics, University of Hawaii at Manoa)
    Abstract: This paper examines the sequence of optimal extraction of nonrenewable resources in the presence of multiple demands. We provide conditions under which extraction of a nonrenewable resource may be discontinuous over the course of its depletion.
    Keywords: backstop technology, dynamic optimization, energy resources, Herfindahl principle, multiple demands
    JEL: Q3 Q4
    Date: 2005
  3. By: Bettendorf, L.; Geest, S.A. van der; Kuper, G.H. (Groningen University)
    Abstract: This paper analyzes adjustments in the Dutch retail gasoline prices. We estimate an error correction model on changes in the daily retail price for gasoline (taxes excluded) for the period 1996-2004 taking care of volatility clustering by estimating an EGARCH model. It turns out the volatility process is asymmetrical: an unexpected increase in the producer price has a larger effect on the variance of the producer price than an unexpected decrease. We do not find evidence for amount asymmetry, either for the long run or for the short run. However, there is a faster reaction to upward changes in spot prices than to downward changes in spot prices. This implies timing or pattern asymmetry. This asymmetry starts three days after the change in the spot price and lasts for four days.
    Date: 2005
  4. By: Walter McManus (University of Michigan)
    Abstract: The rising gasoline prices of the past few years were not associated with shifts from vehicles with lower MPG to vehicles with higher MPG. This has been seen as evidence that gasoline prices have little impact on the purchase choices of new-vehicle buyers. However, this paper presents new evidence that the shifts toward vehicles with higher MPG that the rising price of gasoline would have caused were not observed because they were offset by price cuts that were disproportionately applied to vehicles with lower MPG.
    Keywords: fuel economy; gasoline prices; automobile demand; nested multinomial logit; variable profit
    JEL: L62
    Date: 2005–05–25
  5. By: Jean-Michel Glachant; Dominique Finon
    Abstract: We examine what kind of competitive fringe has been built in France around the State owned incumbent without destroying it or significantly weakening its dominant position; what impacts has this particular reform process on the market in which the incumbent monopolist is still overly dominant; and what more can be done to strengthen the opening of the market while staying in this typical French policy framework (no industrial restructuring and no forced divestiture by the monopolist). We wonder if a larger window of opportunity will open up at some later date for contesting the position of the monopolist, especially when investment in generation resumes.
    Date: 2005–05
  6. By: Nils-Henrik M. von der Fehr; Eirik S. Amundsen; Lars Bergman
    Abstract: The supply shock that hit the Nordic electricity market in 2002-2003 put the market to a severe test. A sharp reduction in inflow to hydro reservoirs during the normally wet months of late autumn pushed electricity prices to unprecedented levels. We take this event as the starting point for analysing some potential weaknesses of the Nordic market. We conclude that fears regarding supply security and adequacy are likely to be unfounded. Nevertheless, as inherited over-capacity is eroded, and new market-based environmental regulation takes effect, tighter market conditions are to be expected. It is then crucial that retail markets are fully developed so as to allow consumers to adequately protect themselves from occurrences of price spikes.
    Date: 2005–05
  7. By: Eric van Damme
    Date: 2005–05
  8. By: Marc, GERMAIN; Alphonse, MAGNUS; Vincent, VAN STEENBERGHE
    Abstract: Under the Kyoto Protocol, industrialized countries committed to emission reductions may fullfil part of their obligations by implementing emission reduction projects in developing countries. In doing so, they make use of the so-called Clean Development Mechansim (CDM). Two important issues surround the implementation of the CDM. First, if the cheapest abatment measures are implemented for CDM projects, developing countries may be left with only more expensive measures when they have to meet their own commitments in the future (the so-called low-hanging fruits issue). Second, a choice must be made on the type of baseline against which emission reductions are measured : an absolute baseline or a relative (to output) one (the baseline issue). The purpose of this paper is to study the interactions between these two issues from the point of view of the developing country. Two major results are obtained. First, when possible future commitments for developing countries and irreversibility of abatement measures are taken into account, we show that the industry where CDM projects are implemented enjoys large profits under an absolute baseline than under a relative one. Second, concerning the low-hanging fruits problem, the financial compensation required by the developing country for implementing ‘too many’ CDM projects is larger under the relative baseline.
    Date: 2004–12–22
  9. By: Lacroix, A.; Bel, F.; Mollard, A.; Sauboua, E.
    Abstract: Owing to increasing environmental concerns the current trend is to bend technical production systems in order to adapt them to the specific characteristics of the milieu and diversify them. Inherent to such dynamics is the issue of how to design the accompanying environmental policies. Theoretically, spatially targeted environmental policies are considered optimal, since economic agents tune their efforts according to the sensitivity of the milieu where they operate. But, according to empirical analyses, this advantage is undermined by the high cost of implementation, monitoring and enforcement. This paper outlines the conditions required for site-specific policies to be effective at least cost. Our starting point is the nitrate pollution of water from agriculture, which varies according to climate, soil type and agricultural production system. Farm management practices enabling to reduce pollution depend on this variability. An interdisciplinary study of the efficiency of differentiating the way this pollution is regulated was carried out on two sites in France. It focussed on assessing the importance of spatial variability in physical parameters and in private and social costs.
    JEL: C15 H71 Q16 Q25
    Date: 2004
  10. By: Stephen J Turnovsky; Goncalo Monteiro
    Abstract: We examine the effects of both consumption and production externalities on capital accumulation and economic performance under time non-separable preferences and a non-scale production technology. We show that a consumption externality in isolation has long-run distortionary effects if and only if labour is supplied elastically. With fixed labour supply, it has only transitional distortionary effects, though it may generate long-run distortions through its interaction with the production externality. Production externalities always generate long-run distortions, irrespective of labour supply. The optimal taxation to correct for the distortions is characterized. Further quantitative insights are obtained by supplementing the theoretical analysis with numerical simulations based on the calibration of a plausible macroeconomic growth model.
    Keywords: Time non-separable preferences; consumption and production externalities; capital accumulation; optimal tax policy
    JEL: D91 E21 O40

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