Energy Market Liberalization and Renewable Energy Policies in OECD Countries

IEB Working Paper N. 2014/18

55 Pages Posted: 24 Jul 2014

See all articles by Francesco Vona

Francesco Vona

Observatoire Français des Conjonctures Economiques (OFCE) - Department for Research on Innovation and Competition

Francesco Nicolli

University of Ferrara

Date Written: April 11, 2014

Abstract

We investigate the effect of energy liberalizations on policies that support renewable energy in a long panel of OECD countries. We estimate this effect accounting for the endogeneity of liberalization related to joint decisions within a country’s energy strategy. Using regulation in other industries as instruments, we find that energy liberalization increases the public support to renewable energy. The effect of liberalization is the second largest after the effect of per-capita income and is fully driven by reductions in entry barriers, while the effect of privatization is negative. Finally, our results are robust to dynamic specifications and various policy indicators.

Keywords: renewable energy policy, energy market liberalization, instrumental variables, applied political economy

JEL Classification: Q42, Q48, D72, O38

Suggested Citation

Vona, Francesco and Nicolli, Francesco, Energy Market Liberalization and Renewable Energy Policies in OECD Countries (April 11, 2014). IEB Working Paper N. 2014/18. Available at SSRN: https://ssrn.com/abstract=2471001 or http://dx.doi.org/10.2139/ssrn.2471001

Francesco Vona (Contact Author)

Observatoire Français des Conjonctures Economiques (OFCE) - Department for Research on Innovation and Competition ( email )

250 rue Albert Einstein
Valbonne, 06560
France

HOME PAGE: http://www.ofce.sciences-po.fr/ofce/dric.htm

Francesco Nicolli

University of Ferrara ( email )

C.so Ercole I° d'Este 37
Ferrara, 44100
Italy

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