Measuring the effects of price controls using mixed complementarity models

Murphy, Frederic H.; Pierru, Axel; Smeers, Yves

doi:10.1016/j.ejor.2018.11.051

Cited by 25 publications

(14 citation statements)

References 20 publications

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Section: Generalization: Expanding the Scope Of Policiesmentioning

confidence: 99%

“…Converting the identification of a policy expressed as a constraint and its implicit cost to the instruments that makes it possible to achieve is a difficult problem. Murphy et al [35] discussed how to solve the reverse problem (computing the Impact of a mix of instruments) through a complementarity problem formulation. Complementarity models extend LP formulations and are now common in energy modeling (see, e.g., Murphy et al [34], a tutorial emphasizing the advantages of the complementarity formulation compared to the optimization model).…”

Section: Generalization: Expanding the Scope Of Policiesmentioning

confidence: 99%

“…Complementarity models extend LP formulations and are now common in energy modeling (see, e.g., Murphy et al [34], a tutorial emphasizing the advantages of the complementarity formulation compared to the optimization model). The method described in [35] has been extensively applied in looking at various aspects of the highly regulated domestic energy prices in Saudi Arabia. The problem can be stated at different degrees of generality.…”

Section: Generalization: Expanding the Scope Of Policiesmentioning

confidence: 99%

See 2 more Smart Citations

The Role of Electrification in the Decarbonization of Central-Western Europe

d'Aertrycke¹,

Smeers

Peufeilhoux³

et al. 2020

Energies

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Scenario studies of energy transition generally point to the central role of electricity. This notion is ambiguous as its interpretation can range from an electricity-only policy to portfolios of different energy vectors with a dominance of electricity. This ambiguity adds to the uncertainty that already pervades today’s investment environment. This paper examines the centrality of electricity through a so-called “variational scenario” analysis with policies obtained by a mix of electricity-only and green gas penetration while maintaining constant decarbonization objectives. Electricity is a complex product that can only be further complicated by the high penetration of renewables and its interaction with the production and use of synthetic fuels. The variational scenario analysis is conducted with sufficiently fine (hourly) granularity to produce an adequate representation of these phenomena. It shows that tilting the central role of electricity to a mix of electricity and green gas offers several advantages in terms of efficiency, flexibility of investment strategies, and robustness with respect to major uncertainties. It shows that the variational scenario analysis can be extended to more complex mixes of policies.

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Section: Generalization: Expanding the Scope Of Policiesmentioning

confidence: 99%

Section: Generalization: Expanding the Scope Of Policiesmentioning

confidence: 99%

Section: Generalization: Expanding the Scope Of Policiesmentioning

confidence: 99%

See 1 more Smart Citation

The Role of Electrification in the Decarbonization of Central-Western Europe

d'Aertrycke¹,

Smeers

Peufeilhoux³

et al. 2020

Energies

Self Cite

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“…The modern micro-founded theory of price controls was developed in part to examine the case of commodity producers in developing countries (Stiglitz and Newbery 1979;Newbery and Stiglitz 1982). More recently, for EMDEs, price controls for petroleum products have been studied extensively, while those on food products have received less attention (Verme and Araar 2017;Kojima 2013;Devarajan 2013;Murphy et al 2019;Shi and Sun 2017;Clements, Jung and Gupta 2007;Ghosh and Whalley 2004). The World Bank's Energy Sector Management Assistance Program (ESMAP) has conducted in-depth studies of subsidy reforms for energy markets across EMDEs (ESMAP 2019;Ore et al 2018).…”

Section: Introductionmentioning

confidence: 99%

Price Controls: Good Intentions, Bad Outcomes

Guenette¹

2020

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The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.

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“…In this paper we describe how to incorporate four basic pricing structures into multi-sector economic problems: the marginal cost (perfect competition), the administered (fixed) price, the average cost price, and a price cap. For a more detailed explanation of how MCP models can be used to measure the effects of price controls, see Murphy et al (2019).…”

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confidence: 99%

Implementing Alternative Pricing Policies in Economic Equilibrium Models Using the Extended Mathematical Programming Framework

Rioux¹,

Jarboua²,

Murphy³

et al. 2020

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is a non-profit global institution dedicated to independent research into energy economics, policy, technology and the environment across all types of energy. KAPSARC's mandate is to advance the understanding of energy challenges and opportunities facing the world today and tomorrow, through unbiased, independent, and high-caliber research for the benefit of society. KAPSARC is located in Riyadh, Saudi Arabia.

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Measuring the effects of price controls using mixed complementarity models

Cited by 25 publications

References 20 publications

The Role of Electrification in the Decarbonization of Central-Western Europe

The Role of Electrification in the Decarbonization of Central-Western Europe

Price Controls: Good Intentions, Bad Outcomes

Implementing Alternative Pricing Policies in Economic Equilibrium Models Using the Extended Mathematical Programming Framework

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