A small region has a high cost monopolistic electricity generator. It is connected through a low capacity transmission line with a large, competitive low cost region. Access to the transmission line is auctioned. I show that, if consumers arbitrate on the regional price differences, the...

A monopolist supplies a homogenous good to two geographically separated markets. Production costs and demand conditions are di?erent in each market. A line with a limited transport capacity connects both markets. The paper compares two institutional frameworks: (1) exclusive access to the line...

Both sides of a two-sided market are usually modeled as markets without product differentiation. Often however,it will be profit maximizing to differentiate one or two sides in two or more types. In a simple theoretical model,inspired by Yellow Pages,we show that this decision crucially depends...

This paper introduces strategic behavior of the electricity network operator in a congested network with imperfect competition for generation. It models a two stage Stackelberg game. First, the network operator sets transmission prices, then generators set output and sales. Several scenarios for...

Abstract: This paper derives the socially optimal transmission prices in a congested electricity network when there is imperfect competition in generation, and when the budget constraint of the network operator is binding. The results which we derive are a generalization of the standard Ramsey...

In Flanders (Belgium), distribution companies are to a large extent owned by the municipalities and as such these municipalities collect an important share of the profits from electricity distribution. This situation (by many it is seen as a hidden tax) cannot be maintained because, in the...

The results obtained by Cardon and Sasaki (1998) on R&D clustering are derived under the specific assumption that firms only can own one patent. When multiple patents are allowed, R&D clustering will come about more frequently if search costs are substantial.

Commodities communicate. Consumers choose a consumption bundle both for its intrinsic characteristics and for what this bundle communicates about their qualities (or .identity.) to spectators. We investigate optimal indirect taxation when consumption choices are motivated by two sorts of...

In this paper we study the taxation of car ownership, car use and public transport in the presence of externalities within the framework of a discrete/continuous choice model. We first derive optimal taxes in a simplified setting, emphasizing the specific role of fixed car ownership taxes and...

The paper analyses the impact of economies of density on the characteristics of an urban transport system under optimal pricing conditions. Optimal pricing rules are derived for a transport system where bus and car modes are available for peak and offpeak trips. Both modes contribute to...