Consequences of path-dependent supply side hysteresis on the market equilibrium are illustrated. Supply is only a subsystem of the entire market with its forcing variable (price) being endogenous from the perspective of the entire market. This results in feedbacks on the equilibrium of price and...

Current EU short-term market designs for electricity face several challenges in (i) securing efficient system operation (ii) unlocking the full potential of flexible resources and (iii) fostering effective use of transmission capacity. For a gradual reform of market design and to guarantee...

A key prediction of a large class of theoretical models is that the location of economic activity is not necessarily determined by fundamentals. To test the empirical relevance of these ideas requires a natural experiment in which a large but ultimately temporary shock dislocates economic...

The present paper reports a repeated experiment on decision making under risk where subjects have to tackle the same choice problems in several rounds. We fit a simple error model and investigate how behavior changes in the course of the experiment. Our analysis complements and extends Hey...