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Ciclo seminarios CEA – MIPP

13:00 horas, Sala Asamblea, 4to piso, Torre Ingeniería Industrial (Beauchef 851, Santiago)

El Centro de Economía Aplicada (CEA) y el Instituto Milenio para la Investigación en Imperfecciones de Mercado y Políticas Públicas (MIPP) de la Universidad de Chile invitan a su ciclo de seminarios programados para el primer semestre del año.

Invitada: Claire Lim, Cornell University

Título de la presentación: “Dynamic Natural Monopoly Regulation: Time Inconsistency, Moral Hazard, and Political Environments”

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Abstract
This paper quantitatively assesses time inconsistency, moral hazard and political ideology in monopoly regulation of electricity distribution. We specify and estimate a dynamic model of utility regulation featuring investment and moral hazard. We find under-investment in electricity distribution capital aiming to reduce power outages, and use the estimated model to quantify the value of regulatory commitment in inducing greater investment. Furthermore, more conservative political environments grant higher regulated returns, but have higher rates of electricity loss. Using the estimated model, we quantify how conservative regulators thus mitigate welfare losses due to time inconsistency, but worsen losses from moral hazard.

Más información: Olga Barrera / obarrera@dii.uchile.cl