This paper surveys alternative approaches to the emergence and evolution of institutions. The challenge is to develop frameworks capable of capturing both stability and change. We follow a “descaling” approach to show how founding assumptions about economics—namely, alternative assumptions about individual rationality and the role of social efficiency—influence our understanding of the drivers of institutional evolution. We then contrast two families of institutional theory. In the first, institutions are viewed as rules imposed on individuals and the focus is on the strategic games among coalitions that aim to promote or block new rules. In the second, institutions are viewed as shared beliefs; here the idea is to analyze how equilibria that are self-enforcing (in terms of mutual expectations about others’ behaviors) can collapse and so induce switching to another equilibrium. Finally, we discuss the political economy literature that examines institutional transitions to a market economy, and we identify long-term drivers as well as short-term political barriers to institutional reforms.
Traditional approaches to electricity market design need adaptation to factor in the growing share of renewables in the energy mix. Energy transition in different parts of the world is taking [...]
In this paper, we investigate two main schemes for contracting demand-side flexibility by the Distribution System Operator (DSO) at the planning stage: a voluntary demand-side connection agreement where consumers offer [...]
This article will explain the characteristics of the financial side of energy markets. It aims to clarify why financial contracts are needed in the energy sector and how such transactions [...]
The Russian invasion of Ukraine in February 2022 compounded an already difficult policy landscape characterised by rising energy prices, international supply chains’ disruptions, growing greenhouse gas emissions and exacerbating geopolitical [...]
For more than a decade, hundreds of experts have gathered at the hills overlooking Florence to analyse the evolution of European transport policy and regulation at the call of the [...]
On 14th February 2022, the European Commission published a ‘Call for evidence for an impact assessment’ (Call for Evidence) and Public Consultation related to a new framework for standard essential [...]
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