Lynne Kiesling and I have an article in the Fall 2017 Regulation magazine asserting “the need for electricity retail market reforms” (PDF). Our general theme is, as the subtitle puts it, “An innovative 21st century retail electric power market is within reach, but won’t emerge until we ditch 20th century regulations.” We begin: School budgets always seem tight, so …
Soon after Energy Secretary Rick Perry requested DOE staff to prepare a report on how public policies affected the electric power grid, lobbyists for the wind energy and solar energy industries struck back. In an op-ed appearing in The Hill, Megan Hansen and I identify why we think the renewable power industries are so sensitive …
Lobbyists for Wind and Solar Energy Ready to Fight Doe Grid Policy Study Read More »
Mylan’s price increase of the EpiPen in late August has caused consternation and a lot of debate about the reasons why Mylan has been able to increase the EpiPen price so dramatically above its production cost. Don’t forget that production cost includes the time and resources that comprise FDA compliance costs, even for generics like …
Pharmaceuticals and Multi-layered Government-granted Monopoly Read More »
Today in my antitrust and regulation class we talked about natural monopoly theory and what drives the natural monopoly cost structure. A lot of times in practical conversation with regulators and industry we talk about economies of scale, the decrease in average cost of production as the quantity produced increases, as being the main factor …
Cass Sunstein begins: With respect to the past and future of regulation, there are two truly indispensable ideas. Unfortunately, they are in serious tension with one another. Potential solutions lie in three reforms, all connected with democracy itself – but perhaps not quite in the way that most people think. The first indispensable idea is …
Cass Sunstein on Regulatory Analysis and the Knowledge Problem Read More »
Technological change is disruptive, and in the long sweep of human history, that disruption is one of the fundamental sources of economic growth and what Deirdre McCloskey calls the Great Enrichment: In 1800 the average income per person…all over the planet was…an average of $3 a day. Imagine living in present-day Rio or Athens or …
Technological Change, Culture, and a “Social License to Operate” Read More »
Friend of Knowledge Problem Geoff Manne had a thorough opinion piece in Wired yesterday on the FCC’s Title II Internet designation. Well worth reading. From the “be careful what you wish for” department: Title II (which, recall, is the basis for the catch-all) applies to all “telecommunications services”—not just ISPs. Now, every time an internet …
As the consequences of the FCC vote to classify the Internet as a Title II service start to sink in, here are a couple of good commentaries you may not have seen. Jeffrey Tucker’s political economy analysis of the Title II vote as a power grab is one of the best overall analyses of the …
For the firms in regulated industries, for the regulators, for their customers, does the theory underlying the applied regulation matter? I think it matters a lot, even down in the real-world trenches of doing regulation, because regulation’s theoretical foundation influences what regulators and firms do and how they do it. Think about a traditional regulated …
Why Does a Theory of Competition Matter for Electricity Regulation? Read More »
Unless you follow the electricity industry you may not be aware of the past year’s discussion of the impending “utility death spiral”, ably summarized in this Clean Energy Group post: There have been several reports out recently predicting that solar + storage systems will soon reach cost parity with grid-purchased electricity, thus presenting the first …
The “Utility Death Spiral”: The Utility As a Regulatory Creation Read More »
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