We consider a manufacturer’s new market entry problem when it already has some established facility in its existing market. We consider two common market entry strategies: the export strategy and the foreign direct investment (FDI) strategy. In the export strategy the firm increases the capacity at its existing facility and subsequently allocates the output to the existing and the new market dy...

energy policy making in the third millennium is summarized in three areas. the first area: moving toward the use of renewable, clean and environment compatible energy, the second area: restructuring in the energy sector, to make it competitive, & finally, the third area is: increasing efficiency in energy consumption. power industry as a growing sub-section of energy sector, especially in recen...

This paper develops a system dynamics model to analyze the impacts of different kinds of capacity payment as investment incentive mechanisms in Iranian electricity market. Since it is aimed that the incurred capital and operating costs of generation technologies be recovered in Iranian electricity pool, the noncompetitive capacity payment mechanism has been introduced for this purpose in order ...

The generator’s competition strategy has become a pressing research field since the opening of power market. In real market situation Generators have to deal with capacity allocation among different markets (i.e. day-ahead spot market, contract market and ancillary service market) and competition strategy optimization simultaneously. However these two interrelated problems have been studied sep...

We analyze endogenous capacity formation in a large frictional market with perfectly divisible goods. Each seller posts a price and decides on a capacity. The buyers base their decision on which seller to visit on both characteristics. In this setting we determine the conditions for the existence and uniqueness of a symmetric equilibrium. When capacity is unobservable there exists a continuum o...

Capacity reservation contracts and spot markets are two alternative purchasing practices. We focus on the cost-effective management of the combined use of these two procurement sources. Due to the variability of the spot market prices and demand uncertainty, the flexibility of combined sourcing can be advantageous. Spot market purchasing is a benefit in case of low spot market prices or insuffi...