Dynamic and strategic behavior in hydropower-dominated electricity markets : empirical evidence for Colombia

Borradores de Economia
Number: 
886
Published: 
Authors:
Jorge Balat,
Juan Esteban Carranza-Romero,
Juan D. Martin
Classification JEL: 
L25, D22, D44
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In this paper we formulate a dynamic multi-unit auction model to characterize bidding behavior in hydro power dominated electricity markets. Our model implies that, in order to maximize expected profits, hydro producers will submit bid prices above its ma