Conventional wisdom has it that inventory investment destabilizes the economy be-cause it is procyclical to sales. Khan and Thomas (2007) show that the conventional wisdom is wrong in a general equilibrium (S,s) model with capital. We argue that their finding is not robust - the conventional...

The 2018 SAM for Germany comprises of 160 accounts including 63 activities, 85 commodities, margins, labor, capital, household, government, social contributions, taxes on products, activity tax, direct tax, stock change, savings and investment and the rest of the world. It is entirely based on...

Capacity Remuneration Mechanisms (CRM) can be used in power markets to overtake market failures, reaching security of supply. However, investment in capacity is a dynamic process, that depends on the evolution of prices and costs overtime. In our paper we study the capacity remuneration value...

This paper develops a dynamic model of competitive equilibrium in electricity markets with thermal, hydro and intermittent power sources. Thermal generators have positive and increasing costs and use a marketable input. Hydro generators use a free and uncertain input, but one that is storable....

We analyze the optimal investment strategy of a monopolist which has subscribed a concession contract to provide a public utility, i.e. water service. We present a strategic model in which a monopolist chooses both the timing of the investment and the capacity. We focus not only on the value of...

Assessing the economic consequences of sustainable production choices aimed at reducing environmental negative externalities is crucial for policy making, in light of the increasing interest and awareness experienced in the recent EU policy packages (Circular Economy package; European Green Deal...