nep-reg New Economics Papers
on Regulation
Issue of 2016‒04‒23
ten papers chosen by
Natalia Fabra
Universidad Carlos III de Madrid

  1. Environmental Policy Design, Innovation And Efficiency Gains In Electricity Generation By Nick Johnstone; Shunsuke Managi; Miguel Cárdenas Rodríguez; Ivan Haščič; Hidemichi Fujii; Martin Souchier
  2. Wind Electricity Subsidies = Windfall Gains for Land Owners? Evidence from Feed-In Tariff in Germany By Peter Haan; Martin Simmler
  3. Higher Price, Lower Costs? Minimum Prices in the EU Emissions Trading Scheme By Jan Abrell; Sebastian Rausch; Hidemichi Yonezawa
  4. Has the Restructuring of EU Electricity Markets Reduced Industrial Electricity Prices? By Hyland, Marie
  5. Integration of Energy Storage and Distributed Generation (DG) in Distribution Systems: Economic Analysis and Development Perspective By Mohajeryami, Saeed; Jennings, Ronald; Alkhbbaz, Ghadeer
  6. Analysing investment and disinvestment decisions under uncertainty, firm heterogeneity and tradable output permits By Feil, Jan-Henning; Mußhoff, Oliver
  7. Incentive compatible networks and the delegated networking principle By Rui Gong; Frank Page
  8. Using Feedback as a Tool for Household Energy Conservation: An Experimental Approach By Kannika Thampanishvong
  9. Self-regulation in collaborative environments : the case of the equator principles in banking By Bos J.W.B.; Contreras M.G.; Kleimeier S.
  10. Rethinking the political economy of decentralization: how elections and parties shape the provision of local public goods. By Raúl A. Ponce-Rodríguez; Charles R. Hankla; Jorge Martinez-Vazquez; Eunice Heredia-Ortiz

  1. By: Nick Johnstone; Shunsuke Managi; Miguel Cárdenas Rodríguez; Ivan Haščič; Hidemichi Fujii; Martin Souchier
    Abstract: This paper explores the relationship between environmental regulation, innovation, and competitiveness, drawing upon a unique dataset on environmental regulations directed at combustion plants, a global dataset of power plants, and a global dataset of ‘environmental’ patents. The analysis is conducted in two stages. First, a nonparametric frontier analysis is implemented to estimate efficiency scores, including a measure of technological innovation based on patent stocks. Second, econometric methods are applied to analyse the role of policy stringency and policy design on efficiency. Our estimation sample covers thermal power plant sectors in 20 countries from 1990 to 2009. The results show that the stringency of environmental regulations is a significant determinant of productive efficiency with respect to pollutant emissions as well as fuel use. However, these effects turn negative once the level of stringency leaps over a certain threshold. In addition, the paper concludes that the positive effect of regulatory stringency can be diminished by a negative effect of regulatory differentiation with measures which are differentiated across plant size and age having negative consequences, and these effects are increasing over time. This finding is important given the prevalence of size- and vintage-differentiated policies in many countries. Finally, it is found that integrated approaches to environmental innovation are more likely to bring about efficiency improvements than end-of-pipe technologies. Cet article étudie les relations entre réglementation environnementale, innovation et efficacité, en s’appuyant sur un ensemble de données mondiales sur les inventions « environnementales » brevetées et sur les centrales électriques, ainsi que sur un jeu unique de données sur la réglementation environnementale applicable aux installations de combustion. Cette étude comporte deux étapes. Dans un premier temps, des scores d’efficience sont estimés à l’aide d’une analyse non-paramétrique de la frontière efficiente de production, en utilisant notamment des indicateurs d’innovation comme les stocks de brevets. Ensuite, l’impact des politiques environnementales sur ces scores d’efficience est analysé économétriquement. Notre analyse couvre le secteur des centrales thermiques dans 20 pays entre 1990 et 2009. Les résultats montrent que des politiques environnementales contraignantes ont un effet positif sur l’efficacité de la production tant concernant l’émission de polluants que la consommation de carburant. Néanmoins, cet effet devient négatif lorsque la contrainte réglementaire dépasse un certain seuil. Par ailleurs, l’effet positif d’une réglementation contraignante peut être atténué lorsque celle-ci est différentiée en fonction de l’âge ou de la taille de la centrale. Les conséquences négatives d’une telle différentiation se font alors souvent sentir à long terme. Compte tenu de la prédominance d’une telle approche dans de nombreux pays, ce constat invite à une refonte des politiques environnementales en matière de limitation des émissions polluantes. Enfin, il est également constaté que des innovations environnementales intégrées (modifiant l’ensemble de la chaine de production) ont un impact plus important sur l’efficacité de la production que les innovations de fin de processus.
    Keywords: policy design, regulatory differentiation, productive efficiency, environmental innovation, directional distance function, fonction de distance directionnelle, innovation environnementale, élaboration des politiques, efficience productive, différentiation de la réglementation
    JEL: O33 Q48 Q55
    Date: 2016–04–14
  2. By: Peter Haan; Martin Simmler
    Abstract: In 2013, around 121 billion US-Dollar were spend worldwide to promote the investment into renewable energy sources. The most prominent support scheme employed is a feed-in tariff, which guarantees a fixed price for electricity produced by renewable energies sources, usually for around 15 years after the installation of the plant. We study the incidence of wind turbine subsidies, due to a feed-in tariff in Germany, into land prices to shed light on who benefits from the subsidies. In order to identify the incidence share we exploit quasi-experimental variation in wind strength across 270 non-urban counties combined with an institutional reform and use an Instrumental Variable estimator based on administrative transactionprices. We find that between 15 and 20% of expected wind turbine profits are capitalized into land prices. Using the estimated incidence share of 15%, we find that wind turbine subsidies account for roughly 4% of overall agricultural income of land owners in 2007.
    Keywords: Incidence, subsidy, renewable energy, wind turbines, land prices
    JEL: H22 H23 H25 Q28 Q42
    Date: 2016
  3. By: Jan Abrell (ETH Zürich, Switzerland); Sebastian Rausch (ETH Zurich, Switzerland); Hidemichi Yonezawa (ETH Zurich, Switzerland)
    Abstract: This paper examines the efficiency and distributional impacts of introducing a price floor in an emissions trading system (ETS) when environmental regulation is partitioned. We theoretically characterize the conditions under which a price floor enhances welfare. Using a multi-country multi-sector numerical general equilibrium model of the European carbon market, we find that moderate minimum price levels in the EU ETS can reduce the costs of EU climate policy by up to thirty percent and yield outcomes close to uniform carbon pricing. Moreover, most of the EU Member States would gain. Our results are robust with respect to parametric uncertainty in production and consumption technologies.
    Keywords: Emissions Trading, Price Floors, EU ETS, Partitioned Environmental Regulation, General Equilibrium
    JEL: H23 Q52 Q58 C68
    Date: 2016–04
  4. By: Hyland, Marie
    Date: 2016–01
  5. By: Mohajeryami, Saeed; Jennings, Ronald; Alkhbbaz, Ghadeer
    Abstract: This paper sheds light on distributed generation (DG) and energy storage and their impacts on electricity distribution networks. The purpose is to consider the various technologies of DG and energy storage and their financial and dynamic influence on the distribution network performance. In this paper, some different business cases in the U.S. related to energy storage and DG are investigated. One of these cases is related to Hawaiian Electric CO. One of the goals of Hawaiian Electric Co. for 2030 is to provide at least 65 percent of its electricity from renewable resources and working on providing sufficient energy storage. The company is considering energy storage project proposals on Oahu in order to provide their services by 2017. The paper will provide a look inside the company and how they are managing their existing projects and their future plans.
    Keywords: Distributed Generation (DG); energy storage system; economic analysis
    JEL: Z00
    Date: 2015–05–01
  6. By: Feil, Jan-Henning; Mußhoff, Oliver
    Abstract: This paper develops an agent-based real options model, which is capable of analyzing the investment and disinvestment decisions of heterogeneous competing firms under consideration of tradable output permits. A permit market is integrated into the model in which the firms can trade permits with each other according to their investment or disinvestment behavior for production capacity. The empirical application of the model to the EU dairy sector shows that (changes in) tradable output permit systems can have considerable effects on investments and disinvestments, in particular in markets with a high degree of firm heterogeneity. Amongst others, they can ceteris paribus increase both the willingness to invest and to disinvest especially of the less efficient firms in a market. The results shed new lights on the ongoing public debate about the potential effects of tradable output permit systems on structural change in a sector.
    Keywords: investment and disinvestment,real options,firm heterogeneity,tradable output permits
    Date: 2016
  7. By: Rui Gong; Frank Page
    Abstract: We construct a model of a principal-agent game of network formation (over layered networks) with asymmetric information and we consider the following two questions: (1) Is it possible for the principal to design a mechanism that links the reports of agents about their private information and the set of connections allowed and recommended by the principal via the mechanism in such a way that players truthfully reveal their private information to the principal and follow the recommendations specified by the mechanism. (2) An even more fundamental question we address is whether or not it is possible for the principal to achieve the same outcome (as that achieved via a mechanism and centralized reporting) by instead choosing a profile of sets of allowable ways to connect (here modeled as player—club specific sets - or catalogs - of networks) and then delegating connection choices to each pair of agents. We call this approach to network formation with incomplete information delegated networking and we show, under relatively mild conditions on our game-theoretic model of network formation, that strategic network formation with incomplete information, implemented via a mechanism and centralized reporting, is equivalent to implementation via delegated networking with monitoring.
    Keywords: Incentive compatible multilayered networks; delegated networking principle; delegation principle; bilateral incentive compatibility; mechanism design; catalog games
    JEL: J1 F3 G3
    Date: 2016–02–15
  8. By: Kannika Thampanishvong (Thailand Development Research Institute)
    Keywords: Household Energy Conservation,Experimental Approach, Thailand
    Date: 2016–03
  9. By: Bos J.W.B.; Contreras M.G.; Kleimeier S. (GSBE)
    Abstract: Using banks in the syndicated lending market, we discuss a firm-specific strategy that has been overlooked by the literature, namely, that self-regulated firms pressure other non-self-regulated firms in an attempt to reduce effort asymmetries when collaborating. We develop a framework that shows when such a strategy is likely to be present. This framework is built on the view that the costs and benefits of collaboration are equally shared among self-regulated firms that collaborate. However, when self-regulated firms collaborate with non-self-regulated firms, the effort they exert differs and is not equally shared. In particular, we find that when firms collaborate, self-regulated firms pressure non-self-regulated firms to become self-regulated with the purpose of reducing effort asymmetries, and such a pressure increases with the duration of the collaboration.
    Keywords: Banks; Depository Institutions; Micro Finance Institutions; Mortgages; Transactional Relationships; Contracts and Reputation; Networks;
    JEL: G21 L14
    Date: 2016
  10. By: Raúl A. Ponce-Rodríguez; Charles R. Hankla; Jorge Martinez-Vazquez; Eunice Heredia-Ortiz
    Abstract: As more and more of the world’s states devolve power and resources to sub-national governments, decentralization has emerged as one of the most important global trends of the new century. Yet there is still no consensus concerning the benefits of decentralization and how to design institutions that can realize these benefits. In this paper, we investigate the political conditions under which the decentralization of authority will improve the delivery of public goods. Building off Oates’ “decentralization theorem” to include inter-jurisdictional spillovers, we develop a new theory suggesting that the interaction of democratic decentralization (the popular election of sub-national governments) and party centralization (the power of national party leaders over sub-national office-seekers) will produce the best service delivery outcomes. To test this argument empirically, we develop a new dataset of sub-national political institutions. Our analyses, which examine educational and health service delivery in 135 countries across 30 years, provide support for our theoretical expectations.
    Keywords: decentralization
    JEL: H70 H71 H72 H73 H74 H77
    Date: 2016–04

This nep-reg issue is ©2016 by Natalia Fabra. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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