This paper models some reductions in output that may follow the opening of electricity markets to competition. Specifically, we show that vertical separation of electricity generation, transmission and distribution could reduce welfare compared to the previous system of vertically integrated monopoly, if grid owners can act as monopolistic retailers or, alternatively, set access prices that maximize ...
In March 2000, OPEC decided to stabilise oil prices within a range of 22-28 US-Dollar/barrel of crude oil. Such an oil-price-level is far beyond the short and long run marginal costs of oil production, beyond even that in regions with particularly high costs. Nevertheless, OPEC may achieve its goal if world demand for oil increases substantially in the future and oil resources outside the OPEC are ...