Scheduling a capacitated single machine with time deteriorating job values

We address the scheduling problem with the following characteristics: (i) there is a single machine available, (ii) the machine has limited capacity, and (iii) job value deteriorates with time. The problem is motivated from several real world situations, such as, downloading process of web pages, and scheduling of multiplexes. Since the problem is NP-hard, we propose new heuristics based on a multiplicative piece-wise metric as an approximation of the slope of job value deterioration. Computational results show that the proposed heuristics perform better than other existing heuristics for similar types of problems.     

On the determinants of non-market strategy: The separations mechanism and cost shifting in the telecommunications industry

This study examines the relationship between performance levels and the levels of cross-subsidy attained by local exchange carriers in the United States telecommunications industry. These cross-subsidies have been obtained by firms via their engagement in a separations mechanism, based on a cost allocation process, which telecommunications sector regulatory authorities use. Non-market strategies have assumed primacy in the activities of several sectors world-wide. Thus, understanding non-market strategic choices is important in the analysis of firms’ behavior and performance. Active engagement in the separations process is an important non-market strategy in the telecommunications industry, as a firm relatively successful in this activity can gain large cross-subsidies. The analysis establishes that less profitable firms obtain greater cross-subsidies. Once the profitability variable is decomposed into its two main components, which are productivity and price recovery, the impact of the profitability variable reduces. Firms which are relatively unproductive, as well as those unable to recover higher output prices, obtain relatively greater cross-subsidies. These results are inconsistent with the postulates of the strategic cost-allocation and behavior literatures but are consistent with x-inefficiency and rent-seeking perspectives of firms’ strategic actions.     

Knowledge-Based Simulation for Business Process Redesign

This research focuses on knowledge-based simulation modeling for process redesign. Though the proposed technique can be utilized for ‘starting with a clean slate’, it is particularly well suited for situations where an existing process is already documented, and an attempt is being made to improve or redesign this process. We present a methodology that utilizes the basic process structure (represented in a matrix form), and using a rule-based knowledge acquisition system, interacts with the analyst to construct the process knowledge base. Once all the knowledge has been acquired, the system automatically generates an executable simulation model. Major benefits of this algorithmic approach include (1) reduced model building time, (2) increased analyst productivity, and (3) the assurance that basic process characteristics are not accidentally omitted in the simulation model. To test the validity and applicability of the proposed technique a prototype system has been developed that generates simulation programs in SLAM.© 1997 John Wiley & Sons, Ltd.     

Network effects and the adoption of new technology: evidence from the U.S. telecommunications industry

This paper examines variations in the adoption of new technology by firms operating in a network-based industry: telecommunications. These variations are explained as a function of three network effects: the first is the conversion effect, driven by operations-related increasing returns to scale; the second is the consumption effect, driven by demand-side increasing returns to scale; the third is an imitative effect. We expect the conversion effect to be felt more strongly during earlier phases of a technology's evolution, while a strong consumption effect is felt throughout. The imitative effect is also expected to be felt throughout. These hypotheses are examined with respect to electronic switching adoption in the local operating sector of the U.S. telecommunications industry. An analysis of the variations in adoption levels of the 40 largest firms over a period lasting from 1973 to 1987 supports our expectations, except for the imitative effect. © 1998 John Wiley & Sons, Ltd.     

Does it pay to venture abroad? Exporting behavior and the performance of firms in Indian industry

Using contemporary data for a firm-level sample of over 600 Indian firms, this paper investigates the impact that an export-orientation has on the profitability of the firms studied. The results, based on a two-stage least squares method, establish a positive and significant relationship between firms' levels of exports and profitability. For firms from developing and transition economies like India it does pay to venture abroad, and the ability to sell goods overseas has a significant impact on firms' economic performance. © 1998 John Wiley & Sons, Ltd.     

Retail Shelf Allocation: A Comparative Analysis of Heuristic and Meta-Heuristic Approaches

This research presents a retail shelf-space decision model that incorporates a nonlinear profit function, vertical and horizontal location effects, and product cross-elasticity. We propose a linear programming formulation of the nonlinear profit function that can solve the shelf-space problem optimally. We describe potential advances in heuristic and meta-heuristic algorithms and compare the approaches through simulations and a field experiment. We discuss the impact of the number of item facings, vertical location, and horizontal location (e.g., we find the vertical location effect is approximately double the size of the horizontal location effect on profit performance).     

Thy Neighbor’s Mortgage: Does Living in a Subprime Neighborhood Affect One’s Probability of Default?

This article focuses on the potential externalities associated with subprime mortgage origination activity. Specifically, we examine whether negative spillover effects from subprime mortgage originations result in higher default rates in the surrounding area. Our empirical analysis controls for loan characteristics, house price changes and alternative loan products. Our results indicate that, after controlling for these characteristics, the concentration of subprime lending in a neighborhood does not lead to greater default risks for surrounding borrowers. However, we do find that more aggressive mortgage products (such as hybrid adjustable rate mortgages and low/no‐documentation loans) had significant negative spillovers on other borrowers. Stated differently, the aggressive alternative mortgage designs were more toxic to the housing and mortgage market than previously believed.     

Market-Share Contracts with Asymmetric Information

In this paper, a dominant firm and competitive fringe supply substitute goods to a retailer who has private information about demand. We show that it is profitable for the dominant firm to condition payment on how much the retailer buys from the fringe (market-share contracts). The dominant firm thereby creates countervailing incentives for the retailer and, in some cases, is able to obtain the full-information outcome (unlike in standard screening models, where the agent earns an information rent in the high-demand state and output is distorted in the low-demand state). Our results have implications for fidelity rebates, all-units discounts, and competition policy. Although some crowding out of the fringe may occur when demand is low, we show that market-share contracts need not be harmful for welfare.     

Strategic analysis of petty corruption with an intermediary

This note reports part of a larger study of “petty corruption“ by government bureaucrats in the process of approving new business projects. Each bureaucrat may demand a bribe as a condition of approval. Entrepreneurs use the services of an intermediary who, for a fee, undertakes to obtain all of the required approvals. In a dynamic game model we investigate (1) the multiplicity of equilibria, (2) the equilibria that are “socially efficient”, and (3) the equilibria that maximize the total expected bureaucrats’ bribe income. We compare these results with those for the case in which entrepreneurs apply directly to the bureaucrats.