Neoclassical Theory of Energy Market's Structure Identification

Strelkov M.T., PhD (Engin.)
Language: Russian
Source: The Problems of General Energy, 2000, 1(2):30-35
Section: Systemic studies and complex problems of the energy sector
UDC: 621.311

Abstract:

Elements of the neoclassical theory of energy market's structure identification, based on the introduced conception of the firms rang, have been developed. The basis for the rang constructing is the reduced values of the function arguments of the generalized model of firm behavior. The model takes into consideration two different forms of trade organization -the forward and spot energy markets. The integral matrix model is suggested to define the firm integral characteristics (wage, step) and energy market indexes (heterogeneity monopolization, structure). They make it possible to range firms and to identify market's models. Models of the homogeneous and heterogeneous markets as well as the dominant firm market are defined by using the first order rang firm "market share" subject to balance condition Interconnection between the market structure index and the Herfindahl-Hirschman index is indicated as well as interconnection between the market heterogeneity index and the market concentration index.

Keywords: energy market, firm behavior generalized model, firms rang, market structure matrix, firm wage, firm step, market heterogeneity index, market monopolization index, market structure index, market share, homogeneous market models, heterogeneous market models, market concentration index, Herfindahl-Hirschman index dominant firm market.

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