This work represents a first attempt at analyzing the long term coevolution of market structures, technological change and government institutions. An empirical analysis of the U.S. electric power sector was conducted to validate the Grossman and Helpman (1994) "Protection for Sale" framework for use in modeling the interaction between the government and market actors. An agent based model with endogenous technological change was then used to explore how lobbying affects different carbon control policies as they evolve over time. In the empirical analysis, many electric power companies were found to benefit greatly from high carbon prices and can be expected to lobbying for such policies. In fact, in many situations the total near-term profit of the electric power industry increases with a price on carbon. The model was able to correctly identify nine of the top twelve contributing firms based on PAC contributions.
Table of Contents
Model Exploration Methodology
General Modeling Notes
Experimental Design Specifications
Maplight PAC to eGrid Power Plant Owner