Ying Zheng

Assistant Professor of Economics at the Renmin University of China.

Primary: Empirical IO, Applied Microeconomics.

Secondary: Econometrics, Corporate Finance, Energy Economics, Environmental Economics

Publications

  • “Price ceilings as focal points to reach price uniformity: Evidence from the Chinese gasoline market,” Energy Economics. 92, 1-11, 2020. [corresponding author with Xiaobing Zhang, Yinxin Fei and Lei Zhang.]DOI.

  • “The Dynamic Complementarity of Renewable Energy Sources: A Bayesian Vector Autoregressive Approach,” International Journal of Green Energy. 1–13, 2022. [corresponding author with Jinliang Che, Zidong An and Feng Song.]DOI.

  • “Accounting and Decomposition of China’s Co2 Emissions 1981–2020,” Applied Energy. 124104, 2024. [corresponding author with Chen, Z., J. Ma, N. Wang, Z. Chen, L. Wang, Q. Xiong and P. Chen, H. Zhang.]DOI.

  • “Asymmetric Pass-through of Crude Oil Prices to Gasoline Prices: Evidence from Chinese Gasoline Pricing Reform,” International Journal of Global Environmental Issues. [Accepted, corresponding author with Xiaobing Zhang and Mengyang Liu.]

Books

“Energy Storage and Electricity Markets for New Power Systems,” China Machine Press, 2024(in Chinese),[with Xi He, Xuewen Geng, Shanpeng Pei and Jian Liu]. ISBN 9787111757733. link.

Working Papers

  • “How Costly to Sell a Company? A Structural Analysis of Takeover Auctions,” with Dong-Hyuk Kim. (under review)
    Abstract To explain why sellers in takeover auctions limit bidders entry, we structurally measure economic costs incurred by the seller for inviting an additional bidder. Our auction model allows bidders to discount their synergy values when rivals obtain the target company’s confidential information, which induces the information cost. We identify the model primitives with unobserved heterogeneity, as confidential information is latent. From a sample of U.S. M&As, we find that the unobserved heterogeneity is critical, bidders lower values by 11.9% for each rival, and the information (operation) cost amounts to 1.3% (4.1%) of the equilibrium deal value for a representative target.
  • “When Carbon Emission Trading Meets a Regulated Industry: Insights from Coal-fired Power Sector in China,” with Dong-Hyuk Kim and Hui Qiao. (under review).
    Abstract We analyze the impact of emission trading systems, such as tradable performance standards (TPS) and cap-and-trade (C&T) schemes, in China's coal-fired generation sector characterized by price regulation and high concentration. Our oligopoly model shows that TPS and C&T partially offset the adverse effects of power prices regulated below equilibrium. Unlike C&T, TPS further facilitates production reallocation towards low-emission firms, suggesting its efficacy in emission reduction. From market data, we uncover cost functions for five major firms in Guangdong province to conduct realistic policy simulations. Compared to the current TPS setup, the optimal TPS and C&T under the regulated price reduce emissions by 11.1 and 7.6 million tonnes, respectively. The optimal TPS enhances social welfare by 250 million RMB, while the optimal C&T decreases it by 485 million RMB. Moreover, the optimal TPS above approximates the case where the power price is further adjusted to maximize social welfare.

  • “Market Structure and Firm Conducts in the Chinese Photovoltaic Industry,” with Li Su. (under review).

  • “Optimal Storage Adoption Level for Wind Farms: Evidence from China,” with Yucheng Qian and Hui Qiao.

  • “Market Power in Electricity Markets with Renewables: The Effects of Ownership and Forward Contract Allocation,” with Jing Long.
    Abstract Motivated by the growth of renewable generation and development of electricity market in China, this study analyzes the impact of renewable penetration on the market outcomes under different market and ownership structure. We construct a two-stage oligopolistic model consisting symmetric strategic suppliers and competitive fringe suppliers who are allowed to make production decisions for each of their generation technology. Based on the theoretical model, we further conduct a series of simulation study to illustrate the theoretical result by exploring different set of model parameter configurations. We find that the amount of price decline could be partially or fully reduced when strategic suppliers a large proportion of renewable generation assets as a result of market power. Using the ownership and capacity information of the “big-five” electricity groups, Our simulation shows that this ownership effect will emerge in the future Chinese electricity market according to China’s renewable policy and targets. Furthermore, the forward contracting stage is pro-competitive or even over-competitive, depending on both the market and ownership structure.

Works in progress

  • “Optimal Shortlisting Rule with Entry Control by An Informed Seller.”
    Abstract This study is a theoretical extension of my job market paper of takeover auctions, where indicative bidding and shortlisting is a common practice. I first develop a two-stage auction model with entry control by an informed seller who observes bidders’ initial types (signals). Then I study how the seller, who has information valuable to the bidders, maximizes his expected profit by shortlisting potential bidders into the final-stage auction. The shortlisted bidders are asymmetric in their types (private valuation plus beliefs) because their private beliefs about the other shortlisted bidders rely on their private initial types. Except for takeover auctions, this model also describes many real-world auctions with a qualification stage, such as a real estate sale.
  • “Optimal Auction Design with Selective Entry.”
    Abstract This paper studies the optimal auction design by a revenue-maximizing seller in a two-stage auction model with selective entry. Following Stegeman (1996) and Lu (2009), I consider the feasible semidirect mechanism with a symmetric threshold-entry. In order to implement the optimal entry threshold, we need to consider a generalized virtual value, which is non-monotone in general. To handle the non-monotonicity of the generalized virtual value, I use the ironing technique described in Myerson (1981) to obtain a monotone (ironed) virtual value. Then we select the optimal mechanism to maximize the (ironed) virtual value.
  • “Platform Competition with Intra-Group Price and Non-price Discrimination,” with Tao Jiaqi, Huang Jun.