Benefit-cost analysis and resource allocation decisions

Concern over the U.S. federal government's deteriorating infrastracture and large budget deficits has recently resulted in much attention being focused on the subject of federal capital expenditures (investments). At the same time, the Office of Management and Budget has recently taken steps to aggressively pursue a policy of requiring federal government managers to use benefit-cost (B-C) analysis techniques in preparing requests for certain types of capital expenditures. More specifically, OBM now requires the use of benefit-cost analysis techniques for major initiatives concerning the acquisition of information technology systems. In this paper it is argued, and empirically verified, that the federal government's use of B-C analysis technique affects the resource allocation process differently at different organizational levels (i.e. different decision strategies are appropriate at different organizational levels).     

Duplication, Growth and ‘Total Return Economics’

Maintenance consumption is an expense recovered in product prices, yet also a source of taste satisfaction which must be exhausted, rather than reinvested, from the capital affording it. This riddle is solved in the duplication rules: the cost of maintenance consumption is recovered in pay and prices, but an equal flow is exhausted from the human capital of the worker earning the pay. The rules impact tradition in several ways. If output is defined in principle as value added, then it cannot also be described as consumption plus net investment without double-counting the maintenance consumption recovered in prices. Also rate of return in the stationary state is not zero, but is the rate sufficient to offset the exhaustion of individual human capital. The rules lead to new insights into economic return, and support an argument that all growth at the scale of closure is due to productivity gain rather than to thrift.     

Remote data analysis,visualization and problem solving environment (PSE) based on wavelets in the geosciences

We discuss here the issues faced by earth scientists in analyzing and visualizing large datasets over a GRID-like setup from a client-server perspective. We approach this problem by using a remote, web-based visualization and data analysis framework, called WEB-IS, and by employing second-generation wavelets as a means for reducing the amount of data transferred and for extracting coherent features in complex geophysical flows and surface faulting patterns. As an example, we describe how onboard processors on satellites can function as a server for beaming down extracted information to the client computer on the ground, thus exemplifying WEB-IS as a viable middleware on a GRID network for geosciences.     

Mutually beneficial loan workouts

Loan losses are a natural part of the lending function of a bank. When default occurs, a bank must decide to foreclose or forebear on the loan. The forbearance decision involves a negotiation of a workout arrangement permitting the borrower to continue to invest in the project. This paper models the bank’s workout decision and differs from other papers by jointly modelling the borrower’s decision to accept a workout arrangement. The result is the set of conditions that yield a mutually agreeable workout. Alternative cases are examined to determine the impact of size and borrower alternatives on the acceptance/rejection of a workout decision.     

The effect of unions on the innovative behaviour of firms in Canada

Survey data on a sample of Canadian establishments are used to examine the influence of unions on technological change. The analysis indicates that unionism is not a significant determinant of the rate of technological change. However, union presence does appear to affect the way in which innovation takes place.     

GROWTH AREAS,GROWTH CENTRES AND REGIONAL CONVERSION*

Five arguments in favour of a growth area strategy have been analysed and though all of them lack empirical substance, they have certain merits on a priori grounds. Thus any policy which contributes, on the long-run, to a more rapid concentration of a region's population into relatively large urban areas, is likely to create the conditions for servicing net and replacement demand for social/economic overhead capital at a low per capita cost. Moreover for a given subsidy cost, discriminatory investment in the dense, complex, urbanised areas of a region may maximise the flow of income to regional earners in the short-run: attract the maximum flow of exogenous enterprise and capital; and give the best chance of creating a new export base which reduces the regional balance-of-payments deficit and provides sufficient job-opportunities to restrain the flow out of the region of the economically active. In addition, the quality and content of shortterm regional planning may be improved if the mix and scheduling of public investment over time is given a rigorous spatial dimension. Thus, on all of these counts, there are convincing reasons for encouraging an especially rapid development of the relative large, dense interrelated urban areas and by contrast good reasons for a relative neglect of the small hinterland areas.