Price Regulation in a Vertically Integrated Natural Gas Industry: The Case of Mexico
AbstractThe Comisión Reguladora de Energía of Mexico has implemented a netback rule for linking the Mexican natural gas price to the Texas natural gas benchmark price in an industry structure characterized by a vertically integrated state-owned monopoly. This paper shows that in an open economy where agents can choose between gas and alternative fuels, and where the density function describing the distribution of agents along the pipeline can have mass points, the netback rule is Pareto optimal.
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Bibliographic InfoArticle provided by De Gruyter in its journal Review of Network Economics.
Volume (Year): 4 (2005)
Issue (Month): 1 (March)
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Web page: http://www.degruyter.com
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- Meritet, Sophie & Rosellon, Juan & Elizalde, Alberto, 2006. "LNG in the Northwestern Coast of Mexico: Impact on Prices of Natural Gas in Both Sides of the US-Mexico Border," MPRA Paper 21954, University Library of Munich, Germany.
- Rosellon, Juan, 2008. "Policy Research Supporting Policy Making: The CIDE-CRE Agreement," MPRA Paper 22419, University Library of Munich, Germany.
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