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ERIC Number: ED516504
Record Type: Non-Journal
Publication Date: 2010
Pages: 103
Abstractor: As Provided
Reference Count: 0
ISBN: ISBN-978-1-1097-7980-6
Electricity Restructuring and Economic Education
Craig, Joseph Dean
ProQuest LLC, Ph.D. Dissertation, University of Colorado at Boulder
My dissertation research concentrates on the causes, motivations, and results of electricity restructuring, and research on the effectiveness of economic teaching and retention. The first chapter looks at motivations for electricity restructuring in the United States in terms of the Interest Group and Public Interest setting. The second chapter investigates results of electricity restructuring in terms of generating efficiency. The final chapter discusses whether exposing undergraduate students to economics outside of a typical classroom setting increases their retention of classroom taught models. For the first chapter of my dissertation we investigate motivations for electricity restructuring in the United States. Beginning in 1992, with the passage of the Energy Policy Act, measures to promote competition were undertaken in the electricity industry. From 1996 to 2002, 18 states followed suit, with restructuring programs targeted at improving efficiency through the use of increased wholesale trading, abolishment of 'cost of service' regulation, measures to open electricity production to non-utility entities, and the unbundling of transmission and distribution. Theory suggests that the initiatives promoted by these states would expose electricity generation to competitive forces that should increase both productive and dynamic efficiency, thus leading to lower comparative energy prices. The purpose of this chapter is to examine whether deregulation was brought about due to the Public Interest theory (that regulatory changes are undertaken to benefit society) or the Interest Group theory (that groups that hope to gain from deregulation lobby for regulatory changes). I focus on the period from 1995-2006 to investigate this question. All 50 states and the District of Columbia are included. The observational unit is the state year. Hazard models are employed to investigate the question. Results indicate no evidence for the public interest theory, and strong evidence of the interest group theory. I find that a stronger presence of industrial customers in terms of MWh purchased by the average customer implying a greater probability of restructuring. A stronger political influence of residential customers also is associated with a greater chance of restructuring; controlling for other variables and residential price, an increase in median income of $1000 (and thus more ability to lobby) increases the probability restructuring of by between eleven and 28 percent. In the second chapter we investigate the effects of market restructuring initiatives that introduced competition into the United States electricity industry on the thermal efficiency of electricity generation. An empirical model is estimated on annual data for over 950 plants from 1996 to 2006. Model estimates show that restructuring increased the efficiency of investor-owned plants by about 13 percent and that these gains stem from organizational and technological changes within the plant. Instrumental variable approaches indicate that estimates may be lower bounds of efficiency gains. Although not directly targeted by restructuring initiatives, I also find similar efficiency effects for municipality-owned plants. This result suggests that the benefits from restructuring have spilled over to public electricity generation. In addition particular attention was paid to the definition of a restructured electricity market, with alternative measure of restructuring employed as robustness checks. Lastly this improvement in efficiency translates into a substantial reduction in carbon emissions equivalent to taking approximately ten million cars off the road in 2006. For the final chapter of my dissertation we look at the effect of having students read and respond to articles regarding economic events on the learning of economic theory in both Intermediate Microeconomics and Intermediate Macroeconomics. We find that having students apply theoretical material to real world situations has spillover effects into the learning of theoretical material itself. By assigning articles and measuring performance on midterm exams in four Intermediate Theory courses during the 2007-08 academic year, results indicate that each additional article a student completed resulted in an improvement of approximately one percentage point on a given midterm exam. This effect grew to three percentage points per article completed on the middle of three midterms where we could ensure that both "finish everything early" students and "procrastinate as long as possible" students were represented. [The dissertation citations contained here are published with the permission of ProQuest LLC. Further reproduction is prohibited without permission. Copies of dissertations may be obtained by Telephone (800) 1-800-521-0600. Web page:]
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Publication Type: Dissertations/Theses - Doctoral Dissertations
Education Level: Higher Education; Postsecondary Education
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: N/A