Drew Van Kuiken

Economists have long recognized that infrastructure is important for welfare, but figuring out the marginal benefit of infrastructure is difficult. In this paper, I study how infrastructure policy shifts the equilibrium level, location, and technological composition of entry. My setting is the Texas electric grid, where transmission infrastructure is scarce and production varies by location and technology. I solve a dynamic entry game for renewable generators, capturing spatial and technological entry margins. Embedded within my entry game is a novel, physically realistic model of electricity dispatch, where electricity flows and prices are endogenous. The model is estimated using data from 2018-2024 with generation, transmission capacity, and demand information. I compare entry patterns under three transmission provision policies: a Texas baseline with a fixed grid; a Pigouvian tax, where entrants pay for their own grid upgrades; and a Market policy, where generators and consumers submit bids for grid upgrades. I find that entrants paying for their own upgrades, a common policy in the U.S., reduces welfare by $1.2 billion relative to the baseline because entrants choose worse quality locations with lower upgrade burdens. The Market policy increases welfare by $1.2 billion, as entrants choose higher resource quality locations and congestion decreases on the grid. My results suggest that the marginal benefit of infrastructure depends on endogenous entry decisions, so welfare-maximizing infrastructure policies should coordinate infrastructure provision with firm entry.

We analyze consumer search and purchase behavior in response to airline revenue-management practices using data from a major carrier’s website and Google Flights. We first describe patterns in search timing, purchase decisions, and paid fares. Then we estimate a multinomial logistic regression to identify factors driving search timing, finding that single adults with loyalty status, especially booking one-way nonstop itineraries, tend to search closer to departure. Next, we use a binary logistic model of conversions of searches to sales, showing that competitors' prices and changing customer composition explain rising conversion probabilities as departure nears. Finally, using a fixed-effects regression, we reveal how search and booking patterns affect prices paid. Late-arriving travelers, particularly single adults with loyalty status, pay substantially more, consistent with the airline’s pricing strategies that segment more inelastic customers. Overall, our findings underscore how revenue-management, competitor fares, and consumer characteristics jointly shape online search and purchase behavior.

We study the role of electricity storage in a long-run equilibrium model with multiple storage technologies and region-specific renewable resources. Varying storage costs and efficiency as well as policy across a rich set of simulations, we characterize storage regimes, substitution patterns, and emissions impacts. A central result is that the temporal pattern of storage use is an equilibrium outcome rather than being fixed by technological characteristics; both short- and long-duration storage are commonly used for relatively short-term arbitrage. Nevertheless, technological differences shape the extent to which one type of storage can substitute for another.

The airline industry has undergone many changes in the last 30 years and faced substantial scrutiny over performance and pricing. Our analysis combines a variety of data sources to provide a long-term perspective on market structure and its impact on consumer welfare. We begin by documenting trends in prices, network connectivity, consolidation, low-cost competition, passenger values, and measures of service quality. To measure the impact of these factors on consumer welfare, we estimate a structural model of price competition between airlines to recover consumer's preferences over service attributes and identify determinants of airline's costs. We find that consumer welfare has steadily improved over this period with increased low-cost competition and improvements to legacy networks being the primary contributors. We discuss the implications of our results for policy directed at the industry.