| This dissertation consists of three chapters that study economic questions related to auction and energy markets. In the first chapter, I measure the extent of (real-time) production misallocation in Texas' main electricity market for 2009, the ERCOT market, and test whether these inefficiencies are generated by the exercise of market power. Using a novel data set that combines plant-level marginal costs, firm bid schedules, and market clearing prices, I construct a set of efficient outcomes and compare them to the measured output, costs, and prices. I find that, relative to the efficient allocation, costs increase by 9.5 and 34 percent, or $160 million to $472 million in 2009. I also find systematic departures from competitive pricing in the spot market that increase revenues by at least $192 million. Finally, I show that most firms exhibit behavior that is consistent with theoretical predictions of strategic behavior in the auction mechanism, which suggests that market distortions are generated by the exercise of market power.;The second chapter proposes a framework for identification and estimation of a private values model with unobserved heterogeneity from bid data in English auctions, using variation in the number of bidders across auctions. We extend the framework to settings where the number of bidders is not cleanly observed in each auction, and illustrate our method on data from eBay auctions. We find that even in auctions for identical "new-in-box" items, auction-level heterogeneity accounts for 41 percent of the price variation, and ignoring this heterogeneity would lead to a 15 percent overestimate in bidder surplus.;The third chapter studies the effect of power plant closures on local housing prices. We combine data on power plants with transactional housing price data for the Midwest to estimate the effect of power plant closures on local housing prices using difference-in-differences estimation. We find that the retirement of a fossil fuel power plant leads to an increase in local housing prices of 6 percent. The effect is heterogeneous across fuel type, as we find an increase of 4 to 6 percent for natural gas, an increase of 0 to 11 percent for petroleum, and a decrease of 7 to 8 percent for coal. |
