There are at least two ways of fixing high voltage transmission tolls. One is to regulate them in standard fashion; another is to allocate new transmission lines in competitive auctions to the bidder offering the lowest toll. In this paper we show that expected tolls are considerably lower if...

This paper estimates the residential outage cost in Chile’s Central Interconnected System (SIC), using consumer’s willingness to pay for energy. We first estimate the cost of reducing energy consumption efficiently, that is only the less valuable kWh (as indicated by the market demand curve)...

We compare the cost of generating electricity with coal and wind in Chile. On average, we estimate that the levelized cost of coal, including externalities, is $84/MWh. It is efficient to abate air pollutants (SOx, NOx and PM2.5) but not CO2. With abatement the cost wrought by environmental...

In 1975 Chile implemented an ortodox stabilization program. The fiscal deficit was sharply reduced and monetary policy was tight. However, indexation of wages and the exchange rate to past inflation implied that inflation only gradually declined. In fact,

This paper is an assessment of freight transport regulation in Santiago. We conclude that most regulations restrict quantities and access. Moreover, agents perceive them as erratic and uncertain. We argue that these restrictions are not only costly but a

Energy policy makers usually ignore the response of the demand for electricity to changing prices because they believe that the price elasticity is nil. We show that a “small” price elasticity of demand generates “large” changes in energy shortage probabilities and generation costs when...

Este trabajo estudia formalmente si la ley eléctrica contenía precios suficientes para administrar sin cortes y eficientemente caídas drásticas de la cantidad ofrecida de energía y daba los incentivos correctos para invertir en capacidad de reserva. También analizamos en detalle las...