baseline value specification and sensitivity analysis in multiattribute project portfolio selection abstract a key issue in applying multi attribute project portfolio models is specifying the baseline value a parameter which defines how valuable not implementing a project is relative to the range of possible project values in this paper we present novel baseline value specification techniques which admit incomplete preference statements and unlike existing techniques make it possible to model problems where the decision maker would prefer to implement a project with the least preferred performance level in each attribute furthermore we develop computational methods for identifying the optimal portfolios and the value to cost based project rankings for all baseline values we also show how these results can be used to i analyze how sensitive project and portfolio decision recommendations are to variations in the baseline value and ii provide project decision recommendations in a situation where only incomplete information about the baseline value is available

assessing the global poverty effects of antimicrobial resistance abstract as a result of antimicrobial resistance amr economies will experience an increase in mortality reduced productivity for labor and the livestock sector and increased health care costs this paper assesses the potential global poverty impacts of amr using a unique macro micro framework to estimate poverty effects of amr price wage and employment results from a dynamic multi country multi sector computable general equilibrium cge model are used in a microsimulation model that integrates household surveys from 104 countries the analysis in this paper advances other studies of amr in two ways 1 it links macro results to a microsimulation model to provide insight on poverty impacts for the world economy and countries of different income levels and 2 it uses a global multi sector model rather than an aggregate global model to generate macroeconomic results with structural details for capturing the economy wide impact within countries and the spread across countries via trade flows relative to a world without amr the progression of antimicrobial resistance is expected to make it more difficult to eliminate extreme poverty potentially adding 24 1 million people to become extremely poor of whom 18 7 million live in low income countries the expected losses during 2015 50 may sum to 85 trillion in gross domestic product and 23 trillion in global exports in present value by 2050 the global gross domestic product could deviate negatively by 3 8 percent from the baseline in the worst case scenario considered because it is a global public bad the optimal policy response will require global cooperation the poverty outcomes induced by amr in all country groups will deteriorate with short sighted isolationist policies moreover assistance from high income countries to improve the economic resiliency of lower income countries will also benefit the higher income countries and world economy in general

unemployment in south africa the nature of the beast abstract unemployment in south africa is so widespread that it demands an explanation this paper examines a central question about south african unemployment why do the unemployed not enter the informal sector as is common in other developing countries the data do not support the idea that unemployment is largely voluntary the policy implications that government should diminish labor market segmentation and the obstacles to entering the productive informal sector may be relevant also to other developing countries with high unemployment

economic implications of antibiotic resistance in a global economy this paper concerns the economic implications of antibiotic resistance in a global economy the global economy consists of several countries where antibiotic consumption creates a stock of bacteria which is resistant to antibiotics this stock affects the welfare in all countries because of the risk that resistant bacterial strains may be transmitted the main purpose of the paper is to compare the socially optimal resource allocation with the allocation brought forward by the decentralized market economy in addition a dynamic pigouvian tax designed to implement the globally optimal resource allocation is presented

international risk cycles abstract recent work in international finance suggests that exchange rate puzzles can be accounted for if 1 aggregate uncertainty is time varying and 2 countries have heterogeneous exposures to a world aggregate shock we embed these features in a standard two country real business cycle framework and calibrate the model to equity risk premia in low and high interest rates countries unlike traditional real business cycle models our model generates volatile exchange rates a large currency forward premium excess comovement of asset prices relative to quantities and an imperfect correlation between relative consumption growth and exchange rates our model implies however that high interest rate countries have smoother quantities equity returns and interest rates than low interest rate countries contrary to the data

determinants of dynamics in the world city network 2000 2004 this article presents an analysis of the determinants of connectivity change in the world city network wcn drawing on the theoretical research of saskia sassen and the subsequent empirical research of the globalization and world cities gawc group connectivity in the wcn is measured through the networked location strategies of globalised service firms based on a calculation of the total connectivity of 220 cities across the world for 2000 and 2004 a measurement of connectivity change is produced for this time period this measure of connectivity change is then used as the dependent variable in a linear regression model through which are tested a number of hypotheses concerning the determinants of connectivity change the study analyses wcn change both in general and in sectoral terms and also examines how the prior presence of service firms impacts connectivity change

modeling project preferences in multiattribute portfolio decision analysis abstract when choosing a portfolio of projects with a multi attribute weighting model it is necessary to elicit trade off statements about how important these attributes are relative to each other such statements correspond to weight constraints and thus impact on which project portfolios are potentially optimal or non dominated in view of the resulting set of feasible attribute weights in this paper we extend earlier preference elicitation approaches by allowing the decision maker to make direct statements about the selection and rejection of individual projects we convert such project preference statements to weight information by determining the weights for which i the selected project is included in all potentially optimal or non dominated portfolios or ii the rejected project is not included in any potentially optimal or non dominated portfolio we prove that the two complementary selection rules will exclude exactly the same set of weights however analyses that apply the dominance structure often lead to multiple mutually exclusive feasible weight sets and therefore the approach based on potential optimality is more relevant for practical decision analysis we also propose ex ante value of information measures to guide the elicitation of project preference statements and illustrate our results by analyzing a real case on the selection of infrastructure maintenance projects

latin american cities and globalisation change and permanency in the context of development expectations some interesting changes have been taking place in the urbanisation processes of latin american countries in the past few decades some of which are definitely related to global processes the empirical evidence of this relation is hard to pin down due to the lack of data sources but in this paper it is suggested that the growth in volume and diversity of mobility relations between cities can be indicators of an overlapping of urban phenomena and global processes a diachronic analysis 1970 2008 of latin american air transport connectivity is used to evaluate the growth and the degree of cohesion of the internal relational systems and changes and continuities in the external relational systems even though air transport is an indicator to be complemented with other indicators when analysing global relations the results indicate a continuation of existing latin american structures centralism and polarisation and the emergence of new forms of dependence tourism and migration which should not be ove

structuring resource allocation decisions a framework for building multi criteria portfolio models with area grouped options multi criteria portfolio modelling has been extensively employed as an effective means to allocate scarce resources for investment in projects when considering costs benefits and risks some of these modelling approaches allow the grouping of projects into organisational areas thus also supporting the decision of resource allocation among organisational units in a way that is collectively efficient for the organisation however structuring in practice a portfolio model using this latter type of approach is not a trivial task how should areas be defined where should new projects be included how should one define the criteria to evaluate performance as far as we know there is very little indication in the operational research and decision sciences literatures on how to structure this type of model this paper suggests different ways to structuring portfolio models where projects are divided into areas and evaluated by multiple criteria and illustrates their use in two action research projects drawing on these experiences it then suggests a general framework for the structuring of such models in practice directions for future research are also identified

wage subsidy and labor market flexibility in south africa in this paper the authors use a highly disaggregate general equilibrium model to analyze the feasibility of a wage subsidy to unskilled workers in south africa isolating and estimating its potential employment effects and fiscal cost they capture the structural characteristics of the labor market with several labor categories and substitution possibilities linking the economy wide results on relative prices wages and employment to a micro simulation model with occupational choice probabilities in order to investigate the poverty and distributional consequences of the policy the impact of a wage subsidy on employment poverty and inequality in south africa depends greatly on the elasticities of substitution of factors of production being very minimal if unskilled and skilled labor are complements in production the desired results are attainable only if there is sufficient flexibility in the labor market although the impact in a low case scenario can be improved by supporting policies that relax the skill constraint and increase the production capacity of the economy especially towards labor intensive sectors the gains from a wage subsidy are still modest if the labor market remains very rigid

preference programming for robust portfolio modeling and project selection in decision analysis difficulties of obtaining complete information about model parameters make it advisable to seek robust solutions that perform reasonably well across the full range of feasible parameter values in this paper we develop the robust portfolio modeling rpm methodology which extends preference programming methods into portfolio problems where a subset of project proposals are funded in view of multiple evaluation criteria we also develop an algorithm for computing all non dominated portfolios subject to incomplete information about criterion weights and project specific performance levels based on these portfolios we propose a project level index to convey i which projects are robust choices in the sense that they would be recommended even if further information were to be obtained and ii how continued activities in preference elicitation should be focused the rpm methodology is illustrated with an application using real data on road pavement projects

scenario based portfolio selection of investment projects with incomplete probability and utility information abstract in the selection of investment projects it is important to account for exogenous uncertainties such as macroeconomic developments which may impact the performance of projects these uncertainties can be addressed by examining how the projects perform across several scenarios but it may be difficult to assign well founded probabilities to such scenarios or to characterize the decision makers risk preferences through a uniquely defined utility function motivated by these considerations we develop a portfolio selection framework which i uses set inclusion to capture incomplete information about scenario probabilities and utility functions ii identifies all the non dominated project portfolios in view of this information and iii offers decision support for rejection and selection of projects the proposed framework enables interactive decision support processes where the implications of additional probability and utility information or further risk constraints are shown in terms of corresponding decision recommendations

product differentiation and the treatment of foreign trade in computable general equilibrium models of small economies this paper examines the treatment of exports and imports and external closure rules adopted in recent single country computable general equilibrium models of small economies the paper presents a simple one sector analytic model which captures the major features of the multi sector counterpart used in applied models the paper derives graphical and algebraic solutions to the model and shows that unlike some earlier external closures this one gives rise to a well behaved price taking economy the model is also useful to illustrate the role of elasticities in popular trade theoretic models that include traded and non traded goods

assessing the macroeconomic impact of a healthcare problem the application of computable general equilibrium analysis to antimicrobial resistance there is a positive relationship between the health of a nation and its economic prosperity however in evaluating health care economists typically concentrate on the economic impact only to the health care sector which may mis specify the social costs and benefits of a disease or intervention this paper demonstrates the value of using a macroeconomic approach to modelling a major health problem using the context of antimicrobial resistance and the application of the computable general equilibrium technique this approach is described in detail and its added value demonstrated in the case of amr

optimal strategies for selecting project portfolios using uncertain value estimates abstract practically all organizations seek to create value by selecting and executing portfolios of actions that consume resources typically the resulting value is uncertain and thus organizations must take decisions based on ex ante estimates about what this future value will be in this paper we show that the bayesian modeling of uncertainties in this selection problem serves to i increase the expected future value of the selected portfolio ii raise the expected number of selected actions that belong to the optimal portfolio ex post and iii eliminate the expected gap between the realized ex post portfolio value and the estimated ex ante portfolio value we also propose a new project performance measure defined as the probability that a given action belongs to the optimal portfolio finally we provide analytic results to determine which actions should be re evaluated to obtain more accurate value estimates before portfolio selection in particular we show that the optimal targeting of such re evaluations can yield a much higher portfolio value in return for the total resources that are spent on the execution of actions and the acquisition of value estimates

selecting a portfolio of solar energy projects using multiattribute preference theory this article reports a procedure developed to assist the u s department of energy in selecting a portfolio of solar energy applications experiments the procedure has also been used in other government procurements and appears to be applicable in a variety of project funding processes the technical quality of each proposed applications experiment was summarized through the use of multiple evaluation measures or attributes these were combined into a single index of the overall technical quality of an experiment through the use of a multiattribute utility function recently derived results in measurable value theory were applied to derive an index of the overall technical quality of a portfolio of experiments budgetary and programmatic issues were handled through the use of constraints this approach allowed the portfolio selection problem to be formulated as an integer linear program details of the application are presented including a discussion of the data requirements and assessment procedure used the portfolio selection procedure was successfully applied and variations of it have been successfully used in four other solar energy procurements

adjustable robustness for multi attribute project portfolio selection abstract robust portfolio modeling rpm supports multi attribute project portfolio selection with uncertain project scores and decision maker preferences by determining non dominated portfolios for all possible realizations of uncertain parameters decision recommendations produced by rpm may prove too conservative for real life decision problems we develop a methodology to reduce the set of possible realizations by limiting the number of project scores that may simultaneously deviate from their most likely value by adjusting this limit decision makers can choose desired levels of conservatism our approach also allows to capture dependencies among project scores as well as uncertainty in portfolio constraints

measurement issues in the evaluation of projects in a project portfolio abstract a common problem arising in many domains is how value the benefits of projects in a project portfolio recently there has been some attention given to a decision analysis practice whereby analysts define a value function on some criterion by setting 0 as the value of the worst project in particular clemen and smith have argued this practice is not sound as it gives different results from the case where projects are priced out and makes a strong implicit assumption about the value of not doing a project in this paper we underscore the criticism of this way of using value functions by showing it can lead to a rank reversal we provide a measurement theoretic account of the phenomenon showing that the problem arises from using evaluating projects on an interval scale such as a value scale whereas to guard against such rank reversals benefits must be measured on at least a ratio scale seen from this perspective we discuss how the solution proposed by clemen and smith of reformulating the underlying optimisation problem to allow for explicitly non zero values addresses the issue and explore in what sense it may be open to similar problems in closing we discuss what lessons from practice may be drawn from this analysis focussing on settings where the clemen and smith proposal may not be the most natural way of modelling

prospective analysis of a wage subsidy for cape town youth abstract persistently high youth unemployment is one of the most pressing problems in south africa we prospectively analyze an employer wage subsidy targeted at youth a policy recently enacted by the south african government to address the issue recognizing that a credible estimate of the policy s impact requires a model of the labor market that itself generates high unemployment in equilibrium we estimate a structural search model that incorporates both observed heterogeneity and measurement error in wages using the model to simulate the policy we find that a r1000 month wage subsidy paid to employers leads to an increase of r596 in mean accepted wages and a decrease of 12 percentage points in the share of youth experiencing long term unemployment

a regional dynamic general equilibrium model of alternative climate change strategies outcomes and noncooperative equilibria this study finds that cooperative policies show much higher levels of emissions reductions than do noncooperative strategies that there are substantial differences in the levels of controls in both the cooperative and the noncooperative policies among different countries and that high income countries may be the major losers from cooperation jel h41 q4 q2 q20

a review of the stern review on the economics of climate change how much and how fast should we react to the threat of global warming the stern review argues that the damages from climate change are large and that nations should undertake sharp and immediate reductions in greenhouse gas emissions an examination of the review s radical revision of the economics of climate change finds however that it depends decisively on the assumption of a near zero time discount rate combined with a specific utility function the review s unambiguous conclusions about the need for extreme immediate action will not survive the substitution of assumptions that are consistent with today s marketplace real interest rates and savings rates

selecting a portfolio of nonhomogeneous r d proposals abstract this article reports a procedure developed to assist the u s department of energy in the selection of a portfolio of proposals addressing the design and manufacture of components of solar photovoltaic arrays and complete photovoltaic systems considerations such as the relative importance of the different components in the overall effort compatibility of the proposed designs and budgetary and programmatic issues were complicating factors the technical quality of each proposal was represented by multiple evaluation measures these were combined into a single index through the use of multi attributeutility function indices representing the relative importance of the various components were then developed and results in measurable value theory were applied to derive an index of technical quality of a portfolio of proposals the problem was then formulated as an integer program it was solved by using an interactive branch and bound code that allowed for sensitivity analysis before selecting the portfolio of proposals for funding the procedure was successfully applied to funding a portfolio of proposals aimed at reducing the cost of producing photovoltaic arrays and to several other government sponsored procurements

intercity relations and globalisation the evolution of the global urban hierarchy 1981 2007 how is the world city system changing in the context of globalisation this question is addressed using data on the headquarter and branch locations of the world s 500 largest multinationals the paper employs techniques developed for the analysis of networks to evaluate the more than 6300 cities that are linked together by such firms in terms of their point centrality and using blockmodelling techniques in terms of the positions they occupy and roles that they play in the system the analysis indicates that the world city system is in the midst of substantial restructuring and that it is changing in such a way as to concentrate power in a small number of cities however in contrast to some accounts support is not found for the idea that globalisation is generating a new geography of inequality at the level of intercity relations