Vernon Smith has won this year’s Nobel Prize in Economics for his pioneering work in experimental economics. This is outstanding! See the press release from Mercatus for further details. See also my post from yesterday about electricity experiments and demonstrating the benefits of choice. Vernon Smith and his work form part of the foundation of …
In a Philadelphia Inquirer column yesterday, Andrew Cassel said it beautifully: The real shame of Enron isn’t that its top executives got filthy rich off of crooked deals and phony accounting. It’s that the company took a good idea and poisoned it. The good idea is competition, specifically competition in the production and delivery of …
I’ve been reading Steven Pinker lately, and his new book The Blank Slate has just arrived. In The Blank Slate Pinker takes on three “myths”: the blank slate, the noble savage, and the ghost in the machine. I think the implications of his research, and his writing for laypeople, are profound for economics and the …
Experimental Economics and Retail Electricity Deregulation: Demonstrating the Benefits of Choice Regulatory change in electricity moves slowly, in part because of human dislike of change and aversion to risk. Convincing people that regulatory change is worth undertaking would be a lot simpler if we could demonstrate the possible outcomes of a change, and thereby that …
Experimental Economics As an Electricity Policy Tool Read More »
My colleague Adrian Moore and I argue in this policy analysis, published by the Institute for Research on the Economics of Taxation, that the administration’s proposal and the House and Senate versions of the energy bill retain too much government manipulation of markets, and fail to recognize the range of institutional approaches available to address …
The Energy Bills And The Administration’s Proposal Are Static And Backward-looking Read More »
As I argue in this presentation delivered last week at the Ronald Coase Institute Workshop on Institutional Analysis, the bifurcated PX/ISO pool trading structure created a myriad of incentives for both buyers and sellers to behave strategically. Furthermore, because I was making a methodological point to the students, better institutional analysis could have lessened or …
The Consequences Of Failing To Do Sound Economic Institutional Analysis: Read More »
Energy expert and industry veteran Ed Reid and I wrote this article for the Reason publication Privatization Watch. Punch line: distributed generation could go a long way toward helping us deal with energy infrastructure issues (especially transmission construction) in a cost-effective and flexible manner, but intended and unintended government barriers still exist. Here’s the conclusion: …
My friends at the Center for the Advancement of Energy Markets have a superb rebuttal to a Houston Chronicle letter calling for the re-regulation of electricity in Texas. The author of CAEM’s rebuttal, Nat Treadway, has written a clear and thoughtful reponse to this ridiculous idea.
Here’s a great example of the competitive, market process dynamic at work. According to this article, American Electric Power is planning to retire, or mothball, 16 of its older gas-fired plants in Texas. The article says it well: The decision to deactivate the plants is a result of the introduction of electricity deregulation and competition …
I haven’t focused on it much here, but the FERC had set the wholesale “soft price cap” in California to rise from $91.87 to $250 today. As this article reports, the new price cap has been delayed a month to allow officials to incorporate changes from a computer test of manipulation possibilities. Of course, this …
What’s New With The California Wholesale Price Cap? Read More »
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