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A theory of directional pricing and its application to electricity policy

Author

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  • Akira Maeda
  • Makiko Nagaya

Abstract

This study is a first attempt of investigating a theory of directional pricing. Directional pricing is defined as price or rate designs that apply different prices to selling and buying the concerned goods. A typical example would be rate schedules in the feed-in-tariff (FIT) policy for electricity. This study discusses how the pricing is distinctive and shows that a new development of the theory is essential for the analysis of such emerging electricity markets.

Suggested Citation

  • Akira Maeda & Makiko Nagaya, 2014. "A theory of directional pricing and its application to electricity policy," International Journal of Economics and Business Research, Inderscience Enterprises Ltd, vol. 7(1), pages 1-16.
    • Handle: RePEc:ids:ijecbr:v:7:y:2014:i:1:p:1-16
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