Lectures Shot course DEFAP 2015
Topic 1
Introduction to electricity markets: general topics of market architecture and the actual implementation
Designing electricity auctions
The Italian electricity auctions
The history of ENEL and the Italian electricity industry
Topic 2
The private value auction model under different payment rules
Bidding behavior and equilibrium results
Topic 3
Extensions of the basic model: multi-object auctions, bid shading results, failure of revenue equivalence.
Topic 4
Theoretical models of multi-unit auctions for electricity markets
References
Auctions in general: Elmar Wolfstetter,
Topics in Microeconomics, CUP 2002, chapter 8. You will find the .pdf on theweb.
Multi-unit (share auctions): Wilson (1979), "Auctions of shares", The Quarterly Journal of Economics, 93(4), pp. 675-689.
Supply functions equilibrium: Klemperer and Meyer (1989), "Supply Function Equilibria in Oligopoly under Uncertainty", Econometrica, 57(6), pp. 1243-1277.
Empirical analisys of auction: Ali Hortacsu, “Recent progress in the empirical analysis of multi-unit auctions”,
InternationalJournal of Industrial Organization, 29(2011) 245-349.