The new long-term trend in the price of natural gas

A significant negative trend in the long-term price of natural gas at the wellhead is revealed from simulations with a partial equilibrium model of the industry in the United States. The model framework consists of a simultaneous equations system for production from reserves and for demands for production in the residential, commercial and industrial sectors. We utilize a wide range of historical data to calibrate the model and then develop two sets of scenarios for future prices, one based on further industry development under current regulation, and the other based on deregulation and development of an open market for gas services. The key variables — price of natural gas, level of production and inground gas reserves — for the next 10 years improve for the consumer whether or not there is deregulation but the second scenario leaves the consumer better off sooner.     

Downstream gas pricing in an era of upstream deregulation

State public service commission regulation of gas utility pricing is examined during the period of wellhead price deregulation. A model which incorporates asymmetry in price setting during a period of changing input costs is estimated. Statistical analyses suggest public service commission regulation slowed the increase in gas utility prices during periods of rising costs. Gas utility pricing was not monitored as closely when purchased gas prices fell, thereby altering the rate structure in favor of industrial customers. Federal Energy Regulatory Commission policies designed to promote competition by restructuring the transmission sector of the gas industry after 1985 appear to have suppressed retail prices in industrial markets.     

Economic determinants of deregulation in the gas distribution market

Many state public commissions have deregulated their utility markets. However, evidence of welfare or efficiency improvements under deregulation is ambiguous. It is also unclear why different states adopt consumer choice, price caps, sliding-scale plans, or retain rate-of-return regulation. This study evaluates several economic factors behind deregulation in gas distribution markets using a survey of state commissions. Logistic and hazard models show that utilities’ prices and capacity, and states’ stock of own gas wells, prices of competing fuels and the regulatory climate, help explain the pattern of deregulation. Demonstration effects from surrounding markets also contribute. These factors make the propensity to use price caps versus restructuring vary regionally.     

The impact of restructuring and deregulation on gas rates

This article evaluates the impact of consumer choice programs, price caps, and sliding scale plans on consumer prices of gas using a custom survey of public service commissions and data from the Department of Energy. A seemingly unrelated regressions model estimates residential, commercial and industrial prices jointly, controlling for potentially endogenous demand. Consumer choice programs are estimated to lower residential and commercial prices significantly, by bringing competition to markets with smaller consumers. Prices fall even before deregulation as utilities build consumer loyalty and fight competition. Sliding scale plans are estimated to lower prices of small consumers while raising industrial prices. Price caps lead to overall higher prices, with unclear ranking across consumer classes.      

Consumer Self-Generation and Monopoly Limit-Pricing under Timing Uncertainty of Deregulation in the Electricity Market

Due to uncertainty in the timing of deregulation for electric power generation, large and potentially self-generating consumers should consider a lost option value as part of the cost of any investment they consider. This paper uses a simple two-period model to analyze the role played by the timing anticipation of deregulation in the decision making of potential self-generators (PSGs) and for limit-contract pricing of local utilities. We develop an effective limit-pricing rule and conclude that a higher-probability of early deregulation will lead utilities to retain more consumers and to set higher limit prices before deregulation. A possible early deregulation might not harm utilities; it could even benefit utilities in finite lifetime periods. Finally, a simulation is provided which supports our main results and shows that the effects on utilities' expected profits of uncertainty about the coming deregulation will depend on the distribution of consumer types.     

资源税的价格效应分析

2011年11月1日实施的资源税改革将原油和天然气由原来的从量计征改为从价计征,税率均为销售额的5％-10％,其他的资源税税日依旧是从量计征。这次的资源税改革使社会上普遍关注资源税税改后导致的资源性产品价格上涨．进而对居民消费价格指数CPI产生很大压力。文章采用实证分析方法分析资源税是否会严重影响CPI,研究结果表明资源税对CPI影响不大。     

资源价格及其走势与影响的分析

未来资源价格的大幅上涨态势,对资源产品价格和发展中国家贸易条件、经济安全、经济增长方式转变,价格总水平稳定构成多方面重大影响.应对资源价格上涨成为发展的关键.资源价格是虚拟价格,有多种价格形式和定价方法,因此应对资源价格上涨虽然可以采取多种措施,但最重要的还是价格措施.     

双参考价格范围的价格判断试验研究

传统的价格判断模型考虑常规目标价格状态的判断,然而在不规范的市场中,商品良莠不齐,消费者常常面对超低的商品价格,按照传统的价格判断模型,消费者不会接受这种超低价,然而现实情况却不是如此。消费者为什么接受了怀疑的交易,面对超低价格,消费者如何判断价格的吸引力?笔者将对传统价格模型进行扩展,通过试验验证新的价格判断模型,用以解释以上问题。     

基于可计算一般均衡模型的能源价格变动对新疆经济的影响

基于通用可计算一般均衡(CGE)平台,探讨了能源价格变动对新疆地区宏观经济的影响。模拟结果显示:(1)煤炭价格和天然气价格分别上涨10%以后,新疆地区的GDP、各部门的产出和居民消费变动不大,说明提高煤炭和天然气价格不会对新疆经济造成大的波动,未来新疆地区能源价格改革应从煤炭和天然气入手。(2)油价上涨10%后,新疆地区部门产出和居民消费变化较大,因此未来新疆地区在提高油价时应考虑社会稳定,避免产生大的经济波动。值得注意的是提高油价后,城乡收入差距缩小。总体来说提高油价所产生的影响是积极的。     

A model of fashions and status

This paper presents a model of fashion cycles based on the idea that individuals purchase fashion goods because their displayed status increases with the personal status of other consumers who buy the same good. Fashion cycles occur in the model because demand now is a rising function of future prices: if future prices are high, only rich consumers will buy it in the future and the good will have a higher status value in the future and will be more desirable now, even though demand now is a decreasing function of current price. The time inconsistency problem is solved by repeated cycles which allows for reputation building. The crucial assumption made is that there is perfect information about the price path of all firms and the average status of the purchasers of each product. This limits possible profits in fashion markets in competition as imitation of price paths is then possible.     

The Emergence of Structural Faults on the Supply Side in Deregulated 'Energy Only' Electricity Markets

This article examines the effect of plant entry and exit in a deregulated ‘energy only’ electricity market. A partial equilibrium framework is presented that determines the optimal portfolio of base, intermediate and peaking plant for a given electricity load curve. An optimal result for Queensland is compared against the actual plant stock. Analysis of the portfolio indicates that deregulation is failing a key objective, namely enhancing dynamic efficiency, because too much base plant has been delivered. The research presents scenarios of structural corrections, using the theory of the generalised war of attrition to develop the cases. Results from simulation experiments are clear—consumers will secure lower electricity prices in the short run. But oversupply of base plant may suppress prices to such an extent that they fail to signal timely entry of peaking plant—the consequence of this failure being eventual price shocks and, potentially, load shedding.     

On non-ergodic asset prices

We investigate the asset prices dynamics and the long-run market shares of two competing financial mediators who are selected by consumers. We demonstrate that the social interaction among consumers constitutes an endogenous path-depending source of risk in a financial market. Depending on consumers’ evaluation of the mediator’s investment, asset prices may behave in a non-ergodic manner: the price process converges in distribution but the limiting distribution is not necessarily uniquely determined, its multiplicity being characterized by the multiplicity of possible long-run market shares. The convergence of the process is sensitive to initial conditions and depends on the history of noise-trader transactions. Long-run portfolio holdings may be in-efficient since investors holding mean-variance efficient portfolios may not be identified.     

Price dispersion in oligopoly

In the world of perfect markets consumers are assumed to respond instantly to every small price change. However, in the real world it is not clear that any small price change will have a great impact on consumers' decisions and that, regardless of their habit, they will shift from one brand to the other. The purpose of this paper is to examine oligopolistic price competition under the assumption that consumers are non-responsive to small price differences. The paper proves the existence of equilibrium in which firms do not necessarily charge the same price; however some of the firms charge their monopolistic price and others charge prices close to that price.     

The distribution of demand, market structure, and investment in technology

In a quality-ladder growth model, the dispersion in the demand for quality influences the prices innovators may charge for their innovations and the number of such firms that may obtain market shares at any one time. Under a more dispersed distribution, the innovator may only charge a lower price to cover the entire market. The payoff to innovation declines, causing investment to fall. When the dispersion has reached a critical level, the innovator will no longer price out the incumbents, turning the market into a natural oligopoly with firms selling different grades co-existing at any one time, even if it is optimal for all consumers to buy the highest grade available. Any further increases in dispersion raise the payoff to innovation, inducing greater investment.     

ARE THERE ADVERSE INFLATION EFFECTS ASSOCIATED WITH NATURAL GAS DECONTROL?

The Natural Gas Policy Act (NGPA) will decontrol gas prices in 1985, and there is concern about its inflation and output effects. In this investigation of these concerns, two misapprehensions are remedied. First, inflation is primarily a monetary phenomenon so that a rise in energy prices affects the price level, but any impact on inflation is temporary. Second, while analyses of NGPA have assumed that the price of gas will achieve parity with petroleum, they have neglected decontrol's effect on OPEC's optimal price, Our estimates of the decontrol effect demonstrate that energy prices will fall, not rise     

Can a decline in search cost increase prices?

This paper provides a new explanation of why a decline in consumers’ price search cost may not lead to lower prices. In a duopoly with price competition, I show that when some consumers are captive to one firm, there may be a non‐monotonic relationship between search cost and market power; firms may charge high prices with higher probability and the average price charged may be higher when consumers’ price search cost falls below a critical level. Furthermore, when firms have asymmetric captive segments, expected prices charged by each firm may move in opposite directions as search cost declines.     

THE IMPACT OF UTILITY DEREGULATION IN ARIZONA

This analysis assesses Arizona's short-run price response to utility energy deregulation in the commercial and industrial sectors and the long-term response to deregulated industrial utility prices. Using a standard utility industry approach, ordinary least squares regression confirms commercial/industrial utility prices remain inelastic and Arizona's deregulation efforts have not effectively promoted short-run price competition. Moreover, widening differences in utility rates could be a response to a stronger long-run price elastic effect across states. The findings suggest states not aggressively deregulating utility price to narrow artificial comparative price advantages could be at a competitive disadvantage for interstate manufacturing investment. ( JEL Q41, Q48, Q40)     

An analysis of asymmetric demand response to price changes: The case of local telephone calls

Asymmetric demand responses to price changes are not an observable implication of classical demand theory, which predicts that consumers will react to a small price increase in much the same way as they do to a small price decrease. Yet applied researchers have long speculated that consumers are more sensitive to price increases than they are to price decreases. In addition, recent empirical studies generally support the theory of asymmetric demand responses. We construct a dynamic model based on data gathered from monthly telephone bills for 128 New York Telephone customers over a five-year period. Our results support the conclusion that customers react more quickly and strongly when prices go up than they do when prices go down.We would like to thank Manny Haas and Bernie Reddy for their comments and suggestions.     

Price mimicking under cost-of-service regulation: the Swedish water sector

This study provides an empirical test of price mimicking among publicly owned water utilities. Using a fixed effects spatial Durbin model with data from Swedish municipalities during 2002–2012, I estimate the elasticity of the own relative to neighbors’ average price to 0.14. This behavior can be explained in terms of an informal yardstick competition: when consumers use neighboring municipalities’ prices as benchmarks for costs or as behaviorally based reference prices, policy makers will face the risk of consumer complaints and reduced voter support if deviating too much from neighboring municipalities’ prices. Further, I find some evidence that price mimicking is more pronounced in municipalities where voter support for the ruling coalition is weak.     

Price search and spatial competition

In this paper we study a model where two spatially scattered sellers face a population of consumers dispersed over a given geographical area; they have to incur a transaction cost to place their purchase order. Moreover these consumers have imperfect knowledge of prices, but obtain full information about prices at the first shop they solicit. We study price competition between these firms. The main outcomes of our analysis are as follows. First we show that whenever a price equilibrium exists for given locations of firms, it will necessarily display price dispersion. Second we study location configurations which ensure the existence of a price equilibrium. Furthermore we show that when it exists, a price equilibrium is unique. Finally we analyze firms revenues when merchants anticipate the consequences of their locational choice on subsequent price competition. Then we find that there is an incentive for a firm to get as close as possible to its competitor.