This paper presents an economic framework for designing demand curves in Forward Capacity Market (FCM). Capacity demand curves have been recognized as a way to reduce the price volatility inherited from fixed capacity requirements. However, due to the lack of direct demand bidding in FCM, obtaining demand curves that appropriately reflect load’s willingness to pay … Read more
We extend the analysis of [27] to handling more general utility functions: piece-wise linear functions, which include Leontief’s utility. We show that the problem reduces to the general analytic center model discussed in [27]. Thus, the same linear programming complexity bound applies to approximating the Fisher equilibrium problem with these utilities. More importantly, we show … Read more
In this paper we show that if all agents are equipped with discrete concave production functions, then a feasible price allocation pair is a market equilibrium if and only if it solves a linear programming problem, similar to, but perhaps simpler than the one invoked in Yang (2001). Using this result, but assuming discrete concave … Read more