Explaining experience curves for LNG liquefaction costs: Competition matter more than learning

Mads Greaker and Eirik Sagen ()

Discussion Papers from Statistics Norway, Research Department

Abstract: In this paper we seek to identify different driving forces behind the fall in LNG liquefaction unit costs. Our focus is on organizational learning including process specific R&D, but we also seek to account for autonomous technological change, scale effects and the effects of upstream competition among liquefaction technology suppliers. To our surprise we find that upstream competition is by far the most important factor. This may have implications for the future development in costs as the effect of increased upstream competition is temporary and likely to weaken a lot sooner than effects from learning and technological change. On the other hand, the increased competition could also spur more innovation, and induce a new drop in future unit costs.

Keywords: Learning curves; Mark-up pricing; LNG costs (search for similar items in EconPapers)
JEL-codes: O31 Q41 Q55 (search for similar items in EconPapers)
Date: 2004-10
New Economics Papers: this item is included in nep-com
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Citations: View citations in EconPapers (3)

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