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Energy market liberalization and renewable energy policies in OECD countries

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  • Francesco Nicolli
  • Francesco Vona

    () (OFCE - Observatoire français des conjonctures économiques - Sciences Po - Sciences Po)

Abstract

This paper investigates the effect of energy liberalization, compared to other drivers, on policies that support renewable energy in a long panel of OECD countries. We estimate this effect by accounting for the endogeneity of liberalization related to joint decisions within a country's energy strategy. Using regulation in other industries as instruments, we find that energy liberalization increases public support for renewable energy. The effect of liberalization is the second largest after the effect of per-capita income and is mostly driven by reductions in entry barriers, while the effect of privatization is unclear. This finding suggests that a reduction in the monopolistic power of state-owned utilities has a positive effect on renewable energy policies when various types of actors are ensured access to the grid instead of it being provided to only a few large private firms.

Suggested Citation

  • Francesco Nicolli & Francesco Vona, 2019. "Energy market liberalization and renewable energy policies in OECD countries," Post-Print hal-02562707, HAL.
  • Handle: RePEc:hal:journl:hal-02562707
    Note: View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-02562707
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    More about this item

    Keywords

    Renewable energy policy; Energy market liberalization; Instrumental variables; Applied political economy;
    All these keywords.

    JEL classification:

    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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