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Hayekian complexity and the role of regulation in electricity markets
Author(s) -
Oğuz Fuat
Publication year - 2020
Publication title -
economic affairs
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.24
H-Index - 18
eISSN - 1468-0270
pISSN - 0265-0665
DOI - 10.1111/ecaf.12429
Subject(s) - electricity , tariff , monopoly , natural monopoly , economics , electricity system , electricity market , industrial organization , business , market economy , public economics , microeconomics , environmental economics , natural resource economics , electricity generation , engineering , power (physics) , international trade , physics , quantum mechanics , electrical engineering
Utilities worldwide have followed the natural monopoly model for more than a century. This has started to change in recent decades. Electricity systems have become complex, as interactions between participants become multidimensional. This article examines the knowledge problem in an increasingly complex electricity system. I argue that increasing complexity in the electricity system necessitates reconsideration of the regulatory tariff model for utilities.