Optimal access regulation with downstream competition

We analyse access price setting to a bottleneck facility where the fa- cility owner also competes in the deregulated downstream market. We consider a continuum of market structures from Cournot to Bertrand. These market structures are fully characterised by a single parame- ter representing the intensity of competition. We first show how the efficient component pricing rule (ECPR) should be modified as the downstream competitive intensity changes. We then analyse the opti- mal access price where a total-surplus-maximizing regulator trades off production efficiency and pro-competitive effects.


Issue Date:
Mar 29 2012
Publication Type:
Working or Discussion Paper
Record Identifier:
http://ageconsearch.umn.edu/record/151201
PURL Identifier:
http://purl.umn.edu/151201
Total Pages:
22
JEL Codes:
L51
Series Statement:
Risk and Uncertainty Program
R12/2




 Record created 2017-04-01, last modified 2018-01-22

Fulltext:
Download fulltext
PDF

Rate this document:

Rate this document:
1
2
3
 
(Not yet reviewed)