Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/129659
Authors: 
Holmberg, Pär
Wolak, Frank A.
Year of Publication: 
2015
Series/Report no.: 
IFN Working Paper 1099
Abstract: 
We analyse how the market design influences the bidding behaviour in multi-unit auctions, such as wholesale electricity markets. It is shown that competition improves for increased market transparency and we identify circumstances where the auctioneer prefers uniform to discriminatory pricing. We note that political risks could significantly worsen competition in hydro-dominated markets. It would be beneficial for such markets to have clearly defined contingency plans for extreme market situations.
Subjects: 
cost uncertainty
asymmetric information
uniform-price auction
discriminatory pricing
Bertrand game
market transparency
wholesale electricity market
treasury auction
Bayesian Nash equilibria
JEL: 
C72
D43
D44
L13
L94
Document Type: 
Working Paper

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