Modeling the strategic trading of electricity assets
Fernando Oliveira (),
Derek W. Bunn and
London Business School
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Derek W. Bunn: London Business School
No 235, Computing in Economics and Finance 2006 from Society for Computational Economics
We analyze how strategic asset trading can be used to gain competitive advantage. In the case of electricity markets, companies seek to improve the value of their generating portfolios by acquiring, or selling, power plants. Accordingly, we derive the basic determinants of plant value, explaining how a particular productive asset may have different values for different firms. From this, we develop an evolutionary model to understand how market structure interacts with strategic asset trading to increase the competitive advantage of firms, and furthermore, how this depends upon the actual price-setting microstructure in the wholesale market itself
Keywords: Competitive advantage; computational learning; auctions; asset trading; simulation; electricity markets (search for similar items in EconPapers)
JEL-codes: C72 C73 L14 L94 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cmp, nep-com, nep-ene, nep-fmk and nep-mst
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Persistent link: https://EconPapers.repec.org/RePEc:sce:scecfa:235
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