markets lead to outcomes (prices and investment) that are not first-best, it even fails to achieve the second-best optimum … given the constraint of time-invariant pricing. We then show that attempts to correct the level of investment through taxes … necessarily reduce capacity investment, and it is likely to harm customers that are already on RTP …

neoclassical growth model. Investment rates and total factor productivity start out low and rise over time. These model dynamics …

, consumption/savings, and portfolio selection. For a lump-sum investment payoff and an agent with a sufficiently strong … precautionary savings motive, an increase in volatility can accelerate investment, contrary to the standard real options analysis …. When the agent can trade the market portfolio to partially hedge against investment risk, the systematic volatility is …

single-carrier plans, while others adopted regimes with at least two carriers. Hence, we also ask whether competition between …

We examine the performance attributes of a merchant transmission investment framework that relies on market driven …' transmission investment to provide the infrastructure to support competitive wholesale markets for electricity. Under a stringent … set of assumptions, the merchant investment model has a remarkable set of attributes that appear to solve the natural …