Access the article through Science Direct

In this paper, we constructed a two-period model to show why the price of storable goods may be determined by a price floor even though the price floor lies strictly below that price.

Access the article through the University of Chicago Press.

Price-responsive supply can enhance the performance of real-world regulatory environments through an adjustment mechanism that responds instantaneously to new information about abatement costs. 

We use experiments to examine the effects of California’s greenhouse gas emissions controls, and find that they have the potential to cause higher price variability and market manipulation.