From Hierarchies to Markets: The Electric Power Industry’s Path to Consumer Welfare
https://doi.org/10.18288/1994-5124-2023-3-46-81
Abstract
The energy crises during 2021 and 2022 in the USA and EU have shown that technological transformation can have negative consequences for the electric power industry by causing power outages and sharp fluctuations in market prices. This prompted the authors to determine the role of institutions in overcoming problems in intra-sectoral coordination. After clustering the electric power industry’s alternatives for institutional organization in different countries using OECD data and Ward's method, the conclusion is that, in addition to economic and technological factors, the characteristics of social orders (as outlined by D. North et al.) influence the choice of a regulatory model. Moreover, after comparing the results of clustering with the dynamics of investment in the industry and of electricity prices, the authors maintain that these factors are significantly correlated with institutional organization. Therefore, management alternatives for ensuring stable electricity prices and incentives for investment in the industry should take into account not only economic and technological factors but also the social order established in the country.
Keywords
electric power industry,
transactions governance mechanisms,
social order,
clustering,
public efficiency
JEL: L22, L42, B52
About the Authors
Aleksandra R. Kolomiyets
Lomonosov Moscow State University
Russian Federation
Russian Federation
Aleksandra R. Kolomiyets, Graduate Student, Lead Economist at the Faculty of Economics,
1, str. 46, Leninskie Gory, Moscow, 119991.
Sergey I. Fedorov
Lomonosov Moscow State University
Russian Federation
Russian Federation
Sergey I. Fedorov, Graduate Student, Assistant to the Chair of Competition and Industrial Policy at Faculty of Economics,
1, str. 46, Leninskie Gory, Moscow, 119991.
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Review
For citations:
Kolomiyets A.R., Fedorov S.I. From Hierarchies to Markets: The Electric Power Industry’s Path to Consumer Welfare. Economic Policy. 2023;18(3):46-81. (In Russ.) https://doi.org/10.18288/1994-5124-2023-3-46-81
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