Productivity Growth and Some of Its Determinants in the Deregulated U.S. Railroad Industry

This study analyzes the effects of an important postderegulation innovation on rail freight productivity: the elimination of cabooses and related crew members. It also analyzes the overall growth of productivity in rail freight between 1983 and 1997 (using a translog rail cost function estimated over a sample of Class I railroads between 1983 and 1997). The results indicate that elimination of cabooses and associated crew members from freight trains reduced costs by 5-8% on the typical Class I railroad in 1997, equivalent to an annual cost saving of $2 billion to $3.3 billion for all Class I railroads. Moreover, if Class I railroads had no other technological advances since 1983, their 1997 costs (with 1997 factor prices) would have been 36-43% higher than they in fact were. Finally, the results show that overall productivity growth in rail freight did not decelerate between 1983 and 1997; if anything, it accelerated slightly.     

Hydrogen limitation--a method for controlling the performance of membrane biofilm reactor for autotrophic denitrification of wastewater.

Hydrogen-driven denitrification using the fiber membrane biofilm reactor (MBfR) was evaluated for consistent operation in tertiary wastewater treatment. The possibility of controlling the process rates, as well as biofilm parameters by supplying limited amounts of electron donor (hydrogen), was tested. Limiting the hydrogen supply proved to be efficient in controlling the biofilm growth and performance of the MBfR. Denitrification rates remained unchanged for both synthetic wastewater (SWW) and real municipal wastewater (MWW) effluent as well through the fluctuations in the substrate (NO3-N) concentration. The average denitrification rates were 0.50 (+/- 0.02) g NO3-N per day per m2 for SWW and 0.59 (+/- 0.04) g NO3-N per day per m2 for MWW. Biofilm density rather than thickness was the determining factor in substrate diffusion and biofilm sloughing, ultimately determining operating stability. Limited hydrogen supply assured constant volatile solids (VS) concentration in the biofilm. It was determined that VS/TS ratio higher than 0.25 assured stable biofilm operation. Decrease of VS/TS ratio below 0.25 led to shearing of the nonbiological outer layers of the biofilm. The values of chemical oxygen demand (COD), volatile suspended solids (VSS) and total suspended solids (TSS) in the final effluent were stable and well below wastewater effluent guidelines. Substitutions of bicarbonate with gaseous carbon dioxide as the carbon source did not affect denitrification rates despite lower than optimum pH conditions.     

Open economy and financial burden of corruption: theory and application to Asia

We discuss why corruption remains high and show that corruption contributes to the Banking distress and to the rapid transmission across international stock and currency markets. Undeveloped ‘derivative securities’ markets make the risk from stress-induced volatility difficult to manage. Vinod’s (1999) closed economy model is extended to indicate the asymmetry of ‘home bias’ and the effect of corruption on the value at risk (VaR). Our theory predicts that capital flight controls will be many, foreign direct investment (FDI) will be low and cost of capital will be high in corrupt developing countries, which is supported by Asian data. We include some policy recommendations regarding financial institutions and markets.     

A note on incentive incompatibility under franchising

This note provides a formal demonstration of the incentive incompatibility problem that exists in franchisor — franchisee relationships. It is shown that incentive incompatibility exists with respect to both price and quality. Several contractual mechanisms designed to mitigate the incompatibility problem are examined.     

Current Issues in the Analysis of Commercial Real Estate

This paper identifies and discusses a number of current issues regarding our understanding of commercial real estate markets. These issues include: 1) accurate estimation of the quantity and location of our nation's commercial space; 2) an understanding of the linkage between the space and capital markets for commercial real estate; 3) identification of the macroeconomic factors that affect the rate of return on commercial property and whether local market factors also affect the rate of return; 4) problems associated with measuring the return characteristics of equity investments in commercial property (including measures of the diversification benefits and inflation-hedging abilities of this asset class); 5) a better understanding of rental markets, including good measures of changes in effective rents over time; and 6) examination of the rationale for ownership of commercial space by corporate users. This paper reviews recent research related to these questions and suggests future research that should prove to be fruitful.     

Action Teams That Work

A growing awareness of workplace hazards and identification of airborne contaminants, coupled with a changing safety and health regulatory environment, created an unexpected demand for new and innovative respirators in the early 1980s. 3M's Occupational Health and Environmental Safety Division broke new ground by taking the team concept further than ever before in the company. The division's Action Teams successfully designed, built and introduced products in less than half the time it would have taken previously. Robert Hershock, Charles Cowman and Douglas Peters describe how 3M learned important lessons about team selection, training, performance and motivation, the importance of project sponsors, and the role of middle management.