Matthew Oliver

Assistant Professor

Member Of:
  • School of Economics
Office Phone:
Office Location:
Old CE Building, Room 223

Matthew E. Oliver hails from Memphis, Tennessee. He received his bachelor’s degree in Business Economics from the University of Memphis in 2008, and his PhD in Economics from the University of Wyoming in 2013.  His primary fields of expertise are energy economics, environmental and natural resource economics, and industrial organization and regulation.  Dr. Oliver’s research interests focus primarily on the regulation of energy resources and energy infrastructure, particularly natural gas markets and interstate pipelines. Additionally, he has published (and ongoing) research on other topics such as the link between corruption and resource development, the bio-economics of invasive species, and international negotiations over climate change.

  • Ph.D., University of Wyoming
  • B.A., University of Memphis
Research Fields:
  • Applied Econometrics
  • Applied Microeconomics
  • Development Economics
  • Economic Sustainability
  • Energy Economics
  • Environmental Economics
  • Environmental Regulations
  • Industrial Organization
  • Natural Resource Economics
  • Regulations
  • Energy
  • Environment
  • International Development
  • Infrastructure
Courses Taught:
  • ECON-2105: Prin of Macroeconomics
  • ECON-2106: Prin of Microeconomics
  • ECON-3110: Adv Microeconomic Analys
  • ECON-4440: Economics of Environment
  • ECON-6105: Macroeconomics
  • ECON-6380: Economic of Environment
  • ECON-7012: Microeconomic Theory I
  • ECON-7102: Environmental Econ I
Selected Publications

Journal Articles

  • Pricing flexibility under rate-of-return regulation: Effects on network infrastructure investment
       In: Economic Modelling [Peer Reviewed]

    September 2018

    When a commodity market relies upon a regulated network service industry—e.g., telecommunications, electricity, or natural gas transmission—economic efficiency in that commodity market is a crucial consideration for regulatory design. This is because insufficient infrastructure investment relative to network demand results in congestion. The extraction of associated rents has distortionary effects on commodity spot market prices. Greater regulatory flexibility in network pricing can alleviate such issues by cultivating the incentives needed for stakeholders to invest in transmission capacity. To illustrate this effect I derive and numerically solve stylized optimality conditions for access and usage prices for a gas pipeline operator under alternative regulatory models. My results have general implications for regulation in network infrastructure industries, as energy and telecommunications markets are expected to expand considerably over the coming decades.

  • Natural Gas Pipeline Regulation in the United States: Past, Present, and Future
       In: Foundations & Trends in Microeconomics [Peer Reviewed]

    June 2018

    This monograph provides a detailed overview of federal-level regulation of the U.S. interstate natural gas pipeline industry. To develop a more complete understanding of the current regulatory environment, we place contemporary rules and regulations into their proper historical context by first reviewing the evolution of gas pipeline regulation over the course of the 20th Century. We then discuss the market restructuring process that culminated in 1992 with FERC Order No. 636, review the economic and policy research that studied its effects on pipeline operations (and on the U.S. natural gas market writ large), and examine the current regulations and industry structure that have since emerged. Finally, we explore possibilities for the future of regulation in the gas pipeline industry, offering some predictions regarding the likely direction of regulatory changes, paying particular attention to the possibility of incentive-based regulation in natural gas transmission.

  • Reassessing the Links Between GHG Emissions, Economic Growth, and the UNFCCC: A Difference-in-Differences Approach
       In: Sustainability [Peer Reviewed]

    February 2018

    International climate agreements such as the Kyoto Protocol of 1997 and, more recently, the Paris Climate Agreement are fragile because, at a national level, political constituencies’ value systems may conflict with the goal of reducing greenhouse gas (GHG) emissions to sustainable levels. Proponents cite climate change as the most pressing challenge of our time, contending that international cooperation will play an essential role in addressing this challenge. Political opponents argue that the disproportionate requirements on developed nations to shoulder the financial burden will inhibit their economic growth. We find empirical evidence that both arguments are likely to be correct. We use standard regression techniques to analyze a multi-country dataset of GHG emissions, GDP per capita growth, and other factors. We estimate that after the Kyoto Protocol (KP) entered into force ‘Annex I’ countries reduced GHG emissions on average by roughly 1 million metric tons of CO2 equivalent (MTCO2e), relative to non-Annex I countries. However, our estimates reveal that these countries also experienced an average reduction in GDP per capita growth rates of around 1-2 percentage points relative to non-Annex I countries.

  • Taming Drillers through Legislative Action: Evidence from Pennsylvania's Shale Gas Industry
       In: Resource and Energy Economics [Peer Reviewed]

    November 2017

    In 2012 Pennsylvania amended its Oil and Gas Act to tighten regulations on development of shale gas resources. Three key pecuniary provisions were annual well fees, increased bonding requirements, and higher penalty limits for violations. We analyze the effects of these mandates on well operator behavior using data on well operations and inspections over the period 2000-2013. After deriving theoretical predictions, we empirically examine each provision’s effect on firm behavior in two aspects: (i) acquisition of new well permits, and (ii) regulatory violations. Overall, we find the amendments induced firms to acquire fewer permits and elevate environmental protection effort. 

  • Economies of Scale and Scope in Expansion of the U.S. Natural Gas Pipeline Network
       In: Energy Economics [Peer Reviewed]

    November 2015

    I analyze cost, capacity, mileage, and technical data for 254 U.S. natural gas pipeline projects over the period 1997–2012. Although project costs exhibit economies of scale over the capacity margin and economies of scope over the spatial margin, network expansion costs may not exhibit cost economies overall. That is, proportional increases in both transmission capacity and length (in miles) may result in a proportional (or even greater-than-proportional) increase in expansion costs. Moreover, large projects (high-capacity pipelines spanning long distances) likely require installation of compression horsepower, which has direct cost effects. My results suggest such projects exhibit significant diseconomies in cost structure. As a result, pipeline tariffs based on cost-of-service pricing likely present a disincentive for prospective pipeline customers to commit to long-term contracts—which are necessary for the pipeline to acquire regulatory permission to build—particularly for large, long-distance expansion projects. The implication is that cost-of-service pricing may inhibit network expansion, exacerbating congestion issues.

  • Pipeline Congestion and Basis Differentials
       In: Journal of Regulatory Economics [Peer Reviewed]

    September 2014

    In the U.S., natural gas pipeline transport has undergone a wave of deregulatory actions over the past several decades. The underlying motive has been the presumption that removing regulatory frictions would facilitate spot price arbitrage, helping to integrate prices across geographic locations and improve efficiency. Yet certain frictions, specifically the effect of congestion on transportation costs, inhibit positive deregulatory impacts on efficiency. With the increase in domestic production and consumption of natural gas over the coming decades, upward pressure on the demand for transport will likely result in an increased occurrence of persistently congested pipeline routes. In this paper we explore the relationship between congestion and spot prices using a simple network model, paying particular attention to the influence of storage. We find that as congestion between two hubs increases, the scarcity value of transmission capacity rises, driving a wedge between spot prices. We empirically quantify this effect over a specific pipeline route in the Rocky Mountain region that closely resembles our structural design. Although our results paint a stark picture of the impact that congestion can have on efficiency, we also find evidence that the availability of storage mitigates the price effects of congestion through the intertemporal substitution of transmission services.