On dynamic standards for energy efficiency in differentiated duopoly

  • We consider a two-periods-model of differentiated duopoly. Firms produce an en-ergy consuming household durable differentiated by its energy efficiency. Consumers differ by the weight they apply to their future energy costs when deciding which product to buy. In line with the Japanese Top Runner Program, the regulator introduces a minimum efficiency standard in period t=2 which is fixed according to the efficiency of the product supplied by the high efficiency firm in t=1. We show that in t=1 both firms supply lower efficiency products and the high efficiency firm gains in market share and profits. In t=2 these effects are re-versed. Calculated over both periods, total energy consumption does not change. Although there is no ecological effect, total welfare increases because price competition becomes tighter and the cost savings accruing to the consumers exceed the firms’ losses in profits.

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Metadaten
Author:Peter MichaelisORCiDGND, Thomas ZiesemerGND
URN:urn:nbn:de:bvb:384-opus4-710912
Frontdoor URLhttps://opus.bibliothek.uni-augsburg.de/opus4/71091
Series (Serial Number):Volkswirtschaftliche Diskussionsreihe (325)
Publisher:Volkswirtschaftliches Institut, Universität Augsburg
Place of publication:Augsburg
Type:Working Paper
Language:English
Year of first Publication:2015
Publishing Institution:Universität Augsburg
Release Date:2020/02/21
Tag:JEL: L13, Q48, Q58
Pagenumber:20
Note:
Auch erschienen in Journal of Institutional and Theoretical Economics JITE 173(2017), Heft 4 Seite 618 - 642
Institutes:Wirtschaftswissenschaftliche Fakultät
Wirtschaftswissenschaftliche Fakultät / Institut für Volkswirtschaftslehre
Wirtschaftswissenschaftliche Fakultät / Institut für Volkswirtschaftslehre / Lehrstuhl für Umwelt- und Ressourcenökonomie
Dewey Decimal Classification:3 Sozialwissenschaften / 33 Wirtschaft / 330 Wirtschaft
Journals:Volkswirtschaftliche Diskussionsreihe
Licence (German):Deutsches Urheberrecht