Sequential Procurement With Subcontracting

Two symmetric sellers are approached sequentially by fragmented buyers. Each buyer conducts a second-price auction and purchases from the seller who offers the lower price. Winning an auction affects bidding for future contracts because the sellers have nonconstant marginal costs. We assume that the sellers are completely informed, and we study the unique equilibrium that survives iterated elimination of weakly dominated strategies. If subcontracting between the sellers is impossible, the final allocation of contracts is generally inefficient. If postauction subcontracting is possible, the sellers can be worse off, ex ante , than when subcontracting is impossible.     

Did Hayek have a monetary theory of business cycles?

Joseph Schumpeter, a careful reader of Hayek, categorized Hayek??s theory of economic cycles as non-monetary. Almost every other source, including Hayek himself, categorized the theory as monetary. The issue turns on the concept of causality being used. The question of what causality concept to apply to complex phenomena has substantive implications for economic theory. A simple concept of causality, appropriate to the study of some physical phenomena, will mislead when applied to complex phenomena. We provide examples of errors in analysis that follow from the wrong choice of a causal paradigm.     

Sustainability,Social Discount Rates and the Selection of Project Procurement Method

The notion of sustainability has lead to the evaluation of public projects in terms of wider socio-economic and environmental benefits. The Cost Benefit Analysis and its respective, Social Discount Rate (SDR), is of crucial importance, especially when the advantages of private financing are to be demonstrated in comparison with the alternative traditional procurement of works and services. The SDR seen as a measure of a country’s value of future costs and benefits is related to the notion of promoted sustainability. The impact of smaller and declining SDRs on project selection is investigated, and a conceptual formulation concerning the selection of the project procurement method is presented. The modelled formulation will assist central and local governments in assessing projects and the potential benefit of private financing.     

Implementing technology-forcing policies: The 1970 Clean Air Act Amendments and the introduction of advanced automotive emissions controls in the United States

Technology forcing is a strategy where a regulator specifies a standard that cannot be met with existing technology, or at least not at an acceptable cost. Using the 1970 U.S. Clean Air Act for controlling automobile emissions as a baseline example, we demonstrate the importance of the regulatory implementation process if regulations are to foster technological change. The 1970 legislation required steep emissions reductions for new 1975 and 1976 automobiles, which presented automakers with major technical and economic challenges. Nevertheless, the U.S. Environmental Protection Agency successfully forced the adoption of two marquee control technologies—the catalytic converter in 1975 and the three-way catalyst in 1981. We focus on three factors critical to the implementation process: agency credibility to enforce standards, competitive pressures to drive industry research and development, and uncertainty about technological development.     

Impact of telephone and satellite earth station installations on GDP : A model for rural areas of LDCs

Presents a method for estimating the impact on national development of installation of telecommunication facilities in rural areas of developing countries. A methodology developed by Hardy is applied to three groups of developing countries and a hypothetical rural region to estimate the impact on GDP per thin route satellite earth station installed over a ten year period. A logarithmic relationship between telephone density and impact on GDP per earth station is found, so that the impact per earth station increases with lower telephone densities. The model can be used to estimate the impact on national GDP of telephone installations and/or thin route earth stations in regions of low telephone density.     

A Response to 'Ecotourism on Trial: The Case of Billfish Angling as Ecotourism'

This paper estimates the quantity of pollutant produced by the Hong Kong hotel industry through diesel oil consumption. A survey of 20 hotels was carried out to collect three years' energy consumption data. Regression analysis indicated that gross floor area was a major and statistically accepted factor in explaining diesel oil consumption. Diesel oil consumption had reduced from the early 1990s and stabilised by the late 1990s. The sulphur dioxide, nitrogen dioxide, carbon dioxide and particulate pollution created by the hotel industry's diesel oil usage from 1990 to 1999 is estimated. The findings indicate that existing green measures and devices are passive and depend on the assimilation of the atmosphere. Environmental costs have stabilised at about HK$54,000 per annum. More proactive approaches to reduce usage and environmental impacts are proposed.