Price Regulations in a Multi-unit Uniform Price Auction

Publikation: Bidrag til konferencePaperForskningpeer review

Resumé

Inspired by recent regulations in the New York ICAP market we examine the effect of different price regulations on a multi-unit uniform price auction. We investigate a bid cap and a bid foor. Given suffciently high total capacities general bid caps always ensure that the market price does not exceed the price cap whereas a selective bid cap for only the larger firms, does not guarantee this outcome. A sufficiently high bid floor always destroys pure strategy equilibria with equilibrium prices above the marginal costs, no matter whether the floor applies to all or only to relatively small firms.
Inspired by recent regulations in the New York ICAP market we examine the effect of different price regulations on a multi-unit uniform price auction. We investigate a bid cap and a bid foor. Given suffciently high total capacities general bid caps always ensure that the market price does not exceed the price cap whereas a selective bid cap for only the larger firms, does not guarantee this outcome. A sufficiently high bid floor always destroys pure strategy equilibria with equilibrium prices above the marginal costs, no matter whether the floor applies to all or only to relatively small firms.

Konference

KonferenceBerlin Conference on Energy and Electricity Economics 2015
LokationDIW Berlin, Schumpeter Hall
LandTyskland
ByBerlin
Periode28/05/201529/05/2015
Internetadresse

Bibliografisk note

CBS Bibliotek har ikke adgang til materialet

Emneord

  • Electricity
  • Capacity markets
  • Price regulation

Citer dette

Boom, A. (2015). Price Regulations in a Multi-unit Uniform Price Auction. Afhandling præsenteret på Berlin Conference on Energy and Electricity Economics 2015, Berlin, Tyskland.
Boom, Anette. / Price Regulations in a Multi-unit Uniform Price Auction. Afhandling præsenteret på Berlin Conference on Energy and Electricity Economics 2015, Berlin, Tyskland.32 s.
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Boom, A 2015, 'Price Regulations in a Multi-unit Uniform Price Auction' Paper fremlagt ved Berlin Conference on Energy and Electricity Economics 2015, Berlin, Tyskland, 28/05/2015 - 29/05/2015, .

Price Regulations in a Multi-unit Uniform Price Auction. / Boom, Anette.

2015. Afhandling præsenteret på Berlin Conference on Energy and Electricity Economics 2015, Berlin, Tyskland.

Publikation: Bidrag til konferencePaperForskningpeer review

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Y1 - 2015

N2 - Inspired by recent regulations in the New York ICAP market we examine the effect of different price regulations on a multi-unit uniform price auction. We investigate a bid cap and a bid foor. Given suffciently high total capacities general bid caps always ensure that the market price does not exceed the price cap whereas a selective bid cap for only the larger firms, does not guarantee this outcome. A sufficiently high bid floor always destroys pure strategy equilibria with equilibrium prices above the marginal costs, no matter whether the floor applies to all or only to relatively small firms.

AB - Inspired by recent regulations in the New York ICAP market we examine the effect of different price regulations on a multi-unit uniform price auction. We investigate a bid cap and a bid foor. Given suffciently high total capacities general bid caps always ensure that the market price does not exceed the price cap whereas a selective bid cap for only the larger firms, does not guarantee this outcome. A sufficiently high bid floor always destroys pure strategy equilibria with equilibrium prices above the marginal costs, no matter whether the floor applies to all or only to relatively small firms.

KW - Electricity

KW - Capacity markets

KW - Price regulation

KW - Electricity

KW - Capacity markets

KW - Price regulation

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Boom A. Price Regulations in a Multi-unit Uniform Price Auction. 2015. Afhandling præsenteret på Berlin Conference on Energy and Electricity Economics 2015, Berlin, Tyskland.