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on Regulation |
| By: | Jansen, Eilev S.; Krogh, Tord S. H. |
| Abstract: | The interaction between financial markets and the macroeconomy can be strongly affected by changes in credit market regulations. In order to take account of these effects the authors control explicitly for regime shifts in a system of debt equations for Norway using a common, flexible trend. The estimated shape of the trend matches the qualitative development in the regulations, and the authors argue that it can be viewed as a measure of relative credit availability, or credit conditions, for the period 1975-2008 - a credit conditions index (CCI). This entails years of strict credit market regulations in the 1970s, its gradual deregulation in the 1980s, followed by a full-blown banking crisis in the years around 1990 and the development thereafter up to the advent of the current financial crisis. Our study is inspired by Fernandez-Corugedo and Muellbauer (2006), which introduced the methodology and provided estimates of a CCI for the UK. The trend conditions on a priori knowledge about changes in the Norwegian regulatory system, as documented in Krogh (2010b), and it shows robustness when estimated recursively. -- |
| Keywords: | credit conditions,flexible trend,financial deregulation,household loans |
| JEL: | E44 G21 G28 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwedp:201112&r=reg |
| By: | KAWAHAMA Noboru; TAKEDA Kuninobu |
| Abstract: | How is merger-generating efficiency dealt with in antitrust regulation? The Japan Fair Trade Commission (JFTC) presents a consumer welfare standard, which focuses on the change of consumer welfare in evaluating efficiency. Guidelines of U.S. antitrust law and those of EU competition law support this standard as well, and the experience in Canadian competition law reveals the difficulty of applying a total welfare standard. In this paper, we examine the possibility of convergence between market power analysis and efficiency consideration under the consumer welfare standard. Based upon that, we propose a modified consumer welfare standard, under which welfare can be traded off among consumers. |
| Date: | 2011–03 |
| URL: | http://d.repec.org/n?u=RePEc:eti:rdpsjp:11022&r=reg |
| By: | Nepal, R.; Jamasb, T. |
| Abstract: | This paper assesses the electricity sector reforms across small power systems while citing Nepal as an example. The on-going political instability and increasing electricity demand make power sector reform in Nepal and similar small systems a more complex process. As international reform experiences provide plenty of lessons to learn; raising electricity tariffs and adjusting subsidies in the presence of an effective regulation body are important in the short and medium term. The creation of an effective regulatory commission is also more urgent than unbundling the sector in smaller systems though accounting separation may sometimes be desirable as in the present context in Nepal. In the long run as the system grows, vertical separation and competitive privatisation may be pursued together with the creation of a functioning wholesale market by horizontally splitting the generation segments. |
| JEL: | L52 L94 Q48 |
| Date: | 2011–04–05 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1133&r=reg |
| By: | KOJIMA Noriaki |
| Abstract: | Many people consider the softening of regulations under the Agency Work Law as excessive deregulation. However, the tightening of regulations that are currently under way or are expected to be implemented in the field of employment laws is more properly called excessive regulation.<br /><br />The typical form of non-regular employment is part-time employment, but agency work accounts for only one-ninth of part-time employment. Excluding students and people 65 or older, growth in non-regular employment has clearly been slowing in recent years.<br /><br />Even though casual employment has increased, regular employment has grown at a faster pace. For both men and women, regular employees account for a historically high percentage of total employment. Although for women, growth in casual employment has surpassed that for men, there has been a major decline in unpaid family workers. If one considers that these unpaid family workers have become paid casual employees, it is not necessarily true that unstable employment has increased.<br /><br />In the debate regarding the strengthening of regulations of non-regular employment, many people are swept away by momentary arguments charged with emotions and based on impressions, and they are not properly aware of these facts. In fact, when it comes to the agency workers, which has become the target of efforts to strengthen regulations, there is conspicuous excessive regulation. In terms of work related to the operation of office equipment, the typical type of work for agency workers, there is a strange phenomenon that the number of agency workers continues to decline even though the economy has slightly recovered.<br /><br />It is expected that after the strengthening of regulations under the Agency Work Law, the tightening of regulations of fixed-term employment, that is the restricting the case of concluding the fixed-term employment contract to temporary jobs will be implemented. It is, however, overly optimistic to assume that restricting fixed-term employment will lead to an increase in regular employment. Without an appropriate level of regulation, workplaces will not be able to cope with these regulations. This must not be forgotten. |
| Date: | 2011–04 |
| URL: | http://d.repec.org/n?u=RePEc:eti:rdpsjp:11058&r=reg |
| By: | Föllmi, Reto; Meister, Urs |
| Abstract: | In most developed countries, the provision of water is organized at a local level. The costs and tariffs vary significantly, even between adjacent water utilities. Such heterogeneity is an obvious indication of the sector’s overall inefficiency and stresses a need for institutional adjustments. We show that cooperation by water trade and the introduction of competition by common carriage between adjacent utilities are valuable alternatives to improve the industry’s efficiency, even when mergers are not feasible. Because both approaches require the physical connection of neighboring networks, they may have similar effects. This paper analyzes and compares the relevant welfare gains and shows that production efficiency and retail prices may differ depending on the initial cost differential, the application of regulations and the distribution of bargaining power. Using a theoretical model, we show that at higher initial production cost differentials, welfare is higher under competitive conditions, even in a lowerbound benchmark case without any regulation. |
| Keywords: | Water, Networks, Product-Market Competition, Trade, Bargaining. |
| JEL: | L95 L43 D21 Q25 |
| Date: | 2011–05 |
| URL: | http://d.repec.org/n?u=RePEc:usg:econwp:2011:21&r=reg |
| By: | Bolotova, Yuliya; Novakovic, Andrew |
| Abstract: | The New York State Milk Price Gouging Law establishes that the retail prices of fluid milk products are not to exceed 200% of the prices that NYS milk processors py for Class I milk. The enforcement of this law significantly affected the nature of the Class I fluid milk price transmission process and the milk pricing strategies of supermarkets in the five largest cities in New York State: New York City, Albany, Syracuse, Buffalo and Rochester. During the pre-law period, supermarkets used a retail price-stabilization strategy, as evidenced by asymmetric Class I fluid milk price transmission. In contrast, supermarkets use a retail profit stabilization strategy during the law period. This variation of retail milk price control actually creates an institutional environment that facilitates cooperative conduct of supermarkets, acting in an oligopolistic market environment, which caused greater instability in retail milk prices. Differences in the competitive environments of each city impact the effects of the statewide law. |
| Keywords: | dairy, milk, price regulation, price transmission, asymmetric price response, food retailing, Agribusiness, Agricultural and Food Policy, Demand and Price Analysis, Industrial Organization, Marketing, Q11, Q13, Q18, |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea11:104514&r=reg |
| By: | Jamasb, T.; Marantes, C. |
| Abstract: | Electricity distribution networks are capital intensive systems and timely investments are crucial for long-term reliability of their service. In coming years, in the UK, and elsewhere in Europe, many networks are in need of extensive investments in their aging assets. Also, aspects of energy policy concerning climate change, renewable energy, energy efficiency, demand side management (DSM), network energy loss reduction, quality of service standards, and security of supply require active, flexible, and smart networks that can be achieved through investments. This paper is a chapter in the forthcoming book "Jamasb T. and Pollitt, M. G. (2011) Eds., The Future of Electricity Demand: Customers, Citizens and Loads, Cambridge University Press: Cambridge" and describes a network investment assessment model developed as a tool to identify and assess the investment requirements of distribution networks. A broadening of the scope of network investments to include demand-related measures that can reduce the need for investments. |
| JEL: | L94 |
| Date: | 2011–01–31 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1115&r=reg |
| By: | Littlechild, S. |
| Abstract: | Interstate gas pipelines and their customers presently settle about 90% of the rate cases set for hearing before the Federal Energy Regulatory Commission (FERC). In recent years, the median time for negotiating settlements and having them approved is about 11 months, compared to several years to complete litigated hearings. This paper explores how this is achieved. FERC has a tight schedule for the hearing process. In contrast to other jurisdictions, FERC Trial Staff play an active role in facilitating negotiation and settlement. They propose a first settlement offer 3 months after a pipeline files for a tariff rate increase. An analysis of the 9 cases over the last two years where full and uncontested settlement was reached shows that discussions led by Trial Staff led to agreement in principle in a median time of 2 ½ months after this first offer, just before testimony would otherwise need to have been filed. It took a further 2 ½ months for the parties to finalise the wording of the settlement and to obtain the judge’s certification that it was uncontested, and 3 months for FERC formally to approve it. FERC’s settlement process has worked successfully and essentially unchanged for over 35 years. It suggests a more active role for the regulatory body than was previously apparent. |
| JEL: | L51 L95 |
| Date: | 2011–01–31 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1116&r=reg |
| By: | KURODA Sachiko; YAMAMOTO Isamu |
| Abstract: | This paper uses a Japanese time use survey to examine how the timing of work in Japan has changed since the 1990s, focusing on changes in labor market regulation, open-hour legislation, and a huge negative demand shock that hit the economy from the early 1990s. We find a noteworthy increase in the share of employees working at unusual hours (late night and early morning) over a period of a decade since the mid 1990s. When controlling for changes in hours worked, however, we find that the notable increase in the fraction of people working at unusual hours was for low-income non-regular workers (part time, temporary and contract workers), while relatively higher-income regular employees' work timing remains stable. These observations imply that there is a trend of diversification of work timing in Japan between regular and non-regular workers. An Oaxaca-Blinder type decomposition suggests that increased demand for services and goods by regular employees at unusual hours, possibly due to more implementation of the five-day workweek since the 1990s, partially explains the rise in the employment rate of non-regular employees at unusual times. |
| Date: | 2011–04 |
| URL: | http://d.repec.org/n?u=RePEc:eti:rdpsjp:11053&r=reg |
| By: | SHIMADA Yoichi |
| Abstract: | With reform of the legal framework related to fixed-term employment contracts fast approaching, I examine in concrete terms problems of creating such laws from the perspective of avoiding excessive regulation of fixed-term employment contracts. My analysis is based on a report created by the Fixed-term Employment Contract Study Group organized by the Ministry of Health, Labour and Welfare, and I consider the fact that demand for workers with a fixed-term employment contract is mainly medium- and long-term, not temporary and special. <br /><br />The general principle of permanent employment contracts is asserted when strictly regulating the use of fixed-term employment contracts. However this is not a general principle embodied in the actual employment contract but is a policy preference from the perspective of stable employment. The general principle of permanent employment contracts would dramatically restrict the use of employees with a fixed-term employment contract in current employment practices in Japan and force these changes. However, legal restrictions on fixed-term employment contracts cannot be considered an appropriate legal policy since they do not take into consideration how companies will meet their medium- and long-term demand for labor. Assuming that employees with fixed-term employment contracts—for which there is a medium- and long-term demand—continue to be permitted, the current legal issue becomes providing an appropriate scope of protection. In particular, the law should clearly state the possibility of renewing fixed-term employment contracts when concluding or renewing the contract and demand that the reason for terminating employment in the case the contract is not renewed be objectively justifiable and socially appropriate. |
| Date: | 2011–04 |
| URL: | http://d.repec.org/n?u=RePEc:eti:rdpsjp:11060&r=reg |
| By: | Garth Heutel |
| Abstract: | When consumers exhibit present bias and are time-inconsistent, the standard solution to market failures caused by externalities—Pigouvian pricing—is suboptimal. I investigate policies aimed at externalities for time-inconsistent consumers. Welfare-maximizing policy in this case includes an instrument to correct the externality and an instrument to correct the present bias. Either instrument can be an incentive-based policy or a command-and-control policy. Calibrated to the US automobile market, simulation results from a model with time-inconsistent consumers suggest that the second-best gasoline tax is 18%–30% higher than marginal external damages. These simulations also suggest that social welfare is maximized with a gasoline tax set about equal to marginal external damages and a fuel economy tax that increases the price of an average non-hybrid car by about $750–$2200 relative to the price of an average hybrid car. |
| JEL: | Q48 Q58 |
| Date: | 2011–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17083&r=reg |