David Sappington

David E. M. Sappington is an American economist, academic advisor, and author. He is an Eminent Scholar in the Department of Economics, and the Director of Robert F. Lanzillotti Public Policy Research Center at the University of Florida. His research focuses on the study of regulatory policy issues in the communications and energy sectors.

Sappington has published nearly 200 articles in economic journals and co-authored four books. He is an associate editor of The RAND Journal of Economics, and the Journal of Regulatory Economics. He is also a co-editor of Journal of Economics and Management Strategy.

Education Sappington received his bachelor's degree in economics from Haverford College in 1976. He earned his master's and doctoral degrees in economics from Princeton University in 1978 and 1980, respectively. He also served as the President of the International Industrial Organization Society from 2008 to 2009. He has been recognized as one of the top scientists in the field of Economics and Finance by Research.com.

Sappington's research focuses on the optimal design of reward structures in the presence of limited information. His early research focuses on the special complications that arise when economic actors have limited resources, and so cannot be held financially liable for poor performance.

Sappington's later research emphasizes the optimal design of regulatory policy when the regulator does not have ready access to all relevant information. Historically, economists typically analyzed the design of regulatory policy in settings where the regulator is well-informed about all relevant elements of the environment. In practice, regulators (and policymakers more generally) seldom are perfectly informed about all relevant aspects of the environment in which they operate. Limited information complicates the design of the regulatory policy. Sappington's research examines the optimal design of regulatory policy when the regulated firm is better informed about the environment in which it operates than the regulator.

Sappington's research demonstrates that the optimal regulatory policy varies with the details of the prevailing information asymmetry. The optimal policy varies according to whether the firm's privileged information pertains to its fixed costs of production (which do not vary with the scale of its operation), to its variable costs (which vary with scale), or to both. Furthermore, the optimal policy can be quite distinct when the firm is better informed than the regulator about the demand for its products, rather than about its costs of producing these products.

Some of Sappington's research examines how well simple regulatory policies can replicate the performance of fully optimal policies. His research also examines the implications of advanced theoretical analysis for the practical implementation of regulatory policy, and examines the impact of incentive regulation on industry performance. Much of his early research focuses on the design of regulatory policy in the telecommunications industry. His more recent research examines policy design in the energy sector. This research includes analyses of the design of policies to promote energy conservation, distributed generation of electricity, energy storage to complement energy generation and transmission, and forward contracting to ensure the long-term supply of electricity at affordable prices.

Awards and honors 2000 - Faculty Honoree, Anderson Scholars Program University of Florida 2003 - Distinguished Service Award, Public Utility Research Center, University of Florida 2008 - Elected President of the International Industrial Organization Society 2011 - Awarded Research Foundation Professorship, University of Florida 2015 - Distinguished Member Award, Transportation and Public Utilities Group 2017 - The Energy Journal’s Campbell Watkins Best Paper Award