When Does Regulation Distort Costs? Lessons from Fuel Procurement in US Electricity Generation: Comment
American Economic Review
vol. 111,
no. 4, April 2021
(pp. 1356-72)
Abstract
We revisit one of the results in Cicala (2015) and show that the previously estimated large and significant effects of US electricity restructuring on fuel procurement are not robust to the presence of outliers. Using methodologies from the robust statistics literature, we estimate the effect to be less than one-half of the previous estimate and not statistically different from zero. The robust methodology also identifies as outliers the plants owned by a single company whose coal contracts were renegotiated before discussions about restructuring even started.Citation
Han, Jin Soo, Jean-François Houde, Arthur A. van Benthem, and Jose Miguel Abito. 2021. "When Does Regulation Distort Costs? Lessons from Fuel Procurement in US Electricity Generation: Comment." American Economic Review, 111 (4): 1356-72. DOI: 10.1257/aer.20200679Additional Materials
JEL Classification
- D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
- O13 Economic Development: Agriculture; Natural Resources; Energy; Environment; Other Primary Products
- O33 Technological Change: Choices and Consequences; Diffusion Processes
- Q16 Agricultural R&D; Agricultural Technology; Biofuels; Agricultural Extension Services