Holding up Green Energy: Counterparty Risk in the Indian Solar Power Market
研究交易对手风险如何影响太阳能采购价格，利用印度各州与中央政府中介的拍卖数据，发现平均州级风险使太阳能价格上涨10%，并抑制绿色能源投资。
This paper studies how the risk of hold‐up affects procurement. I use data on the universe of solar power auctions in India. The Indian context allows clean estimates of counterparty risk, because solar plants set up in the same states, by the same firms, are procured in auctions intermediated by either risky states themselves or the trusted central government. I find that the counterparty risk of an average state increases solar prices by 10%. This risk premium sharply reduces investment, because demand for green energy is elastic. Contract intermediation by the central government eliminates the counterparty risk premium.