The paper deals with the Supply Function Equilibrium (SFE) as a model of competition in electricity markets. It introduces theoretical advancement through relaxing traditional assumptions of continuity of supply functions and provides a foundation for efficient computational algorithms. Special emphasis is placed on exploring the existence of equilibria and on the players’ ability to learn subj...

Consider a market where producers submit supply functions to a procurement auction — e.g. an electric power auction — under uncertainty, before demand has been realized. In the Supply Function Equilibrium (SFE), every firm commits to the supply function maximizing his expected profit given the supply functions of the competitors. The presence of multiple equilibria is one basic weakness of SFE....

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We consider a model where a finite number of producers compete to meet an infinitely divisible but inelastic demand for a product. Each firm is characterized by a production cost that is convex in the output produced, and firms act as profit maximizers. We consider a uniform price market design that uses supply function bidding: firms declare the amount they would supply at any positive price, ...

We consider a model where a finite number of producers compete to meet an infinitely divisible but inelastic demand for a product. Each firm is characterized by a production cost that is convex in the output produced, and firms act as profit maximizers. We consider a uniform price market design that uses supply function bidding (Klemperer and Meyer 1989): firms declare the amount they would sup...

this paper represents a theoretical model from which the supply function for a durable goods is derived. it turns out that consumer at the equilibrium condition equates its user cost with the marginal value of services received by using an additional unit of durable goods. the stock price is obtained from this condition. in addition, at the equilbrium condition for producer, the stock price is ...