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Articles 1 - 8 of 8
Full-Text Articles in Economic Theory
Competitive Auction Markets In British Columbia, Peter Cramton, Susan Athey
Competitive Auction Markets In British Columbia, Peter Cramton, Susan Athey
Peter Cramton
US-Canada Softwood Lumber Trade Dispute, On behalf of British Columbia Ministry of Forests.
A Capacity Market That Makes Sense, Peter Cramton, Steven Stoft
A Capacity Market That Makes Sense, Peter Cramton, Steven Stoft
Peter Cramton
We argue that a capacity market is needed in most restructured electricity markets, and present a design that avoids problems found in the early capacity markets. The proposed market only rewards capacity that contributes to reliability as demonstrated by its performance during hours in which there is a shortage of operating reserves. The capacity price responds to market conditions, increasing when and where capacity is scarce and decreasing to zero when and where it is sufficiently plentiful. Market power in the capacity market is addressed by basing the capacity price on actual capacity, rather than bid capacity, so generators cannot …
Comments On Doc Notice Of Preliminary Results Of Countervailing Duty Review, Peter Cramton, Susan Athey
Comments On Doc Notice Of Preliminary Results Of Countervailing Duty Review, Peter Cramton, Susan Athey
Peter Cramton
US-Canada Softwood Lumber Trade Dispute, On behalf of British Columbia Ministry of Forests.
Financial Development And Financial Liberalization In Asia: Thresholds, Institutions And The Sequence Of Liberalization, Hiro Ito
Economics Faculty Publications and Presentations
I investigate whether financial openness leads to financial development after controlling for the level of legal/institutional development, and whether trade opening is a precondition for financial opening, focusing on Asia. Utilizing a panel encompassing 87 less developed countries over the period 1980 to 2000, I find that a higher level of financial openness spurs equity market development only if a threshold level of legal development has been attained, a condition prevalent particularly among emerging market Asian countries. On the issue of sequencing, trade openness is found to be a prerequisite for successful inducement of financial development via capital account liberalization.
Is Exchange Risk Priced Beyond Intertemporal Risk?, Ines Chaieb, Stefano Mazzoto, Oumar Sy
Is Exchange Risk Priced Beyond Intertemporal Risk?, Ines Chaieb, Stefano Mazzoto, Oumar Sy
Faculty and Research Publications
Recent conditional tests show that exchange risk is priced in integrated international markets. However, these results are typically obtained assuming that intertemporal risk does not matter. We test an intertemporal international asset-pricing model where the investment opportunity set is dynamic. Using a conditional orthogonalization approach, we investigate whether the exchange risk is priced once the market and intertemporal risks are fully taken into account. We find that, in addition to the market and intertemporal risks, the exchange risk is an important determinant of risk premium. We also find that the intertemporal risk, which is often overlooked in the literature, is …
Review Of The Proposed Reserve Markets In New England, Peter Cramton, Hung-Po Chao, Robert Wilson
Review Of The Proposed Reserve Markets In New England, Peter Cramton, Hung-Po Chao, Robert Wilson
Peter Cramton
New England Power Pool, Federal Energy Regulatory Commission.
Review Of The Proposed Reserve Markets In New England, Peter Cramton, Hung-Po Chao, Robert Wilson
Review Of The Proposed Reserve Markets In New England, Peter Cramton, Hung-Po Chao, Robert Wilson
Peter Cramton
ISO New England proposes reserve markets designed to improve the existing forward reserve market and improve pricing during real-time reserve shortages. We support all of the main elements of the proposal. For example, we agree that little is gained by allowing reserve availability bids in the day-ahead market. Doing so greatly increases the complexity of the market without the prospect of more efficient pricing. Rather, offline reserves are most efficiently priced and awarded well in advance, as is done by the improved forward reserve market.
The Micro-Foundations Of Intertemporal Price Discrimination, Winston T. H. Koh
The Micro-Foundations Of Intertemporal Price Discrimination, Winston T. H. Koh
Research Collection School Of Economics
This paper investigates the optimality of intertemporal price discrimination for a durable-good monopoly in a model where infinitely-lived households face an intertemporal budget constraint, and consume both durable goods and non-durable goods. We prove that the optimal price of the durable good is not constant, and may decrease or increase over time. Some households may choose to purchase the durable good at a later date, and pay lower or higher prices, since the gain in discounted utility of consuming more of the non-durable good more than compensates for the loss in utility from delaying the consumption of the durable good.