Three Essays on Applied Mixed Oligopoly Theory and Policy Implications PDF Download

Author: Ali Dadpay
Publisher:
ISBN:
Category : Air traffic control
Languages : en
Pages : 238

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Author:
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ISBN:
Category : Dissertations, Academic
Languages : en
Pages : 688

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Author: Ziyu Guo (Ph. D. in environmental economics)
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Category : Corn products industry
Languages : en
Pages : 0

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This dissertation is composed of three chapters on policy evaluations in oligopoly markets. The first chapter compares effects of two main policies that support renewable energy development in the U.S. electricity market. The feed-in tariff (FIT) policy offers a guaranteed above-market price to renewable electricity firms by providing an extra government payment. The renewable energy certificate (REC) policy relies on the market mechanism. When associated with a renewable portfolio standard, the REC policy can provide a tool that rewards eligible renewable electricity firms financially. Using U.S. data, this chapter examines the effects of these two support policies in two multi-sector dynamic models, incorporating dynamic Nash equilibrium conditions between fossil fuel electricity firms and renewable electricity firms. The FIT policy results in a decline in production in the manufacturing sector and a fast change in consumer consumption behavior. Under the optimal feed-in tariff setting, investment in renewable energy is delayed. On the other hand, the REC policy ends with a stable increase in manufacturing production and household consumption. Green investment remains positive over time under the optimal renewable portfolio standard. The second chapter explores the dynamic impacts of trade policies in the international soybean market. In 2018, China responded to U.S. trade action by imposing a retaliatory tariff on U.S. commodity exports. Among the agricultural trade, soybeans account for the largest amount between United States and China. This chapter evaluates the counterfactual impacts of “Globalization” and “Trade War” on the soybean trade between two exporting countries, U.S. and Brazil, and one importing country, China, in a dynamic game model. This chapter introduces the state-owned enterprise behavior into the model. The results show that firms in U.S. and Brazil result in more soybean exports under the “Globalization” scenario. When there is a trade war between 2018 and 2021, firm in the U.S. exports much fewer soybeans to China because of the high tariff. The storage of the firm rises during the trade war to avoid profit loss. On the other hand, firm in Brazil benefits from the trade war and end up exporting more soybeans to China than usual. Our findings match the data during the trade war period. To explore the impacts of the trade in the international soybean market, we also build up a stochastic model and solve the feedback Nash equilibrium. The results show that firms tend to export more for the next period with higher initial storage levels when taking tariff uncertainty into account. The third chapter investigates the effects of demand shocks in the international corn market. Corn is the largest crop in terms of production and consumption in the United States. We introduce four exporters, U.S., Brazil, Argentina, and Ukraine, in a dynamic competitive storage model to explore the counterfactual effects under Globalization and High sustainability scenarios. We can also predict the impacts of short-term price shocks on the exports and storage in the four exporting countries. We conclude that U.S. and Argentina benefit more under “Globalization” than the other two countries. The change in U.S. ethanol demand induces the firms’ strategic behavior. With an increasing demand, firms stock up corns for future sale at a higher price. With a decreasing demand, firms deplete their stock at the beginning periods to avoid profit loss in future. In addition, the short-term price shock has different effects in four countries. We find that firms in U.S. and Brazil, with relatively higher storage amounts, are more sensitive to the price shock than Argentina and Ukraine, whose storage levels are less than 10% of their exports.

Author: Jae-Woo Lee
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Category : Oligopolies
Languages : en
Pages : 250

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Author: Hyun Jong Kim
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Category : Equilibrium (Economics)
Languages : en
Pages :

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Author: Shyh-Fang Ueng
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Category : Competition
Languages : en
Pages : 118

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This research investigates three issues related to the economic performance of oligopolistic markets where firms produce differentiated products and compete in prices. First of all, this dissertation uses a Markov Perfect Equilibrium approach with fixed periods of commitment of actions to answer the question of what prices a duopolists will charge in equilibrium if they produce horizontally differentiated products, move alternatingly, and compete in prices forever. It is found that firms charge prices which are higher than Nash equilibrium prices but lower than the fully collusive equilibrium prices. Also, contrasted with the Nash equilibrium of the one-shot constituent game, the firm having the significantly higher demand responsiveness to its own price always charges a lower price than the other firm does although it has higher marginal cost. The dissertation then proceeds to study whether a firm can overcome its cost disadvantage by upgrading its product over the rival's, and if so, whether there exists a profit-division which will induce the low cost firm and the high cost firm to collude and no one has an incentive to cheat. The results show that (1) the ability of upgrading the product over the rival's can allow a high cost firm to earn higher profit than a cost advantaged low cost firm; (2) there exists at least one profit-division which can sustain full collusion; and (3) in the collusive equilibrium firms enlarge their quality differences to alleviate the price tension between their products. Finally, this work investigates the welfare effect of mergers which occur in an oligopolistic industry where firms produce differentiated products. It is shown that for the merger to be socially beneficial, the number of the merging firms must be less than the total number of firms in the industry minus the ratio of the products' own elasticity to cross elasticity. The analysis indicates that the welfare effect of a merger of a specific size depends on the substitutability among products of the industry.

Author: Paulo de Freitas Guimaraes
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Category : Economics, Mathematical
Languages : en
Pages : 306

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Author: Jai-June Kim
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Category :
Languages : en
Pages : 262

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Author: Timothy F. Bresnahan
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Category : Automobile industry and trade
Languages : en
Pages : 107

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Author:
Publisher:
ISBN:
Category : Dissertation abstracts
Languages : en
Pages : 776

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