Oil Price Indexing Of Natural Gas Prices: An Economic Analysis

Oil price indexing is a peculiar feature of the natural gas markets in Germany and other European countries. It is closely linked to the existence of local monopolies (at least de facto) and of the so called "take-or-pay" (TOP) contracts. After discussing the relation between these features and the motivations for oil price indexing, we formally analyze this strategy in a differentiated good oligoply with a monopolistic supplier of natural gas and competing oil distributors. Starting with a symmetric setting, we first point out how oil price indexing works as a collusive device. In a second step we account for the likely asymmetries between oil and gas distributors. We show that the result obtained under symmetry is not robust and we discuss how the impact of oil price indexing on prices, profits and welfare depends on the form and extent of the asymmetries. -- Die Ölpreisbindung des Erdgaspreises ist ein hervorstechendes Merkmal des Gasmarktes in Deutschland und anderen europäischen Ländern. Diese Besonderheit ist eng verknüpft mit der Existenz lokaler Monopole (trotz Liberalisierung bestehen diese bislang zumindest in Deutschland de facto weiterhin) und sogenannter "take-or-pay" Verträge (TOP contracts), d. h. fixer Abnahmeverpflichtungen zu einem an die Entwicklung des Ölpreises gekoppelten Abnahmepreises. Nach einer Diskussion der Beziehung zwischen diesen drei Besonderheiten des Erdgasmarktes und der möglichen Gründe für die Ölpreisbindung analysieren wir diese Strategie in einem Oligopolmodell mit differenzierten Produkten mit einem monopolistischen Erdgasanbieter und einem oder mehreren konkurrierenden Ölhändlern. Zunächst zeigen wir im Rahmen einer symmetrischen Spezifikation auf, wie die Ölpreisbindung die Kollusion zwischen Erdgas? und Ölanbietern ermöglicht. Anschließend berücksichtigen wir mögliche Asymmetrien zwischen den beiden Energieformen. Dabei zeigt sich, dass das Ergebnis bei Symmetrie nicht robust ist und wir diskutieren im Detail wie die Auswirkung der Ölpreisbindung auf Preise, Gewinne und Wohlfahrt von der Art und vom Ausmaß der Asymmetrien abhängt.Natural gas market,Oligopoly,oil price indexing,Take-or-pay contracts

A sequential semidefinite programming method and an application in passive reduced-order modeling

We consider the solution of nonlinear programs with nonlinear semidefiniteness constraints. The need for an efficient exploitation of the cone of positive semidefinite matrices makes the solution of such nonlinear semidefinite programs more complicated than the solution of standard nonlinear programs. In particular, a suitable symmetrization procedure needs to be chosen for the linearization of the complementarity condition. The choice of the symmetrization procedure can be shifted in a very natural way to certain linear semidefinite subproblems, and can thus be reduced to a well-studied problem. The resulting sequential semidefinite programming (SSP) method is a generalization of the well-known SQP method for standard nonlinear programs. We present a sensitivity result for nonlinear semidefinite programs, and then based on this result, we give a self-contained proof of local quadratic convergence of the SSP method. We also describe a class of nonlinear semidefinite programs that arise in passive reduced-order modeling, and we report results of some numerical experiments with the SSP method applied to problems in that class

Polarized semi-inclusive electroweak structure functions at next-to-leading-order

We present a next-to-leading order (NLO) computation of the full set of polarized and unpolarized electroweak semi-inclusive DIS (SIDIS) structure functions, whose knowledge is crucial for a precise extraction of polarized parton distributions. We focus on the phenomenology of the polarized structure functions for the kinematical conditions that could be reached in an Electron-Ion-Collider. We show that the NLO corrections are sizeable, particularly in the small-$x$ range. We test the sensitivity of these structure functions on certain quark distributions and compare it to the situation of inclusive DIS and electromagnetic SIDIS.Comment: 17 pages, 5 figure

Voltage Stabilization in Microgrids via Quadratic Droop Control

We consider the problem of voltage stability and reactive power balancing in islanded small-scale electrical networks outfitted with DC/AC inverters ("microgrids"). A droop-like voltage feedback controller is proposed which is quadratic in the local voltage magnitude, allowing for the application of circuit-theoretic analysis techniques to the closed-loop system. The operating points of the closed-loop microgrid are in exact correspondence with the solutions of a reduced power flow equation, and we provide explicit solutions and small-signal stability analyses under several static and dynamic load models. Controller optimality is characterized as follows: we show a one-to-one correspondence between the high-voltage equilibrium of the microgrid under quadratic droop control, and the solution of an optimization problem which minimizes a trade-off between reactive power dissipation and voltage deviations. Power sharing performance of the controller is characterized as a function of the controller gains, network topology, and parameters. Perhaps surprisingly, proportional sharing of the total load between inverters is achieved in the low-gain limit, independent of the circuit topology or reactances. All results hold for arbitrary grid topologies, with arbitrary numbers of inverters and loads. Numerical results confirm the robustness of the controller to unmodeled dynamics.Comment: 14 pages, 8 figure

Regional income distribution and human capital formation: A model of intergenerational education transfer in a global context

The demographic problems in developed countries are getting more and more important. Very low fertility rates especially among skilled individuals will soon become relevant for a country's economy. Also of importance is education of children. Since there is an increasing demand for skilled workers, the positive correlation between social background and education worsens the situation. Therefore family planning as well as fertility providing and educational measures are of major importance for regional decision makers. We define in our model the optimal number of children considering the income and education of their parents by using a Cobb-Douglas utility function which implies that children and consumption are complementary goods. Children are considered to be a differentiated good with respect to their education. Therefore, we distinguish between high educated and low educated children. After deciding the optimal number of children, the education level of children has to be determined. We assume that only one parent is responsible for the education. Further we presume a negative correlation between the opportunity costs of educating a child and their parent's qualification. Since we consider the parents income and education, many cases result. Regional policy makers have the possibility to change individual decisions regarding offspring by creating monetary incentives. As wages and therefore family income are exogenous, the regional governments have only two policy measures left: either child allowance and/or scholarships. Considering the population's preferences, regions may optimize the number and structure of children. --population policy,education,qualification,factor proportions,globalization

Global analysis of helicity PDFs: past - present - future

We discuss the current status of the DSSV global analysis of helicity-dependent parton densities. A comparison with recent semi-inclusive DIS data from COMPASS is presented, and constraints on the polarized strangeness density are examined in some detail.Comment: Talk presented at the XIX Int. Workshop on Deep-Inelastic Scattering and Related Subjects (DIS 2011); 4 pages; 2 figure