Consistent Regulation of Infrastructure Businesses: Some Economic Issues

This paper examines some important economic aspects associated with the notion that consistency in the regulation of infrastructure businesses is a desirable feature. It makes two important points. First, it is not easy to measure consistency. In particular, one cannot simply point to different regulatory parameters as evidence of inconsistent regulatory policy. Second, even if one does observe consistency emerging from decisions made by different regulators, it does not necessarily mean that this consistency is desirable. It might be the result, at least partially, of career concerns of regulators.

An Economic Approach to Article 82

This report argues in favour of an economics-based approach to Article 82, in a way similar to the reform of Article 81 and merger control. In particular, we support an effects-based rather than a form-based approach to competition policy. Such an approach focuses on the presence of anti-competitive effects that harm consumers, and is based on the examination of each specific case, based on sound economics and grounded on facts

Human-agent collectives

We live in a world where a host of computer systems, distributed throughout our physical and information environments, are increasingly implicated in our everyday actions. Computer technologies impact all aspects of our lives and our relationship with the digital has fundamentally altered as computers have moved out of the workplace and away from the desktop. Networked computers, tablets, phones and personal devices are now commonplace, as are an increasingly diverse set of digital devices built into the world around us. Data and information is generated at unprecedented speeds and volumes from an increasingly diverse range of sources. It is then combined in unforeseen ways, limited only by human imagination. People’s activities and collaborations are becoming ever more dependent upon and intertwined with this ubiquitous information substrate. As these trends continue apace, it is becoming apparent that many endeavours involve the symbiotic interleaving of humans and computers. Moreover, the emergence of these close-knit partnerships is inducing profound change. Rather than issuing instructions to passive machines that wait until they are asked before doing anything, we will work in tandem with highly inter-connected computational components that act autonomously and intelligently (aka agents). As a consequence, greater attention needs to be given to the balance of control between people and machines. In many situations, humans will be in charge and agents will predominantly act in a supporting role. In other cases, however, the agents will be in control and humans will play the supporting role. We term this emerging class of systems human-agent collectives (HACs) to reflect the close partnership and the flexible social interactions between the humans and the computers. As well as exhibiting increased autonomy, such systems will be inherently open and social. This means the participants will need to continually and flexibly establish and manage a range of social relationships. Thus, depending on the task at hand, different constellations of people, resources, and information will need to come together, operate in a coordinated fashion, and then disband. The openness and presence of many distinct stakeholders means participation will be motivated by a broad range of incentives rather than diktat. This article outlines the key research challenges involved in developing a comprehensive understanding of HACs. To illuminate this agenda, a nascent application in the domain of disaster response is presented

An Economic Approach to Article 82 - Report by the European Advisory Group on Competition Policy

This report argues in favour of an economics-based approach to Article 82, in a way similar to the reform of Article 81 and merger control. In particular, we support an effects-based rather than a form-based approach to competition policy. Such an approach focuses on the presence of anti-competitive effects that harm consumers, and is based on the examination of each specific case, based on sound economics and grounded on facts.Competition Policy; Abuse of Market Power; Article 82

An Economic Approach to Article 82

This report argues in favour of an economics-based approach to Article 82, in a way similar to the reform of Article 81 and merger control. In particular, we support an effects-based rather than a form-based approach to competition policy. Such an approach focuses on the presence of anti-competitive effects that harm consumers, and is based on the examination of each specific case, based on sound economics and grounded on facts.competition policy; abuse of market power

Incentives to Create Jobs: Regional Subsidies, National Trade Policy and Foreign Direct Investment

A national authority wishes to attract foreign direct investment (FDI) to create local jobs. We analyse the optimal national trade policy faced with the possibility that local authorities might offer subsidies to convince a multi-national enterprise (MNE) to invest in their jurisdiction. With centralised decision-making or with allocation of investment to particular localities, the central authority's optimal policy is to use a high tariff to avoid payment of any subsidy to the MNE. Despite this, some socially undesirable (but locally desirable) FDI cannot be avoided. If local authorities compete to offer subsidies to attract local investment, then the central government's optimal policy is to try to discourage FDI by choosing a low tariff. Again, despite this some socially undesirable - and even locally undesirable - FDI prevails. We conduct our analysis both assuming an upper bound on tariffs, as would be consistent with trade liberalisation, and allowing tariffs to vary freely. The effect of this trade liberalisation depends heavily on the system of granting local subsidies: if the system is rather centralised, trade liberalisation decreases the range of parameters for which FDI occurs; if the system is decentralised and competitive, it increases this range

Assessing environmental management in agriculture

This paper incorporates interdisciplinary New Institutional Economics and suggests a holistic framework for assessing the forms and efficiency of environmental management in agriculture. First, it defines environmental management as a specific system of social order regulating behaviour and relations of various agents related to natural environment, and environmental management in agriculture as eco-management associated with agricultural production. Second, it specifies spectrum of modes and mechanisms of eco-management comprising: institutional environment, market, private, collective, public and hybrid. Third, it suggests stages in analysis and improvement of environmental management in agriculture including: identification of problems, and risks associated with natural environment; assessment of efficiency of available and feasible modes, and specifying cases of market, private, and public failures; assessment of comparative efficiency of alternative modes for new public intervention and selection of the most efficient one(s). Forth, it classifies personal, institutional, technological, natural, and transaction costs factors of management choice. Finally, it builds a principle governance matrix with the most effective market, private, and public modes taking into account the critical dimensions of eco-activity and transactions (appropriability, assets specificity, uncertainty and frequency), and their potential to coordinate and stimulate eco-activities, meet preferences and reconcile conflicts of individuals, protect eco-rights and investments, overcome uncertainty and risk, assure socially desirable level of environmental protection, and minimize overall (implementing, third-party and transacting) costs.environmental and natural resources governance; institutions, market, private, public and hybrid modes; agriculture

Internalisation of Transport Noise Externalities: Activity Disturbance Pricing and Implementation

A transport noise-pricing model is developed, which distinguishes between transport sound externalities, real resource costs of transport noise externalities and monetary valuations of such costs. It differs from existing approaches (hedonic pricing and contingent valuation), which aim at monetary valuations directly. The internalisation of transport noise externalities is modelled at the micro-level and allows aggregation across a population to any desired extent. A transport noise externality is characterised for every individual as a set of maps from the space of (non-marketable) transport sound commodities into the set of feasible actions (marketable and non-marketable human activities) such that the set of feasible actions is reduced. The concept of real resource costs to an individual corresponds to the duration of disturbances of optimally chosen human activities and is measured in units of time. Monetary valuations of such costs only require positive personal incomes, irrespective of their source. One example is given of applying a dominant strategy mechanism (Mookherjee and Reichelstein) to the solution of the model, assuming the objective is to select transport service productions which maximise economic profit, appropriate noise measurement technology exists to allow the identification of transport sound sources, and ‘polluter pays’ legislation exists which is costless to enforce.Internalisation of transport noise externalities, incomplete markets, incentive compatible mechanism

Financing Economic Development

We understand that both the level as well as the composition of investment play a crucial role in the economic development process. However, it needs to be understood that investment contributes to the growth process by increasing the productive capacity, improving the technology, and enhancing the competitiveness of an economy. And when it is supplemented with investment in the social sectors, it also results in human development. The demand for investment depends on strong macroeconomic fundamentals comprising stability of exchange rates, fiscal prudence, feasible structure of financial market, including the regulatory and supervisory framework and the size and quality of the securities and bond markets, and continuity of a consistent investment policy.1 Two types of capital formation may be distinguished, viz., physical capital and human capital. Since there are significant differences between private and social profitabilities in the social sectors, an optimal level of investment in human resources would depend on the perception of and the decisions taken by the policy-makers to bridge the gap between the two types of profitabilities. Nevertheless, implementation of an investment decision, whether related to physical or social investment, is contingent on the availability of sufficient domestic and external investible resources.

Turning Up the Heat on Energy Monitoring in the Home

The use of domestic electrical energy monitoring systems is becoming more common however gas usage has received comparatively little attention. This paper presents a new technique for monitoring gas-powered heating and hot water usage in the home integrated into a prototype energy monitoring platform. Compared to usual meter-based approaches this technique provides finer-grained usage data and uses simple temperature sensors. The main motivation for this work is to provide more meaningful energy information to users for inclusion in novel mobile and embedded applications. This is part of ongoing work which aims to reduce energy use among teenagers in the UK and make lasting attitude changes. The development and findings from a prototype deployed in a typical UK house over 7 days are presented. The findings highlight the utility of the technique and simplicity of the sensing approach. The novel requirements that inspired the development of this technique are also presented