Francesco Scarazzato
Hi! I’m a PhD candidate in Economics at the Vienna University of Economics and Business (WU).
My research focuses on energy markets, environmental economics and industrial economics.
Journal Publications
• “When is the Electric Vehicle Market Self-sustaining? Evidence from Norway” . Nicolas Koch, Nolan Ritter, Alexander Rohlf, Francesco Scarazzato. (2022). Energy Economics , 110:105991. Link
Abstract
This paper investigates whether the world’s most mature electric vehicle (EV) market in Norway has overcome critical mass constraints and can achieve sustainable long-term equilibria without subsidies. We estimate a structural model that allows for multiple equilibria emerging from the interdependence between EV demand and charging station supply. We first estimate the resulting indirect network effects using an instrumental variable approach. Then, we simulate long-term market outcomes for each of the 422 Norwegian municipalities. We find that almost 20% of all municipalities faced critical mass constraints in the earliest stage of the market. Half of them are effectively trapped in a zero-adoption equilibrium. However, in the maturing market, all municipalities have passed critical mass. Overall, about 60% of the Norwegian population now lives in municipalities with a high-adoption equilibrium, even if subsidies were removed. This suggests that critical mass constraints do no longer justify the provision of subsidies.
Working Papers
• “The Association between Adverse Temperature Shocks and Schooling Outcomes in India: Impact Quantification and Mitigation Potentials” , with Sumit Agrawal, Pulak Ghosh and Sofie R Waltl. Working Paper
Abstract
Does extreme heat adversely affect the educational outcomes of kids in India? To address this question, we link results in the Indian Upper Primary Level Examination to information on local weather conditions, air pollution, and vegetation density sourced from remote sensing data. This link is established by precisely geo-coding school addresses. The panel structure of our data allows us to track the success of students attending the same school over four years, while accounting for any time-invariant school- or location-specific attributes. Our analysis reveals that both cumulative heat exposure and exposure to higher temperatures during examinations adversely affect students' performance. A constant increase in temperature by merely 0.5°C results in a drop in the number of students passing the exam by approximately 2% and a drop in the number of highest grades ("distinctions") of almost 15%, hinting towards a sizable potential loss in human capital. We find that the negative impact on exam pass rates intensifies with higher temperature ranges, with the effect being largest on days with maximum temperatures exceeding 40°C. Furthermore, we show that vegetation in the proximity of schools has a strong mitigating effect that increases with forest cover density: given an area of about 80 hectares around each school, 2.6 hectare of forest would offset the impact of an increase in temperature by 1°C on the probability of passing the exam, and 9.5 hectares would offset the effect of a 1°C increase, on the probability of achieving a distinction. These findings suggest that increasing vegetation in the vicinity of schools is a valid policy recommendation to soften the adverse impacts of extreme heat on adverse educational outcomes, and adapt to expected long-term changes in climate.
• “How (In-)Elastic is the Short-Run Demand for Electricity?” ( Short paper, available upon request ).
Abstract
This paper examines how the aggregate demand for electricity responds to changes in hourly wholesale market prices. I focus on a hydropower-rich country and use data on imported wind energy and accumulated precipitation as instruments for price. Using data from Switzerland from 2016 to 2023, I find that both instruments have a strong and significant price-depressing effect, and I estimate the price elasticity of aggregate demand to be -0.1. However, this responsiveness is entirely driven by the consumption of storage systems and power plants, while end-user demand remains perfectly inelastic to price fluctuations in the short-run.
Ongoing Projects
• “Hydropower and Market Power: Resource Extraction under Limited Transmission Capacity” .