Browsing by Autor "Alexander Galetovic"

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AN EMPIRICAL EXAMINATION OF PATENT HOLDUP
(Oxford University Press, 2015) Alexander Galetovic; Stephen Haber; Ross Levine
A large theoretical literature asserts that standard-essential patents (SEPs) allow their owners to "hold up" innovation by charging fees that exceed their incremental contribution to a final product. We evaluate two central, interrelated predictions of this SEP holdup hypothesis: (1) SEP-reliant industries should experience more stagnant quality-adjusted prices than non-SEP-reliant industries; and (2) court decisions that reduce the excessive power of SEP holders should accelerate innovation in SEP-reliant industries. We find no empirical support for either prediction. Indeed, SEP-reliant industries have the fastest quality-adjusted price declines in the U.S. economy.
AnatomÃa de la Crisis ElÃ©ctrica
(2001) Carlos Andres Fontanilla Diaz; Alexander Galetovic; Raimundo Soto
This paper studies three issues of the Chilean electricity regulation and their incidence in the energy crisis of 1998-99. Could the price mechanism manage the supply shortage without blackouts? Did the regulation provide incentives to invest in reserve capacity?, and what were the effects of limiting compensations to consumers for blackouts? The model developed shows that the price mechanism is excessively rigid when facing shocks, mostly because outage costs are not contingent prices. In addition, the authorities dismantled the incentives to ameliorate the effects of the crisis when they limited the compensations to consumers, without efficiency gains or higher financial security to generators. Finally, errors in setting nodal prices affect all producers, independently of their thermo-hydroelectric mix. Consequently, even if the probabilities of droughts are biased downwards, firms will adjust optimally investment without hampering security levels.
EL COSTO DE FALLA RESIDENCIAL EN CHILE: UNA ESTIMACION USANDO LA CURVA DE DEMANDA*
(2005) José Miguel Benavente; Alexander Galetovic; Ricardo Sanhueza; Pablo Serra
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) are rationed. Then we estimate the per-kWh cost of rationing by cutting off service. We find that the outage cost varies
La elasticidad de la demanda por electricidad y la política energética
(Fondo de Cultura Económica, 2017) Alexander Galetovic; Cristian Muñoz
En el análisis y la práctica de la política energética se suele suponer que la elasticidad de la demanda por energía eléctrica es irrelevante. Este trabajo muestra que durante episodios de escasez de energía una “pequeña” elasticidad basta para generar caídas “grandes” de la probabilidad de déficit y del costo del abastecimiento eléctrico. Esto se debe a que en la vecindad de la capacidad del sistema, la oferta de energía de corto plazo es cercana a vertical. Ilustramos nuestro punto cuantitativamente simulando la operación esperada del sistema eléctrico chileno durante los años de ajuste a la crisis causada por los cortes de gas argentinos, el periodo 2006-2010. Mostramos que el aumento de los precios causado por el retraso de las inversiones y los cortes de gas argentino, combinado con una “pequeña” elasticidad de la demanda mensual por energía (0.0548 en valor absoluto) eran suficientes para reducir mucho la probabilidad de déficit mensual y retornarla a niveles normales. Más aún, si se soslaya el efecto de los mayores precios en el consumo, el costo marginal se sobreestima en 32% y el costo de operación esperado en 41 por ciento.
LA REGULACION DEL TRANSPORTE DE CARGA EN SANTIAGO: CARACTERISTICAS, EVALUACION Y PROPUESTAS
(Pontifical Catholic University of Chile, 2003) Carlos Barrera-Díaz; Alexander Galetovic; Ricardo Sanhueza
Este trabajo evalúa la regulación del transporte de carga en Santiago. Concluimos que gran parte de las regulaciones restringen cuantitativamente el uso y el acceso a las vías, y que los agentes las perciben como erráticas, lo que genera incertidumbre para la toma de decisiones. Argumentamos que estas restricciones no sólo son costosas sino que también ineficaces, ya que el principal determinante del volumen de carga transportado es el nivel de actividad económica en Santiago, que es en gran medida independiente de las políticas adoptadas para el transporte de carga. Las concesiones urbanas, que serán implementadas próximamente en Santiago, mitigarán algunos de los problemas causados por el transporte de carga. Ellas no sólo aumentarán la oferta de vías sino que también harán que los usuarios paguen la externalidad que generan cuando las utilizan
Privatizing highways in the United States
(2006) Eduardo Engel; Ronald Fischer; Alexander Galetovic
Abstract. We review the experience of both private toll-roads built in the United States during the 1990s, and argue that the problems they encountered could have been avoided if the length of the franchise contract would adapt to demand realizations. We also argue in favor of adjudicating private toll-roads via BOT-type contracts in competitive (Demsetz) auctions. The lessons of this paper are relevant since growing congestion and troubled government finances have made private toll-roads increasingly attractive in the United States.
Privatizing Highways in the United States
(Springer Science+Business Media, 2006) Eduardo Engel; Ronald Fischer; Alexander Galetovic
Renégociation des partenariats public-privé : théorie et données factuelles
(Organization for Economic Cooperation and Development, 2018) Eduardo Engel; Ronald Fischer; Alexander Galetovic
Les partenariats public-privé (PPP) sont des structures de financement complexes qui impliquent d’importants coûts de transaction et nécessitent souvent plusieurs centaines de pages de documentation juridique. Malgré le soin apporté à leur établissement, leur renégociation est monnaie courante, ce qui peut influer sur leur rentabilité. On ignore toutefois si cela tient à l’impossibilité de prévoir tous les cas de figure dans un contrat, ou à des raisons plus prosaïques.
Renegotiations in public-private partnerships: Theory and evidence
(Organization for Economic Cooperation and Development, 2017) Eduardo Engel; Ronald Fischer; Alexander Galetovic
Public-private partnerships (PPPs) have the potential to increase efficiency and improve resource allocation. However, contract renegotiations are common and make us question the benefits of PPPs.
Vertical Integration and Sabotage with a Regulated Bottleneck Monopoly
(De Gruyter, 2009) Álvaro E. Bustos; Alexander Galetovic
Abstract We study the vertical integration and sabotage decisions of a regulated bottleneck monopoly that sells "access" to independent firms and may own a subsidiary downstream. We extend the literature in four directions by: (i) endogenizing vertical integration and linking it with the intensity of vertical economies or diseconomies à la Kaserman and Mayo (1991); (ii) systematically studying how vertical economies and diseconomies affect the intensity of sabotage; (iii) showing that the intensity of sabotage is determined by either a standard Lerner condition augmented by the direct cost of sabotage or a relation between the market share of the subsidiary and the elasticity of the derived demand for access; and (iv) systematically examining the welfare effect of vertical integration.
Vertical Mergers and Competition with a Regulated Bottleneck Monopoly
(De Gruyter, 2009) Alexander Galetovic; Ricardo Sanhueza
Abstract Consider a bottleneck monopoly whose access charge is regulated above marginal cost and produces an essential input used by an oligopoly of downstream firms. Should the monopolist be allowed to vertically integrate into the downstream market? Policy makers often argue that the vertically integrated subsidiary enjoys an undue advantage, because it receives access at marginal cost. We show that there is no undue advantage.With perfect competition downstream vertical integration is irrelevant because the subsidiary substitutes downstream output one-to-one and faces a per-unit opportunity cost equal to the access charge.With an oligopoly consumers and the bottleneck monopoly gain with vertical integration. By contrast, competitors lose oligopolistic rents. Social welfare increases, unless output is redistributed towards a very inefficient vertically integrated firm.