nep-reg New Economics Papers
on Regulation
Issue of 2020‒04‒20
eleven papers chosen by
Natalia Fabra
Universidad Carlos III de Madrid

  1. The European Union energy transition- key priorities for the next five years By Simone Tagliapietra; Georg Zachmann; Ottmar Edenhofer; Jean-Michel Glachant; Pedro Linares; Andreas Loeschel
  2. Real-time electricity pricing to balance green energy intermittency By Ambec, Stefan; Crampes, Claude
  3. Carbon taxes and trade spillovers within Europe By Saptorshee Kanto Chakraborty; Massimiliano Mazzanti
  4. Zero Pricing Platform Competition By Shekhar, Shiva
  5. Auctions vs. negotiations in vertically related markets By Emanuele Bacchiega; Olivier Bonroy; Emmanuel Petrakis
  6. Cost benchmarking long distance train vs. aircraft: Train tickets should not be more expensive than airline tickets By Brützel, Christoph
  7. The effects of equitability policies on the ZEV market: Evidence from California’s Clean Vehicle Rebate Project By Fuller, Sam; Brown, Austin
  8. The Economic Consequences of Data Privacy Regulation: Empirical Evidence from GDPR By Guy Aridor; Yeon-Koo Che; Tobias Salz
  9. Bridging the Gap Between Evacuations and the Sharing Economy By Wong, Stephen D; Walker, Joan L; Shaheen, Susan A
  10. Uncertain Penalties and Compliance By Marcelo Caffera; Carlos Chávez; Carol Luengo
  11. A Simple Model of Competitive Testing By Ginzburg, Boris

  1. By: Simone Tagliapietra; Georg Zachmann; Ottmar Edenhofer; Jean-Michel Glachant; Pedro Linares; Andreas Loeschel
    Abstract: The issue Over the last decade, the European Union has pursued a proactive climate policy and has integrated a significant amount of renewable technologies – such as solar and wind – into the established energy system. These efforts have proved successful and continuing along this pathway, increasing renewables and improving energy efficiency would not require substantial policy shifts. But the EU now needs a much deeper energy transformation to- i)...
    Date: 2019–07
  2. By: Ambec, Stefan; Crampes, Claude
    Abstract: The presence of consumers able to respond to changes in wholesale electricity prices facilitates the penetration of renewable intermittent sources of energy such as wind or sun power. We investigate how adapting demand to intermittent electricity supply by making consumers price-responsive - thanks to smart meters and home automation appliances - impact the energy mix. We show that it always reduces carbon emissions. Furthermore, when consumers are not too risk-averse, demand response is socially beneficial because the loss from exposing consumers to volatile prices is more than offset by lower production and environmental costs. However, the gain is decreasing when the proportion of reactive consumers increases. Therefore, depending on the costs of the necessary smart hardware, it may be non-optimal to equip the whole population.
    Keywords: electricity; intermittency; renewable dynamic pricing; demand response; smart; meters.
    JEL: D24 D62 Q41 Q42 Q48
    Date: 2020–04
  3. By: Saptorshee Kanto Chakraborty (University of Ferrara, Italy); Massimiliano Mazzanti (University of Ferrara; SEEDS, Italy)
    Abstract: Carbon taxation has been suggested among the market based policies to tackle climate change since the early 90’s, often associated to ecological tax reforms rationales. Before the advent of emission trading in the EU, some countries introduced forms of carbon taxation, which is still used to deal with non EU ETS sectors. Due to this historical evolution of environmental policies over the last decades, in presence of a ‘federal system’ that assigns to EU countries the governance of energy and fiscal issues, an heterogeneous set of country driven carbon/energy policy settings is present, which can determine effects on growth and trade. We investigate the possible existence of asymmetries among the European Carbon area countries reaction to the policy adoption responsible to combat climate change via carbon usage reduction.
    Keywords: carbon taxation, spillovers, trade
    Date: 2020–04
  4. By: Shekhar, Shiva
    Abstract: This article studies competition between different types of ad-funded platforms attracting consumers with free services. Consumers often find advertisements a nuisance on such platforms. We study how under a competitive setting platforms balance the tension between attracting consumers and rent extraction from the advertising side. We propose a flexible yet simple model that studies competition between standard platforms and social media platforms (with same-side network effects). We find that an increase in either positive same-side network effects or an increase in consumer disutility from advertisements leads to a reduction in the number of ads on that platform. When competing platforms merge, consumer side network effects do not impact prices and the number of ads is higher. In a setting where consumers present a negative (congestion) externality on each other, competition fails to protect consumer welfare and behaves erratically. Finally, we present a few extensions and discuss some policy implications.
    Keywords: Social media platforms, platforms, two-sided markets, same side network effects, cross side network effects, advertising.
    JEL: K21 L13 L82 L86
    Date: 2020–03
  5. By: Emanuele Bacchiega; Olivier Bonroy; Emmanuel Petrakis
    Abstract: In a two-tier industry with bottleneck upstream and two downstream firms producing vertically differentiated goods, we identify conditions under which the upstream supplier chooses exclusive or non-exclusive negotiations, or an English auction to sell its essential input. Auctioning off a two-part tariff contract is optimal for the supplier when its bar- gaining power is low and the final goods are not too differentiated. Otherwise, the supplier enters into exclusive or non-exclusive negotiations with the downstream firm(s). Finally, in contrast to previous findings, an auction is never welfare superior to negotiations.
    JEL: D43 L13 L14
    Date: 2020–04
  6. By: Brützel, Christoph
    Abstract: In today's political and media discussion there is an argument that airline tickets should not be cheaper than train tickets as this would foster growth of air traffic hurting the global climate by being the most negative means of transportation with regard to CO2- and other greenhouse gas emissions. Therefore, rail transportation should be subsidized even more, and value added taxes should be reduced so that train tickets might become cheaper to dry out demand for air transportation and by this reduce traffic and its environmental impact. A cost benchmarking of a seat offered in a long-distance train at the example of a GERMAN ICE-2 and an Airbus A320, each operated on the route between Düsseldorf and Berlin shows, that this rationale is based on alternative facts.
    Keywords: Aviation,Airlines,Rail Companies,Long Distance Train,Cost Benchmarking,Short haul Flights,Modal Cost Rail Traffic,Modal Cost Air Traffic
    Date: 2020
  7. By: Fuller, Sam; Brown, Austin
    Keywords: Law
    Date: 2020–04–01
  8. By: Guy Aridor; Yeon-Koo Che; Tobias Salz
    Abstract: This paper studies the effects of the EU’s General Data Protection Regulation (GDPR) on the ability of firms to collect consumer data, identify consumers over time, accrue revenue via online advertising, and predict their behavior. Utilizing a novel dataset by an intermediary that spans much of the online travel industry, we perform a difference-in-differences analysis that exploits the geographic reach of GDPR. We find a 12.5% drop in the intermediary-observed consumers as a result of the new opt-in requirement of GDPR. At the same time, the remaining consumers are observable for a longer period of time. We provide evidence that this pattern is consistent with the hypothesis that privacy-conscious consumers substitute away from less efficient privacy protection (e.g, cookie deletion) to explicit opt out, a process that would reduce the number of artificially short consumer histories. Further in keeping with this hypothesis, we observe that the average value of the remaining consumers to advertisers has increased, offsetting most of the losses from consumers that opt out. Finally, we find that the ability to predict consumer behavior by the intermediary’s proprietary machine learning algorithm does not significantly worsen as a result of the changes induced by GDPR. Our results highlight the externalities that consumer privacy decisions have both on other consumers and for firms.
    JEL: L0 L5 L81
    Date: 2020–03
  9. By: Wong, Stephen D; Walker, Joan L; Shaheen, Susan A
    Keywords: Engineering
    Date: 2020–04–13
  10. By: Marcelo Caffera; Carlos Chávez; Carol Luengo
    Abstract: We present the results of a series of laboratory economic experiments designed to study compliance behavior of polluting firms when information on the penalty is uncertain. The experiments consist of a regulatory environment in which university students face emission standards and an enforcement mechanism composed of audit probabilities and penalties (conditional on detection of a violation). We examine how uncertainty on the penalty affects the compliance decision and the extent of violation under two enforcement levels: one in which the regulator induces perfect compliance and another one in which it does not. Our results suggest that in the first case, uncertain penalties increase the extent of the violations of those firms with higher marginal benefits. When enforcement is not sufficient to induce compliance, the uncertain penalties do not have any statistically significant effect on compliance behavior. Overall, the results suggest that a cost-effective design of emission standards should consider including public and complete information on the penalties for violations.
    Keywords: uncertainty, penalty, emission standard, economic experiment
    JEL: C91 L51 Q58 K42
    Date: 2019
  11. By: Ginzburg, Boris
    Abstract: A number of candidates are competing for a prize. Each candidate is privately informed about his type. The decision-maker who allocates the prize wants to give it to the candidate with the highest type. Each candidate can take a test that reveals his type at a cost. I show that an increase in competition increases information revelation when the cost is high, and reduces it when the cost is low. Nevertheless, the decision-maker always benefits from greater competition. Candidates can be better off if the cost is higher. Mandatory disclosure is Pareto-dominated by voluntary disclosure unless competition is low. Finally, when the test is noisier, candidates are more likely to take it.
    Keywords: information disclosure, testing, competition
    JEL: D82 D83
    Date: 2019–01–03

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