Optimal control of an invasive species with imperfect information about the level of infestation

The presence of invasive species is often not realized until well after the species becomes established. Discovering the location and extent of infestation before the invasive species causes widespread damage typically requires intensive monitoring efforts. In this paper, we analyze the problem of controlling an invasive species when there is imperfect information about the degree of infestation. We model the problem as a partially observable Markov decision process in which the decision-maker receives an imperfect signal about the level of infestation. The decision-maker then chooses a management action to minimize expected costs based on beliefs about the level of infestation. We apply this model to a simple application with three possible levels of infestation where the decision-maker can choose to take no action, only monitor, only treat, or do both monitoring and treatment jointly. We solve for optimal management as a function of beliefs about the level of infestation. For a case with positive monitoring and treatment costs, we find that the optimal policy involves choosing no action when there is a sufficiently large probability of no infestation, monitoring alone with intermediate probability values and treatment alone when the probability of moderate or high infestation is large. We also show how optimal management and expected costs change as the cost or quality of information from monitoring changes. With costless and perfect monitoring, expected costs are 20–30% lower across the range of belief states relative to the expected costs without monitoring.     

Any need for coordination of policies towards transit traffic with a negative local externality?

International transit traffic between countries can be expected to increase in the future. This paper investigates whether international policy coordination is appropriate in the case of international transit traffic causing a local environmental externality. This issue is analysed in a two-country model where traffic is used as an input in production. It is found that individual optimization of the countries is likely to result in an outcome with less than optimal international traffic, i.e. too little pollution compared with optimum.     

Corporate tax and location choice for multinational firms

This article examines the effects of corporate tax on these location decisions of newly established multinational subsidiaries across 26 European countries over an 8-year period. We contribute to the existing literature by examining the effects of a non-linear response of firm location decisions to changes in the tax rate. We also show that there are large variations in the sensitivity to tax rates across sectors and firm size groups. In particular, financial sector firms are more than twice as sensitive to changes in corporation tax rates relative to other sectors. Our baseline result is a finding that a 1% increase in the statutory or policy rate of corporation tax would lead to a reduction in the conditional location probability of 0.68%. Using the effective average tax rate, the marginal effect implies a reduction in the location probability of 1.15% following a 1% increase in the tax rate. Although overall tax has the expected negative effect on location probability, the marginal effect of an increase is lower at higher rates of tax.     

A note on the energy-efficiency investments of an expected cost minimizer

This paper analyzes a consumer's choice between a high-efficiency and a low-efficiency version of an energy-using durable when the expected lifetimes of the two versions differ. A (small) difference in expected lifetimes may induce entirely different implications for the behavior of a cost minimizing consumer, as compared to the case with equal expected lifetimes. The result supplements the explanations for the extremely high discount rates that have been reported for energy efficiency investments. We also provide sufficient conditions for the existence of a reservation property, both in the case of deterministic and of random lifetimes.     

A dynamic ecological–economic modeling approach for aquaculture management

This paper presents a Modeling Approach to Resource economics decision-maKing in EcoaquaculTure (MARKET model). The MARKET model was developed as a scenario-testing tool to provide insights on the ecological and economic interactions, which is a critical issue for sustainable aquaculture management. As a case study, the model was applied to simulate shellfish production in an embayment located in the East China Sea. A set of scenarios was used to compare the model outputs with expected trends and to test its capability to simulate relevant management scenarios. The comparison of simulated scenarios indicates that the MARKET model outputs followed the expected trends regarding both standard economic theory for consumption and production, and ecological economic theory. In all the scenarios we tested the area available for aquaculture was found to impose a limitation on production before it became less profitable to expand production. As such, in this case study, the production in the long run does not meet increasing demand. Reduction of the maximum cultivation area was simulated in one of the scenarios as an example of a conservation measure. As expected there was a reduction of the net profit of the farmers compared with the standard simulation. On the other hand, this scenario combined with an increase in price growth rate simulates a compensatory measure that led to a net profit in the same range as observed in the standard simulation. Overall the MARKET model provides insights and raises questions useful for the implementation of an ecosystem approach to aquaculture. Further developments include the simulation of waste generated by cultivated species in order to better support sustainable management objectives.     

A dynamic ecological–economic modeling approach for aquaculture management

This paper presents a Modeling Approach to Resource economics decision-maKing in EcoaquaculTure (MARKET model). The MARKET model was developed as a scenario-testing tool to provide insights on the ecological and economic interactions, which is a critical issue for sustainable aquaculture management. As a case study, the model was applied to simulate shellfish production in an embayment located in the East China Sea. A set of scenarios was used to compare the model outputs with expected trends and to test its capability to simulate relevant management scenarios. The comparison of simulated scenarios indicates that the MARKET model outputs followed the expected trends regarding both standard economic theory for consumption and production, and ecological economic theory. In all the scenarios we tested the area available for aquaculture was found to impose a limitation on production before it became less profitable to expand production. As such, in this case study, the production in the long run does not meet increasing demand. Reduction of the maximum cultivation area was simulated in one of the scenarios as an example of a conservation measure. As expected there was a reduction of the net profit of the farmers compared with the standard simulation. On the other hand, this scenario combined with an increase in price growth rate simulates a compensatory measure that led to a net profit in the same range as observed in the standard simulation. Overall the MARKET model provides insights and raises questions useful for the implementation of an ecosystem approach to aquaculture. Further developments include the simulation of waste generated by cultivated species in order to better support sustainable management objectives.     

Cost competition: new evidence on an old issue

The relation between cost changes and market share changes is examined for five size ranked cohorts of firms in US manufacturing industries. Cost reductions are expected to yield market share increases via associated price reductions. It was found that this is indeed the case, although the realation is not strong. A 10% cost reduction produces roughly a 2% market share increase, an estimated which for various reason is most likely a lower bound. Cost reductions are also associated with both price reductions and price-cost margin increases.     

GLOBALIZATION AND REGIONAL INCOME INEQUALITY: EMPIRICAL EVIDENCE FROM WITHIN CHINA

China's recent accession to the WTO is expected to accelerate its integration into the world economy, which aggravates concerns over the impact of globalization on the already rising inter-region income inequality in China. This paper discusses China's globalization process and estimates an income generating function, incorporating trade and FDI variables. It then applies the newly developed Shapley value decomposition technique to quantify the contributions of globalization, along with other variables, to regional inequality. It is found that: (a) globalization constitutes a positive and substantial share of regional inequality and the share rises over time; (b) domestic capital, however, emerges as the largest contributor to regional inequality; (c) economic reform characterized by privatization exerts an increasingly significant impact on regional inequality; and (d) the relative contributions of education, location, urbanization and dependency ratio to regional inequality have been declining.     

Bailing outsourcing

In a model of organizational choice, this paper shows that in face of an increasingly expected bailout from the government, outsourcing input production to an offshore location is more likely an optimal choice for a firm. Such a response is consistent with the three trends in the US manufacturing sector after the crisis: (a) employment keeps declining; (b) massive layoffs have not stopped; and (c) imported intermediate inputs have been gaining importance.     

Symmetry and order in the portfolio allocation problem

Summary. This research studies the role of multivariate distribution structures on random asset returns in determining the optimal allocation vector for an expected utility maximizer. All our conclusions pertain for the set of risk averters. By carefully disturbing symmetry in the distribution of the, possibly covarying, returns, we ascertain the ordinal structure of the optimized allocation vector. Rank order of allocations is also established when a permutation symmetric random vector is mapped into the returns vector through location and scale shifts. It is shown that increased dispersion in the vectors of location and scale parameters benefit, ex-ante, investors as does a decrease in the rank correlation coefficient between the location and scale parameter vectors. Revealed preference comparative static results are identified for the location and scale vectors of asset returns. For most issues addressed, we arrive at much stronger inferences when a safe asset is available. Received: August 8, 2000; revised version: January 8, 2001     

我国民工流空间分布特征与影响因素

改革开放以后,由于经济和社会的变革,我国出现了"民工潮"这一特殊现象。民工的流出流入地及流动范围也具有较强的地域空间分布特征,即多从中部地区流向东部地区。研究了我国民工流的场效应。我国存在五个主要的吸引场,分析了民工流吸引场的特点,剖析了不同区域民工流流动空间差异。通过引力面板数据模型,验证了我国民工流流动符合Harris-Todaro期望收入假设,Schulzt人口流动推拉对称假设和距离衰减假设。由于区位的差异,不同流入地、流出地的民工流影响因素略有不同。     

Expected Life-earnings Paths with and without Higher Education: The case of India

The paper analyses students' expectations of earnings with and without higher education at three career points: at entry to the labour force, at the five year point, and career peak, constructing paths of expected earnings. The estimated expected internal rates of return to investment in different types of higher education are quite high. Considering ratios of expected peak-year to entry earnings, the highest gradient is in the case of specialised/professional education. Similarly for the case of students of urban origin as compared with those of semi-urban or rural origin. Likewise, the gradient is relatively high in the case of students with an English medium of study compared with the case of students with Punjabi or Hindi. As expected, the gradient is higher for those who aspire to higher education than those who do not, in all three types of higher education. The association between expected peak earnings and the proportion of gains in earnings that take place in the first five years is negative in all cases; only expectations of sustained growth in earnings lead to the highest predicted peak earnings levels. The regression results suggest that socio-economic background, social capital, ability, and school-related variables significantly influence the formation of expectations about earnings.     

论产业群内地方联系的影响因素--以东莞电子信息产业群为例

在全球化背景下,很多国家和地区出现的具有竞争优势的产业群现象受到了区域研究学界、商界和公共政策决策者的重视。本文从产业联系的视角,首先分析自20世纪70年代后产业联系在内容及空间上的变化趋势,然后重点论述了在新时期的产业群内,影响企业地方联系强度的主要因素,在理论分析的基础上,文章剖析了东莞电子信息产业群的地方联系问题。     

Demand for parimutuel horse race wagering with special reference to telephone betting

Parimutuel horse race wagering (handle), measured in real terms, has been steadily declining for the past several decades. In an attempt to reverse this trend, a number of racetracks in the United States have instituted telephone betting systems which allow wagering from an ‘off-track’ location. The present study investigates the demand for parimutuel horse race wagering when a telephone betting system is implemented. Two demand equations are estimated for a racetrack, one for on-track (live race) handle and another for total (on-track plus telephone betting) handle. As expected, it is found that the telephone betting system has led to a decline in on-track wagering but surprisingly, it has also led to decline in total wagering, although not to the same extent as in on-track wagering. Thus, off-track wagering generated through the telephone betting system has not been sufficient to offset the loss in on-track handle. In addition to the effect of the telephone betting system, it is found that the takeout rate (price of wagering), the price of admissions, racing quality, racing days, and competition from professional sports and another racetrack in the market area are significant determinants of the demand for wagering. Demand is found to be elastic with respect to the takeout rate, inelastic with respect to the price of admissions and parking, and almost unitary elastic with respect to income.     

Unemployment Benefits, Contract Length and Nominal Wage Flexibility

In a bargaining model, we show that a decrease in the unemployment benefit level increases not only equilibrium employment, but also nominal wage flexibility, and thus reduces employment variations in the case of nominal shocks. Long‐term wage contracts lead to higher expected real wages and hence higher expected unemployment than short‐term contracts. Therefore, a decrease in the benefit level reduces the expected utility gross of contract costs of a union member more with long‐term than with short‐term contracts, thereby creating an incentive for shorter contracts. Incentives for employers are shown to change in the same direction.     

我国外资企业R&D水平的决定因素

鼓励外商进行R&D投资以推动技术进步是我国利用FDI的重要目标,但成效与目标相去甚远。FDI企业的R&D水平低,这既与外资企业R&D动机有关,也与我国区位条件有关。利用27个省、市、区2003-2007年的面板数据模型进行经验分析表明:经济发展水平、市场规模、外资规模等与外资企业R&D水平正相关,而R&D人力资本、贸易体制的开放水平等与外资企业R&D水平反相关。R&D人力资本、市场导向、生产的本地化程度回归系数符号为负与现有的研究结论不一致,主要原因可能是知识产权保护水平不高。     

中部农区农户打工簇研究——以河南省三个样本村为例

对农户打工区位的研究是认识农民工流动空间规律的基础。通过对河南省南阳市三个不同类型典型样本村的实证研究,发现农户打工区位的选择具有明显的打工簇现象,在自然村尺度上,少数的打工簇集中了多数的打工者。其形成主要由打工决策和打工区位选择中打工者所拥有的社会资本决定,主要基于传统地缘关系和血缘关系的关系网络在打工簇的形成中具有重要作用,种子打工者和潜在打工者在由关系强度决定的博弈中造成了打工簇的形成和扩散。     

Nonlinear income effects in random utility models: revisiting the accuracy of the representative consumer approximation

This article investigates the implications of nonlinear income effects in Random Utility Models (RUM) for measuring general equilibrium welfare impacts. A popular approach in applied welfare analysis is to approximate the expected compensating variation (cv) for an amenity change as the cv of a representative consumer whose indirect utility is given by the expected maximum utility. However, this approach can be misleading in the case of nonmarginal changes as it implies that changes in income do not affect the consumer's choice. In this case the true expected cv can be obtained via simulation. Empirical applications to recreational demand find that the bias from the representative approach is small. This article re-evaluates the accuracy of the representative consumer approximation in the context of measuring the general equilibrium welfare impacts of large environmental changes. Our findings suggest that, though the representative consumer approximation could lead to biased point estimates of the expected cv, this bias is overwhelmed by the size of the confidence intervals that result from the empirical estimation of household preferences.     

都市区生产者服务业企业区位因子分析——以北京为例

文章以北京为个案,通过问卷调查、企业访谈、模型验证等方法,从定性归纳和定量解释两个角度,探讨了我国都市区内部生产者服务业企业区位选择的影响因子。发现西方区位选择因子和区位理论在一定程度上适用于我国都市区快速发展起来的生产者服务业企业,但是受到政府力量的影响,在具体的区位决策时必须进行适当的修正。     

基于盖斯克模型与模糊数的综合模型在风险投资项目中的应用

风险投资项目具有高不确定性,因此将风险投资项目复合实物期权方法中的期望现金流现值和投资成本均假定为确定值是不现实的。因此本文运用了复合实物期权(Geske模型)与模糊数的综合模型。该综合模型较好地解决了风险投资项目中的期望现金流现值和投资成本不为确定值的情况,并结合实例证明了其有效性。