Market power in water markets
AbstractWe model market power in water markets as multi-market Cournot competition with a river structure. Suppliers are connected through water balances, which imposes resource constraints, and they are connected to heterogeneous water users via a water delivery infrastructure. Our model captures a wide range of specific water market structures. We establish conditions for existence of an equilibrium and we assess the effects of market power on water extraction, delivery, and water prices. Although the monopoly case is similar to standard economic theory, three other specific water market structures illustrate that standard intuition has to be revisited.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Environmental Economics and Management.
Volume (Year): 64 (2012)
Issue (Month): 2 ()
Contact details of provider:
Web page: http://www.elsevier.com/locate/inca/622870
Water markets; Oligopoly; Market power; Cournot–Walras equilibrium;
Other versions of this item:
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
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