Rong Luo, a teacher from School of Economics, Renmin University of China, was invited to give an academic speech at this energy Economics seminar.

Activity Arrangement:

13:00-14:00 Academic report

14:00-14:30 Exchange of participants

Time: Tuesday, November 17, 2020, 13:00-14:30

Site: Meeting Room 623, Mingde Main Building, Renmin University of China

Summary of report:

Plants in many industries minimize costs subject to constraints on output and emissions, which in turn restrict input choices. We develop a novel cost function approach to estimating their production function parameters, including generation productivity and pollution abatement efficiency terms to measure unobserved heterogeneity. Applying this this technique to a panel of US coal-fired power plants, we model the firm’s trade-off of sulfur and heat content to minimize the total costs of coal and pollution control. We find substantial heterogeneity and a marked increase in abatement productivity over time, consistent with the goals of the Acid Rain cap-and-trade program. Counterfactual analysis shows that its initial allocation of emission permits substantially affected costs, due to severe restrictions on permit trading.

Brief introduction of the author:

Luo Rong is a lecturer at the School of Economics, Renmin University of China.

Luo Rong received her degree in economics and Science from Wuhan University in 2008.

In 2010, she received her Master's degree in Economics from Tsinghua University.

She received her Ph.D. in Economics from The Pennsylvania State University in 2015.

From 2015 to 2020, she served as assistant professor at Terry School of Business, University of Georgia and lecturer at School of Economics, Renmin University of China.

Her research direction is industrial organization economics. Her current research topics include dynamic firm pricing, product network effects, upstream and downstream contracts, discrete choice model, enterprice productivity estimation, law of one price, and the influence of exclusive contracts on second-hand housing prices.

The Energy Economics Seminar is regularly launched by the Department of Energy Economics, School of Applied Economics, Renmin University of China, with the aim of providing a platform for communication among scholars studying Energy economy issues in China.

Contact: Ying Zheng (yingzheng@ruc.edu.cn)