A Shocking Truth For Law And Economics

Consumer Welfare Explains the Internal Market for Electricity Better Than Total Welfare

Fabrizio Esposito, Lucila de Almeida

Forskningsoutput: Kapitel i bok/rapport/konferenshandlingKapitelVetenskapligPeer review

Sammanfattning

This chapter challenges the use of total welfare as the axiological assumption adopted by economically-informed legal scholarship in the field of electricity. To do so, it demonstrates that the efficiency hypotheses can be grounded in two different economic rationales: the traditional one based on total welfare; and an alternative one based on consumer welfare. To challenge the uncritical endorsement of total welfare, the chapter chooses the competition pillar for the EU internal market for electricity as a case study and shows that consumer welfare better explains its economic rationale. This finding proves that the economically-informed legal scholars are wrong in considering total welfare an unquestionable starting point for their research. This will likely be a ‘shocking truth’ for law and economics scholars. The argument is articulated in four steps. The first step builds the methodological foundations. It describes two types of explanatory claims, one external and the other internal to legal discourse, and discusses the superior relevance of the latter to legal practice. The second step lays the analytical framework. It identifies points of divergence between the two efficiency hypotheses, total and consumer welfare, with a focus on electricity markets. The third step reviews the economically-informed legal scholarship and the economic one on the regulation of electricity markets. It shows that scholars endorse total welfare, consumer welfare, and even both. The fourth and final step enters the realm of the EU internal market for electricity and proves that the economic rationale of legal materials and legal discourse is better explained by consumer welfare. This finding supports our alternative efficiency hypothesis based on consumer welfare.
Originalspråkengelska
Titel på gästpublikationEnergy Law and Economics
RedaktörerKlaus Mathis, Bruce R. Huber
Antal sidor33
UtgivningsortCham
FörlagSpringer
Utgivningsdatum20 apr 2018
Sidor101-133
ISBN (tryckt)978-3-319-74635-7
ISBN (elektroniskt)978-3-319-74636-4
DOI
StatusPublicerad - 20 apr 2018
MoE-publikationstypA3 Del av bok eller annan forskningsbok

Publikationsserier

NamnEconomic Analysis of Law in European Legal Scholarship book series (EALELS)
FörlagSpringer
Volym5

Vetenskapsgrenar

  • 513 Juridik

Citera det här

Esposito, F., & Almeida, L. D. (2018). A Shocking Truth For Law And Economics: Consumer Welfare Explains the Internal Market for Electricity Better Than Total Welfare. I K. Mathis, & B. R. Huber (Red.), Energy Law and Economics (s. 101-133). (Economic Analysis of Law in European Legal Scholarship book series (EALELS); Vol. 5). Cham: Springer . https://doi.org/10.1007/978-3-319-74636-4
Esposito, Fabrizio ; Almeida, Lucila de. / A Shocking Truth For Law And Economics : Consumer Welfare Explains the Internal Market for Electricity Better Than Total Welfare. Energy Law and Economics. redaktör / Klaus Mathis ; Bruce R. Huber. Cham : Springer , 2018. s. 101-133 (Economic Analysis of Law in European Legal Scholarship book series (EALELS)).
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Esposito, F & Almeida, LD 2018, A Shocking Truth For Law And Economics: Consumer Welfare Explains the Internal Market for Electricity Better Than Total Welfare. i K Mathis & BR Huber (red), Energy Law and Economics. Economic Analysis of Law in European Legal Scholarship book series (EALELS), vol. 5, Springer , Cham, s. 101-133. https://doi.org/10.1007/978-3-319-74636-4

A Shocking Truth For Law And Economics : Consumer Welfare Explains the Internal Market for Electricity Better Than Total Welfare. / Esposito, Fabrizio; Almeida, Lucila de.

Energy Law and Economics. red. / Klaus Mathis; Bruce R. Huber. Cham : Springer , 2018. s. 101-133 (Economic Analysis of Law in European Legal Scholarship book series (EALELS); Vol. 5).

Forskningsoutput: Kapitel i bok/rapport/konferenshandlingKapitelVetenskapligPeer review

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N2 - This chapter challenges the use of total welfare as the axiological assumption adopted by economically-informed legal scholarship in the field of electricity. To do so, it demonstrates that the efficiency hypotheses can be grounded in two different economic rationales: the traditional one based on total welfare; and an alternative one based on consumer welfare. To challenge the uncritical endorsement of total welfare, the chapter chooses the competition pillar for the EU internal market for electricity as a case study and shows that consumer welfare better explains its economic rationale. This finding proves that the economically-informed legal scholars are wrong in considering total welfare an unquestionable starting point for their research. This will likely be a ‘shocking truth’ for law and economics scholars. The argument is articulated in four steps. The first step builds the methodological foundations. It describes two types of explanatory claims, one external and the other internal to legal discourse, and discusses the superior relevance of the latter to legal practice. The second step lays the analytical framework. It identifies points of divergence between the two efficiency hypotheses, total and consumer welfare, with a focus on electricity markets. The third step reviews the economically-informed legal scholarship and the economic one on the regulation of electricity markets. It shows that scholars endorse total welfare, consumer welfare, and even both. The fourth and final step enters the realm of the EU internal market for electricity and proves that the economic rationale of legal materials and legal discourse is better explained by consumer welfare. This finding supports our alternative efficiency hypothesis based on consumer welfare.

AB - This chapter challenges the use of total welfare as the axiological assumption adopted by economically-informed legal scholarship in the field of electricity. To do so, it demonstrates that the efficiency hypotheses can be grounded in two different economic rationales: the traditional one based on total welfare; and an alternative one based on consumer welfare. To challenge the uncritical endorsement of total welfare, the chapter chooses the competition pillar for the EU internal market for electricity as a case study and shows that consumer welfare better explains its economic rationale. This finding proves that the economically-informed legal scholars are wrong in considering total welfare an unquestionable starting point for their research. This will likely be a ‘shocking truth’ for law and economics scholars. The argument is articulated in four steps. The first step builds the methodological foundations. It describes two types of explanatory claims, one external and the other internal to legal discourse, and discusses the superior relevance of the latter to legal practice. The second step lays the analytical framework. It identifies points of divergence between the two efficiency hypotheses, total and consumer welfare, with a focus on electricity markets. The third step reviews the economically-informed legal scholarship and the economic one on the regulation of electricity markets. It shows that scholars endorse total welfare, consumer welfare, and even both. The fourth and final step enters the realm of the EU internal market for electricity and proves that the economic rationale of legal materials and legal discourse is better explained by consumer welfare. This finding supports our alternative efficiency hypothesis based on consumer welfare.

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Esposito F, Almeida LD. A Shocking Truth For Law And Economics: Consumer Welfare Explains the Internal Market for Electricity Better Than Total Welfare. I Mathis K, Huber BR, redaktörer, Energy Law and Economics. Cham: Springer . 2018. s. 101-133. (Economic Analysis of Law in European Legal Scholarship book series (EALELS)). https://doi.org/10.1007/978-3-319-74636-4