Assessing Supply Security – A Compound Indicator

28 Pages Posted: 5 Aug 2019

See all articles by Jan Abrell

Jan Abrell

ETH Zürich - Centre for Energy Policy and Economics (CEPE)

Léo Chavaz

University of Basel - Faculty of Business and Economics

Hannes Weigt

WWZ, Wirtschaftswissenschaftliche Fakultät der Universität Basel

Date Written: July 31, 2019

Abstract

Supply security is a prominent and crucial notion which finds application in various economic sectors (energy security, food security, supply chain risks). Yet, it remains particularly difficult to define and measure. Currently used indicators of supply security focus on narrow approaches and offer limited guidance to policy makers. Considering this, we propose a novel indicator assessing the supply security of industries, conceptually or physically, based on a network structure. The indicator is based on a simulation methodology and evaluates the reaction of the market to disruptions of its network services, thereby capturing the various dimensions of supply security. Subsequently, we perform an exemplary application onto the European natural gas market, and evaluate the impact of currently debated network extensions projects and policy measures.

Keywords: Supply Security, Natural Gas, Europe

JEL Classification: L95, Q38, Q40, Q48

Suggested Citation

Abrell, Jan and Chavaz, Léo and Weigt, Hannes, Assessing Supply Security – A Compound Indicator (July 31, 2019). Available at SSRN: https://ssrn.com/abstract=3429536 or http://dx.doi.org/10.2139/ssrn.3429536

Jan Abrell

ETH Zürich - Centre for Energy Policy and Economics (CEPE) ( email )

8092 Zurich
Switzerland

Léo Chavaz

University of Basel - Faculty of Business and Economics ( email )

Petersplatz 1
Basel, 4001
Switzerland

Hannes Weigt (Contact Author)

WWZ, Wirtschaftswissenschaftliche Fakultät der Universität Basel ( email )

Basel, 4051
Switzerland

HOME PAGE: http://fonew.unibas.ch/

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