Competition with Forward Contracts: A Laboratory Analysis Motivated by Electricity Market Design  

Oleh:

Brandts, Jordi ; Pezanis-Christou, Paul ; Schram, Arthur

Jenis: Article from Journal - ilmiah internasional
Dalam koleksi: The Economic Journal (EBSCO) vol. 118 no. 525 (Jan. 2008), page 192-214.
Topik: Competition; Forward Contracts; Electricity Market Design
Fulltext: 192.pdf (301.27KB)

Ketersediaan

Perpustakaan Pusat (Semanggi) Nomor Panggil: EE28.27 Non-tandon: 1 (dapat dipinjam: 0) Tandon: tidak ada

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Isi artikel

We use experiments to study the efficiency effects of adding the possibility of forward contracting to a spot market. We focus on the strategic implications of a forward market and consider both quantity and supply function competition. In both cases we compare the effect of adding a contract market to the introduction of an additional competitor. We find that, as theory suggests, for both types of competition the introduction fo a forward market significantly lowers prices. The combination of supply function competition with a forward market leads to high efficiency levels.

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