Page 1 of 2
Results
- 23 Jan 2018
- Working Paper Summaries
Transaction Costs and the Duration of Contracts
by Alexander MacKay
When buyers transact with sellers, they select not only whom to transact with but also for how long. This paper develops a model of optimal contract duration arising from underlying supply costs and transaction costs. The model allows for the quantification of transaction costs, which are often unobserved, and the impact of these costs on welfare.
The Long-Run Dynamics of Electricity Demand: Evidence from Municipal Aggregation
This study provides the first quasi-experimental estimate of the long-run elasticity (responsiveness) of residential electricity demand, and finds that it is about double the short-run elasticity. Our findings highlight the importance of accounting for consumption dynamics when evaluating energy policy.