market heterogeneity and the determinants of paris apartment prices a quantile regression approach in this paper the heterogeneity of the paris apartment market is addressed for this purpose quantile regression is applied with market segmentation based on price deciles and the hedonic pri

a new decision rule for lateral transshipments in inventory systems this paper deals with a single echelon inventory system consisting of a number of parallel local warehouses facing compound poisson demand there are standard holding and backorder costs as well as ordering costs at all warehouses normally the warehouses replenish from an outside supplier however lateral transshipments between the warehouses are also possible such transshipments take no time but incur additional costs when a demand occurs at a warehouse the question is whether the whole demand or part of it should be covered by a lateral transshipment from another warehouse given a set of alternative decisions our decision rule minimizes the expected costs under the assumption that no further transshipments will take place this rule is then used repeatedly as a heuristic a simulation study illustrates how the suggested technique performs under different conditions

quality adjusted cost functions and policy evaluation in the nursing home industry proper evaluation of cost quality trade offs inherent in regulatory policy requires identifying the structure of production from the behavioral response of quality to the policy change however estimating the structure of production with endogenous quality is difficult because of both measurement problems and data availability we develop a simple method for identifying and estimating cost functions in the presence of endogenous and unobserved quality using this method we estimate that a quality adjusted cost function for nursing homes treating quality as exogenous yields seriously misleading estimates of marginal cost and economies of scale we then used the parameter estimates to evaluate the cost quality trade off in nursing home regulatory policy

enhanced lateral transshipments in a multi location inventory system in managing an inventory network two approaches to the pooling of stock have been proposed reactive transshipments respond to shortages at a location by moving inventory from elsewhere within the network while proactive stock redistribution seeks to minimize the chance of future stockouts this paper is the first to propose an enhanced reactive approach in which individual transshipments are viewed as an opportunity for proactive stock redistribution we adopt a quasi myopic approach to the development of a strongly performing enhanced reactive transshipment policy in comparison to a purely reactive approach to transshipment service levels are improved while a reduction in safety stock levels is achieved the aggregate costs incurred in managing the system are significantly reduced especially so for large networks moreover an optimal policy is determined for small networks and it is shown that the enhanced reactive policy substantially closes the gap to optimality

two interval inventory allocation policies in a one warehouse n identical retailer distribution system for a system of n identical retailers we construct a model for determining warehouse inventory allocation policies which minimize system lost sales per retailer between system replenishments an allocation policy is specified by a the number of withdrawals from warehouse stock b the intervals between successive withdrawals c the quantity of stock to be withdrawn from the warehouse in each interval and d the division of withdrawn stock among the retailers we show that in the case of two withdrawals available stock in each interval should be divided to balance retailer inventories we also develop an infinite retailer model and use it to determine two interval allocation heuristics for n retailer systems simulation tests suggest that the infinite retailer heuristic policies are near optimal for as few as two retailers simulation tests indicate that the risk pooling benefits of allocation policies with two well chosen intervals are comparable to those of base stock policies with four equal intervals

informality property rights and poverty in china s favelas in this study of households living in informal settlements in three principal chinese cities we analyze the associations between informality property rights and poverty we propose that informality can be understood in terms of property rights presence absence strength completeness and ambiguity drawing on the property rights entitlements theories of sen de soto ostrom alchian and coase we refine a list of property rights effects that can be tested empirically using a household questionnaire survey of 1 208 respondents from a representative sample of 60 urban villages in beijing shanghai and guangzhou we use robust regression models to detect statistical relationships between household performance on six poverty domains as a function of four property rights domains controlling for income human capital and other influences we find evidence for what we call sen effects and de soto effects our models show that some property rights are associated with lower poverty indicators but we also find evidence to show that the absence weakness or ambiguity of property rights also reduce poverty indicators on particular domains through what we assume to be a substitution effect informal settlements permit poorer household to live at lower costs than is usually or officially acceptable and thus spend more on other welfare enhancing expenditures the distribution of property rights determines the size distribution and impacts of these trade offs and shapes the economic and social performance of informal settlements

mechanisms for incentive regulation theory and experiment this article develops the theoretical properties of a new incentive mechanism for regulating a monopoly seller and reports the results of laboratory experimental tests of its behavioral properties the design of the new mechanism draws upon the results of our earlier experimental research on the behavioral properties of two other mechanisms one by loeb and magat 1979 and a second by finsinger and vogelsang 1981 as with finsinger and vogelsang the new mechanism weakens loeb and magat s requirement that regulators have complete knowledge of market demand the new mechanism however is not subject to the destabilizing profit destroying cycles of nonoptimal behavior observed with finsinger and vogelsang s

a semi markov decision problem for proactive and reactive transshipments between multiple warehouses abstract lateral transshipments are an effective strategy to pool inventories we present a semi markov decision problem formulation for proactive and reactive transshipments in a multi location continuous review distribution inventory system with poisson demand and one for one replenishment policy for a two location model we state the monotonicity of an optimal policy in a numerical study we compare the benefits of proactive and different reactive transshipment rules the benefits of proactive transshipments are the largest for networks with intermediate opportunities of demand pooling and the difference between alternative reactive transshipment rules is negligible

informality and poverty in ecuador this paper uses national representative data from the ecuadorian family expenditure survey to study the determinants of poverty and informality in the country taking into account the two way relationship between these two phenomena the main contribution of this paper is to present new empirical evidence on this relationship for a developing country where more than 60 of workers are in the informal sector the results support the view of a heterogeneous informal market in which informal work is both a demand led phenomenon and a voluntary and primarily supply led form of employment

land tenure arrangements and rural urban migration in china summary obstacles to internal migration in china contribute to inefficiency inequality and land degradation academic and policy debate has primarily focused on discrimination against rural migrants on arrival in urban areas meanwhile barriers to migration out of rural areas have received less attention this paper examines the role of incomplete rural property rights in the migration decisions of rural households we examine the relationship between tenure insecurity and restrictions on land rentals and participation in outside labor markets the results indicate that tenure insecurity reduces migration this relationship is particularly pronounced on forest land which has implications for the conservation of recently replanted forest areas

the government procurement agreement implications of economic theory this paper analyzes the provisions of the new agreement on government procurement gpa drawing insights from trade theory and recent developments in the economics of information and law a central conclusion is that in a world where imperfectly informed procurers purchase from imperfectly competitive firms on behalf of imperfectly informed tax payers it is not easy to devise rules which would be optimal in all situations nevertheless the non discriminatory provisions of the gpa seem to approximate closely the rules which would maximize global welfare a significant benefit of the gpa is in helping to overcome national agency problems in procurement by creating mechanisms for reciprocal international monitoring supported by multilateral enforcement there is however scope for improvement first the gpa does not equip bidders for government contracts to vault over trade restrictions so the creation of genuine international competition for government procurement remains crucially dependent on the liberalization of trade secondly weaknesses remain in the enforcement mechanism these include the low level of compensation to a successful challenger the absence of restrictions on settlements and the lack of provision for challenge and review of bail outs the paper proposes certain improvements this abstract was borrowed from another version of this item

risk pooling along a fixed delivery route using a dynamic inventory allocation policy this paper examines static and dynamic policies for replenishing and allocating inventories amongst n retailers located along a fixed delivery route each retailer faces independent normally distributed period demand and incurs a proportional holding or backorder cost on end of period net inventory a warehouse places a system replenishment order every m periods which is received after a fixed leadtime of t periods immediately upon receipt a delivery vehicle leaves the warehouse with the system replenishment quantity and travels to the retailers along a fixed route with fixed leadtimes between successive retailers the warehouse holds no inventory under the static policy allocations are determined for all retailers simultaneously at the moment the delivery vehicle leaves the warehouse under the dynamic policy allocations are determined sequentially upon arrival of the delivery vehicle at each retailer our major analytical results under appropriate dynamic static allocation assumptions are 1 optimal allocations under each policy involve bringing each retailer s normalized inventory to a corresponing normalized system inventory 2 optimal system replenishments are base stock policies 3 the minimum expected cost per cycle of dynamic static policy can be derived from an equivalent dynamic static composite retailer given this we prove that the risk pooling incentive a simple measure of the benefit from adopting dynamic allocation policies is always positive our simulation tests confirm that dynamic allocation policies yield lower costs than static policies regardless of whether or not their respective allocation assumptions are valid however the magnitude of the cost savings is very sensitive to some system parameters

pretia ex machina prices and process in long term contracts aimong the primary motives for writing contracts identified in both the law and economics literatures is the desire to protect against the hazards inherent to exchange where one or both parties have invested in reliance or relationship specific assets in support of the transaction because such investments have a higher value in their intended than in their next best use parties have an incentive to engage in haggling or other forms of opportunism in hopes of influencing the distribution of the resulting quasi rents contracts promote efficiency by securing the distribution of those rents ex ante thereby avoiding costly repetitive bargaining over the terms of trade and reducing the risk for each party of relying on the performance of the other in reality this description of the role and functioning of contracting is oversimplified as a number of legal and economic scholars have emphasized contracts are not the precise mechanically enforced documents often encountered in economic theory 2 indeed contracts are extremely

exploring spatial dynamics with land price indexes the purpose of this study is to explore the within region spatial dynamics of appreciation and depreciation rates using three different representations of geographical space mean value indexing methods are used to construct global land price indexes sub market land price indexes and local land price indexes using transaction price data for vacant residential land within the city of hamilton ontario between 1995 and 2003 the results are validated against statistics canada s series of new housing price indexes followed by a comparison of the relative performance of the three geographical representations of land price indexes the results indicate that the mean value indexing methods are robust although subject to outliers and sample selection bias and clearly illustrate the spatial dynamics of annual appreciation and depreciation rates across the study area the results also underscore the need for regular surveillance of the spatial dynamics of urban land markets

china s uneven progress against poverty while the incidence of extreme poverty in china fell dramatically over 1980 2001 progress was uneven over time and across provinces rural areas accounted for the bulk of the gains to the poor though migration to urban areas helped the pattern of growth mattered rural economic growth was far more important to national poverty reduction than urban economic growth agriculture played a far more important role than the secondary or tertiary sources of gross domestic product gdp rising inequality within the rural sector greatly slowed poverty reduction provinces starting with relatively high inequality saw slower progress against poverty due both to lower growth and a lower growth elasticity of poverty reduction taxation of farmers and inflation hurt the poor external trade had little short term impact

an evaluation of medicaid selective contracting in california this study used 1982 1986 data on 262 private community hospitals to evaluate the effects of selective contracting for inpatient services by california s medicaid program selective contracting by medicaid significantly reduced the rate of inflation in average costs per admission and per patient day while slightly increasing average lengths of patient stays private sector contracting also reduced cost inflation rates significantly and caused small non significant reductions in lengths of stays hospital savings in 1986 due to medicaid selective contracting were 836 million 7 6 of what hospital expenditures would have been in the absence of contracting

approximate dynamic programming for lateral transshipment problems in multi location inventory systems abstract companies commonly allocate their inventories across multiple locations based on their historical sales rates however random fluctuations in customer purchases such as those caused by weather conditions and other external factors might cause significant deviations from expected demand leading to excess stock in some locations and stockouts in others to fix this mismatch companies often turn to lateral transshipments e g the movement of stock between locations of the same echelon in this paper we examine multi location inventory systems under periodic review with multiple opportunities for proactive transshipments within one order cycle if stockouts occur demand is lost with no opportunity to backorder the objective of our model is to find an optimal policy that indicates the sources and the destinations of transshipments as well as the number of units to maximise the profit of the network we create a dynamic program that can in principal be solved to optimality using bellman s equation however the size of the state and decision spaces makes it impossible to find the optimal policy for real world sized problem instances thereby we use forward approximate dynamic programming to find a near optimal transshipment policy finally we conduct an extensive numerical study to gauge the performance of our transshipment policy for small size instances we compare our policy to the optimal one for larger scale instances we consider other practically oriented heuristics our numerical experiments show that our proposed algorithm performs very well compared to state of the art methods in the literature

the routed inventory pooling problem with three non identical retailers abstract we consider a single period inventory problem with three non identical retailers in which items can be pooled at a predetermined point in time since multiple items are often pooled with a single visit to each retailer we use a predetermined shortest route for redistribution we derive cost expressions for this routed pooling policy as well as for the no pooling and complete pooling policies which serve as benchmarks in a numerical investigation we analyze how much of the pooling benefits can be captured if the route for redistribution is fixed furthermore we investigate how stock is distributed among retailers at the beginning of the period and we look into the influence of a retailer s size and position in the route on expected costs

regulation by price adjustment the regulatory price adjustment process originally proposed by vogelsang and finsinger has been shown to be vulnerable to strategic manipulation by the regulated firm this article proposes several modifications to that scheme which improve its performance and broaden its applicability inclusion of a monopoly franchise market and the firm s past prices and earnings in the price adjustment constraints are shown to ensure efficient production by the firm and convergence to ramsey prices regardless of the firm s cost structure

modelling spatial structures in local housing market dynamics a multilevel perspective there has been a long history of research into the development and estimation of hedonic house price models there is however a discrepancy between the empirical and theoretical approaches to this research a major issue lies in the integration of the conceptual and theoretical models of local housing markets with the context insensitive nature of the standard hedonic model specification this paper explores this inconsistency by using multilevel modelling to move towards a more empirically and conceptually appealing specification of the hedonic house price model it uses price data from cardiff to investigate how a multilevel approach can explicitly incorporate the spatial structures of housing market dynamics and the ad hoc nature of the valuation process the paper concludes that successful empirical analysis depends upon a clear theoretical understanding of the processes under investigation

optimal joint replenishment and transshipment policies in a multi period inventory system with lost sales mismatch between supply and demand when the uncertainty of the demand is high and the supply lead time is relatively long such as seasonal good markets can result in high overstocking and understocking costs in this paper we propose transshipment as a powerful mechanism to mitigate the mismatch between the supply and demand we consider a finite horizon multi period inventory system where in each period two retailers have the option to replenish their inventory from a supplier if there is any supply or via transshipment from the other retailer each retailer observes nonnegative stochastic demand with general distribution in each period and incurs overstocking understocking costs as well as costs for replenishment and transshipment that may be time dependent we study a stochastic control problem where the objective is to determine the optimal joint replenishment and transshipment policies so as to minimize the total expected cost over the season we characterize the structure of the optimal policy a

rural urban disparities in india and china abstract this paper compares rural urban disparities in china and india in light of differences in the following indicators income and consumption deposit to credit ratios and agricultural and industrial productivity access to such public services as health are also considered reasons for disparities are sought in government policies affecting agricultural terms of trade credit and rural to urban migration the paper concludes that the chinese economy during the mao zedong period was much more egalitarian than the indian but the case is less clearcut for the deng xiaoping period

dynamic balancing of inventory in supply chains abstract we consider the dynamic version of the classic problem of allocation of inventories to a set of retailers to rectify the imbalance of inventories amongst them while most research is focussed on analyzing different allocation strategies with a predetermined time of shipment static policy we investigate the benefit of using real time demand inventory information to schedule rebalancing shipments in a retail network we model the dynamic rebalancing problem that has two decisions the timing of the balancing shipments and determination of the new stocking levels at the retailers as a dynamic program dp we obtain structural properties for the optimal allocation rebalancing and timing strategies we also present conditions under which a greedy heuristic to decide how much to ship from one retailer to another is optimal the dp for determining the optimal timing and quantity of shipments has a very large state space we present an algorithm to solve this dp efficiently we also provide a heuristic solution procedure to the dynamic problem that performs very close to optimal numerical results show that dynamic allocation policies can lead to substantial benefits over the static policy especially in systems in which the starting inventories at the retailers are balanced or when high service levels are required

an empirical investigation of procurement contract structures this article presents a model of procurement contracting with asymmetric cost information and investigates whether two of the model s predictions are consistent with actual contracts between hospitals and california s medicaid program the article first tests for the presence of a fixed price payment region where medicaid s payments are independent of hospitals actual but unobservable production costs and then tests whether the size of the fixed price region depends upon expectations about hospitals costs to conduct these tests the article must first estimate hospitals unobservable costs attributable to medicaid patients the article finds evidence of a fixed price region but cannot confirm that the size of the fixed price region depends upon expectations about hospitals costs

stocking decisions for low usage items in a multilocation inventory system this research shows that organizations with a number of sister plants warehouses or other stocking points can profit from the concept of proactive use of transshipments as an element of their inventory control policy for certain types of parts employing transshipments can significantly reduce the total inventory needed throughout the entire collection of stocking points the study is motivated by a real life situation involving a large utility company having 29 power generating plants in five southeastern states where there are thousands of parts that are commonly used at multiple plants at present each plant operates independently and maintains enough stock to meet its own requirements transshipments take place between plants whenever there is an emergency requirement for a part but no explicit consideration is given to this effect while deciding on stocking levels at different plants in the case we examined by setting stocking levels to explicitly take account of transshipments total system cost could be reduced by about 70 over the company s decentralized policy in general this work considers a single echelon n location continuous review inventory system in which complete pooling of stock is permitted among the locations a model is developed for slow moving expensive and consumable parts that are common to two or more locations a one for one ordering policy and queueing theory allow development and solution of a system of equations for the probability distribution of net inventory at each location a heuristic procedure is also developed to determine cost effective stocking levels actual data from the utility company are used to demonstrate the applicability of the model savings achieved as a result of pooling are reported

spatial heterogeneity in hedonic house price models the case of austria modelling spatial heterogeneity sh is a controversial subject in real estate economics single family home prices in austria are explored to investigate the capability of global and locally weighted hedonic models even if regional indicators are not fully capable to model sh and technical amendments are required to account for unmodelled sh the results emphasise their importance to achieve a well specified model due to sh beyond the level of regional indicators locally weighted regressions are proposed mixed geographically weighted regression mgwr prevents the limitations of fixed effects by exploring spatially stationary and non stationary price effects besides reducing prediction errors it is concluded that global model misspecifications arise from improper selected fixed effects reported findings provide evidence that the sh of implicit prices is more complex than can be modelled by regional indicators or purely local models the existence of both stationary and non stationary effects implies that the austrian housing market is economically connected

provider selection bargaining and utilization management in managed care i introduction the managed care industry is extraordinarily dynamic one of the earliest examples of managed care is the kaiser prepaid group health plan which contracted exclusively with the permanente group to supply health care to a group of beneficiaries the types of contractual arrangements used in managed care plans have since evolved into so many other forms that it is difficult to classify relationships using traditional typologies e g staff versus group or network model health maintenance organization hmo the managed care organization may own the hospital and or physician group the hospital may own the managed care organization or the managed care organization may contract with hospitals and physician groups 1 the large variety of institutional arrangements known as managed care make it necessary for health economists to look inside the black box of managed care and examine not only whether managed care reduces expenditures but also how expenditures are reduced what is relevant for this analysis is not whether a managed care organization calls itself an hmo a preferred provider organization ppo independent physician association ipa or another acronym but how managed care affects expenditures and quality of care managed care organizations generally use three of the tools to reduce expenditures selecting low cost providers bargaining for lower rates and utilization management the economic differences between managed care plans lie in which of these three tools are applied and to what degree thus we can gain insight into modern managed health care by studying the way each of these three components affect cost and utilization this study measures the relative contribution of each managed care tool to changes in aggregate expenditures we study the effect of a managed care program in which there was a change from a fee for service type arrangement to a managed care environment however the concepts and methods in this article can be applied to any situat ion where the network contractual terms or utilization management rules have changed one way that managed care organizations control expenditures and quality of care is to restrict the number of providers in a network we define the effect of selecting certain types of providers as the provider selection effect in other words the provider selection effect is the change in expenditures that can be attributed to the inclusion or exclusion of different providers into the network for example the managed care organization may select providers with a history of less intensive treatment patterns and avoid providers with a history of highly intensive treatment patterns the change in future expenditures that are due to selection of low or high intensity providers is the provider selection effect with respect to utilization similarly the difference in rates at providers before the new rates are bargained is defined as the provider selection effect with respect to price in summary the provider selection effect measures the effect of selecting types of providers on subsequent expenditures it does not measure how rates or utilization patterns change at a given provider over time after providers are selected to be in the network the managed care organization may try to achieve expenditure reductions by bargaining over prices and utilization management changes in reimbursement rates over time for a given provider are defined as the bargaining effect and changes in utilization over time are defined as the utilization management effect the bargaining effect is the change usually reduction in prices that is a result of bargaining with the managed care organization in order to be included in the network although it is possible that managed care organizations negotiate other aspects of the contract our investigation of this industry has revealed that bargaining over prices is by far the most important in terms of changes in expenditure

the new economics of regulation ten years after the new economics of regulation is an application of the principal agent methodology to the contractual relationship between regulators and regulated firms after a critique of the traditional paradigms of regulation from the point of view of information economics a canonical model of regulation under asymmetric information is developed a survey of the main results obtained in the new economics of regulation is then provided in particular concerning the implementation of optimal contracts by a menu of linear contracts the dichotomy between pricing and cost reimbursement rules the auctioning of incentive contracts the dynamics of contracting under limited commitment and the hierarchical problems in regulation empirical implications are then discussed and avenues of further research are described in the conclusion

behavior of the firm under regulatory constraint a recent article by akira takayama discusses an earlier paper by harvey averch and leland l johnson on fair rate of return regulation of public utilities although takayama p 255 agrees with averch and johnson s general conclusions that a firm will tend to increase its investment with the introduction of an active constraint on its rate of return he criticizes the a j argument as being confusing ambiguous and in error takayama then attempts a clarification and presents a new formulation which leads to the a j result quoted above this comment will discuss several of takayama s criticisms in addition to showing that the so called a j effect cannot be derived from the basic assumptions made by both averch and johnson and takayama 1 we will show that the very assumptions used to prove the a j effect by defining the region of x require an assumption that the a j effect exists in the first place

competition and efficiency in the end stage renal disease program abstract estimated coefficients for medical service production or cost functions are subject to a competitive amenity bias which may result in the failure to identify factors that affect economic efficiency our investigation of productivity of dialysis facilities did indeed indicate both the likelihood of bias and some qualitative results these results suggest that it will be difficult to estimate cost and that variation in the level of reimbursement will in competitive markets affect the level of amenity delivered to patients incurred cost amenity and patient well being will all vary positively with the reimbursement level determining the right level of reimbursement requires a policy decision on how much total amenity society wishes to deliver to beneficiaries of public programs

managing inventories with one way substitution a newsvendor analysis abstract this paper presents an insightful approach to analyze two item periodic inventory systems with one way substitution the objective is to minimize the expected total cost per period which consists of expected purchasing costs expected inventory holding costs expected shortage costs and expected adjustment costs this approach helps derive the optimality conditions in both single period and infinite horizon settings and yields useful insights into the impact of substitution on the service level the optimality of a borderline case in which the order up to level of the inflexible item is reduced to zero and the pivotal role of the purchasing cost

monopoly behaviour decentralized regulation and contestable markets an experimental evaluation this study provides a comparative experimental evaluation of several alternative approaches to the single product monopoly problem we contrast incentive compatible decentralized regulatory mechanisms with notions of market contestability in a decreasing cost environment the decentralized regulatory mechanisms are found to be significantly more effective at restraining monopoly power than is allowing direct contestability but the regulatory mechanisms examined require that the regulatory agency know the market demand curve though not the industry cost curve since this is significantly more information than is required to implement direct contestability an interesting tradeoff is suggested does the greater efficiency in monopoly restraint provided by the regulatory mechanism relative to direct contestability outweigh the former s greater informational requirements

poverty and famines an essay on entitlement and deprivation this book focuses on the causes of starvation in general and famines in particular the traditional analysis of famines is shown to be fundamentally defective and the author develops an alternative analysis

traffic congestion accessibility to employment and housing prices a study of single family housing market in los angeles county this study mainly addresses two main questions 1 whether traffic congestion negatively affects single family house price by constraining accessibility to jobs 2 whether congestion effects and

development of standardized indices for measuring house price inflation incorporating physical and locational characteristics the measurement of house price inflation over time is considered and a methodological approach to the problem proposed the measurement technique presented incorporates physical and locational features in the house price model results are presented for regional and uk data over the time period 1983 1 1989 4

emergency lateral transshipments in a two location inventory system with positive transshipment leadtimes abstract we consider a single echelon continuous review inventory system for spare parts with two parallel locations each location faces independent poisson demand and backorders are allowed in this paper we consider the possibility of lateral transshipments between the locations the transshipment leadtime is positive and deterministic and there is an additional cost for making a transshipment we suggest a transshipment policy which is based on the timing of all outstanding orders and develop and solve a heuristic model by using theory and concepts from doubly stochastic poisson processes and also partial differential equations a simulation study indicates that our heuristic works very well and that the relative cost increase of disregarding the transshipment leadtime may be quite high our results also indicate that it is in general worth the effort of reducing the transshipment leadtime even if it is already relatively short

market accessibility and hotel prices in the caribbean the moderating effect of quality signaling factors abstract the purpose of the paper is to investigate the influence of market accessibility on hotel prices and how this influence is moderated by various quality signaling factors such as online user ratings thumbs up recommendation percentage hotel class and chain affiliation using a randomized sample of hotels in the caribbean islands we employ a three level mixed effect linear regression model to investigate the plausible relationship between market accessibility and hotel prices after controlling for unobserved island level and hotel level characteristics the model indicates that in most periods low market accessibility high flight costs leads to lower hotel prices and this influence is mitigated by well established positive reputations as represented by the quality signaling factors our findings imply that hotels should work to increase their reputations to help buffer the impacts of inaccessibility in an effort to increase market accessibility one course of action is to reduce airport landing taxes and fees

resolving the impasse on hospital scale economics a new approach the existence of scale economies in hospitals in important for both public and managerial policy yet production and cost function studies have found conflicting evidence more recently more sophisticated studies have typically found scale diseconomies which is inconsistent with the views of industry participants and observers in the early 1980s california deregulated both private and public health insurance medical which provides a natural laboratory for examining hospital efficiency using stigler s original and multivariate survivor analysis we resolve the conflict in favour of scale economies and reconcile the controversy the survivorship methodology in simple to apply and a useful tool in conjunction with statistical cost and production studies

regulating the anticommons insights from public expenditure theory this article offers a new interpretation of the traditional cournot complements problem or anticommons by using the theory of public goods to gain a perspective on the problem specifically i examine the pricing strategies and regulation of multiple monopolies that produce products which consumers view as perfect complements i show that collusion by the firms increases total social welfare and that the collusion problem can be reinterpreted as a problem of provision of public goods from the point of view of the firms i take this insight further and derive the familiar concepts of the samuelson marginal condition and the ratio equilibrium for the firms i compare these outcomes to the first best solution and then apply incentive compatible mechanisms to strategically implement the pareto superior ratio equilibrium outcome and the optimal marginal cost pricing outcome finally i show how this methodology can be applied to the more familiar cournot model of oligopoly

electricity tariffs under imperfect knowledge of participant benefits the authors consider the problem of establishing tariffs for electrical energy under uncertainty about the value of the energy to the participants a tariff update that achieves welfare maximization asymptotically through successive approximations to the ideal tariff is proposed the successive update of the tariff avoids the need for accurate a priori knowledge of electricity system demand and generation as a function of price the key results are a tariff update algorithm and a proof of local convergence two necessary steps for implementation of practical responsive pricing

a multiechelon inventory model with fixed replenishment intervals this paper develops a new model for studying multiechelon inventory systems with stochastic demand for the model we assume that each site in the system orders at preset times according to an order up to policy that delivery times are deterministic and that the demand processes are stochastic with independent increments we introduce a new scheme for allocating stock in short supply which we call virtual allocation and which permits significant tractability we exercise the model on a set of test problems for two echelon systems to get insight into the structure of good policies the primary findings are that both the central warehouse upper echelon and the retail sites lower echelon should hold safety stock but that most of the safety stock should be at the retail sites consequently the central warehouse will stock out with high probability furthermore we show that the virtual allocation rule is near optimal for the set of test problems

optimal policies for inventory systems with lateral transshipments using lateral transshipments can be beneficial in order to improve service levels and to reduce system costs this paper deals with a single echelon inventory system with two identical locations demands are generated by stationary and independent poisson processes in general if a demand occurs at a location and there is no stock on hand the demand is assumed to be backordered or lost however in this paper lateral transshipments serve as an emergency supply in case of stock out in this paper the rule for lateral transshipments is given while the ordering policies for normal replenishments are optimized the transshipment rule is to always transship when there is a shortage at one location and stock on hand at the other first we assume that the locations apply r q policies for normal replenishments and show that the optimal policies are not necessarily symmetric even though the locations are identical this means that one cannot in general assume that the optimal policy is symmetric under symmetric assumptions second we relax the assumption of r q policies and derive the optimal replenishment policy using stochastic dynamic programming

the price premium for green labelled housing evidence from china the chinese central government introduced the chinese green building label in 2008 which makes china one of the few developing countries with an official rating system of buildings performance in sustainability this paper investigates the existence and magnitude of the price premium associated with this official green label in the residential sector based on a unique data set of green labelled newly built housing projects and their non labelled counterparts from around the country in 2013 an empirical analysis suggests that the labelled housing projects attract a price premium of 6 9 compared with their non labelled counterparts further analysis suggests that this official green label is more effective as a reliable signal of buildings energy efficiency in the chinese context compared with developers self advertised greenness these results provide preliminary evidence that with this official rating system the investment in buildings energy efficiency could be potentially profitable for ho

optimal and approximate policies in multiperiod multilocation inventory models with transshipments this paper examines the effects on the optimal ordering policy and its cost of allowing for interactions among retail outlets specifically transshipments are allowed as recourse actions occurring after demands are realized but before they must be satisfied the resultant savings in holding and shortage costs are balanced against the costs of transshipment a base stock ordering policy is optimal for this model if the final period base stock order up to point is nonnegative then it will be the base stock order up to point for all periods unfortunately it can be found analytically only for two special cases where either the cost parameters are equal at every outlet or there are only two outlets these two special cases are used to validate a heuristic solution technique employing monte carlo integration which is then compared to an easily calculated base policy in order to gauge the contribution of this model the additional savings from using this heuristic policy are significant particularly for problems with many retail outlets and low transshipment costs

a multi level analysis of the variations in domestic property prices southern england 1980 87 it is argued that previous research on spatial variations in domestic property prices has failed to consider the multi level nature of the problem in describing underlying temporal trends and spatial patterns at the macro level it is necessary to take account of the attributes of individual properties at the micro level as an empirical illustration of the general approach a number of models are calibrated for southern england using sample data derived from building society mortgages

the specification of a hospital cost function a comment on the recent literature in the empirical estimation of hospital cost functions two radically different types of specifications have been chosen to date ad hoc forms and flexible functional forms based on neoclassical production theory this paper discusses the respective strengths and weaknesses of both approaches and emphasizes the apparently unreconcilable conflict between the goals of maintaining functional flexibility and keeping the number of variables manageable if at the same time patient heterogeneity is to be adequately reflected in the case mix variables a new specification is proposed which strikes a compromise between these goals and the underlying assumptions are discussed critically

an inventory model with unidirectional lateral transshipments this paper deals with a continuous review inventory system with poisson demand in which lateral transshipments are allowed in case of a shortage at a location another location acts as a supplier if it is possible a common assumption in earlier papers is that transshipments are allowed between all locations this network configuration may however not be the best choice for many reasons one such reason is that it may be difficult to establish contracts between locations regarding the design of the transshipment policy another reason is that a system with many transshipment links is much more complex than a system with few transshipment links in this paper we study a system where transshipments are allowed only in one direction this may be a reasonable policy if the locations have very different backorder lost sales costs our approach is relatively simple and fast and works well in most cases

inventory sharing and rationing in decentralized dealer networks an increasing number of manufacturers have started to pursue a strategy that promotes inventory sharing among the dealers in their distribution network in this paper we analyze a decentralized dealer network in which each independent dealer is given the flexibility to share his inventory we model inventory sharing as a multiple demand classes problem in which each dealer faces his own customer demand with high priority and inventory sharing requests from other dealers with low priority assuming that each dealer uses a base stock and threshold rationing policy for his inventory stocking and inventory sharing decisions we explicitly model the interactions between the dealers through inventory sharing and obtain aclosed form cost function for each dealer based on the steady state distribution of the inventory levels at the two dealers we then provide a detailed supermodularity analysis of the inventory sharing and inventory rationing game in which each dealer has a two dimensional strategy set stocking level and rationing level we show that the full sharing game in which dealers precommit to sharing all of their on hand inventory and the fixed sharing level game in which dealers precommit to sharing a portion of their on hand inventory are supermodular and thus a pure strategy nash equilibrium is guaranteed to exist for the rationing game in which dealers precommit to their stocking levels we show that there exists a dominant strategy equilibrium on the dealers sharing rationing levels finally a comprehensive computational study is conducted to highlight the impact of the manufacturer s incentives subsidies and or transshipment fees on the dealers sharing behavior

farmland rental prices in gm soybean areas of argentina do contractual arrangements matter abstractin this paper we study the determinants of the rental price of farmland in the argentinian pampas in particular we examine the price of lease contracts using a hedonic price model while controlling for other potential sources of variation using firsthand data for 255 plots our results indicate that both short term contracts and contracts with sowing pools push rental prices upwards we also find that soybean yields have a significant impact on land rental prices these results suggest that if argentina intends to protect the enormous natural advantage it has for agricultural production it should consider strictly regulating land rental contracts

regulating a monopolist with unknown costs we consider the problem of how to regulate a monopolistic firm whose costs are unknown to the regulator the regulator s objective is to maximize a linear social welfare function of the consumers surplus and the firm s profit in the optimal regulatory policy prices and subsidies are designed as functions of the firm s cost report so that expected social welfare is maximized subject to the constraints that the firm has nonnegative profit and has no incentive to misrepresent its costs we explicitly derive the optimal policy and analyze its properties in their classic papers dupuit 2 and hotelling 5 considered pricing policies for a bridge that had a fixed cost of construction and zero marginal cost they demonstrated that the pricing policy that maximizes consumer well being is to set price equal to marginal cost and to provide a subsidy to the supplier equal to the fixed cost so that a firm would be willing to provide the bridge this first best solution is based on a number of informational assumptions first the demand function is assumed to be known to both the regulator and to the firm while the assumption of complete information may be too strong the assumption that information about demand is as available to the regulator as it is to the firm does not seem unnatural a second informational assumption is that the regulator has complete information about the cost of the firm or at least has the same information about cost as does the firm this assumption is unlikely to be met in reality since the firm would be expected to have better information about costs than would the regulator as weitzman has stated an essential feature of the regulatory environment i am trying to describe is uncertainty about the exact specification of each firm s cost function in most cases even the managers and engineers most closely associated with production will be unable to precisely specify beforehand the cheapest way to generate various hypothetical output levels because they are yet removed from the production process the regulators are likely to be vaguer still about a firm s cost function 12 p 684 as this observation suggests it is natural to expect that a firm would have better information regarding its costs than would a regulator the purpose of this paper is to develop an optimal regulatory policy for the case in which the regulator does not know the costs of the firm one strategy that a regulator could use in the absence of full information about costs is to give the firm the title to the total social surplus and to delegate the pricing decision to the firm in pursuing its own interests which would then be to maximize the total social surplus the firm would adopt the same marginal cost pricing strategy that the regulator would have imposed if the regulator had

co evolution of gated communities and local public goods gated communities are often seen as steps towards the privatization of the public realm this is too simple a characterization however privately and publicly governed infrastructure and services exist and adapt symbiotically there is little empirical research focusing on the co evolution of private and public neighbourhoods in this paper we focus on a specific question that has not yet been answered does the spatial pattern of privately supplied public goods co evolve with the pattern of publicly supplied public goods we examine this question through a case study of seoul where club residential communities are common enough to test co evolution hypotheses we identify co evolutionary relationships between club goods supplied in condominiums and public goods supplied by municipalities and market we also find evidence of tieboutian intra urban market and show how the substitution of club goods for positive urban externalities seems to weaken the influence of general accessibility on residential loca

balancing retailer inventories this paper examines the optimality of inventory balancing in a one warehouse n retailer distribution system facing stochastic demand for a single product over t successive time intervals in particular we consider the division of predetermined quantities of warehouse stock among retailers in each interval balancing attempts to bring the retailer inventories to the same normalized with respect to first interval demand net inventory level when the demand distribution over the t periods is symmetric with respect to all pairs of retailers and retailer cost over the t intervals is a convex function of the t shipments we show that balancing divisions are optimal the required convexity condition is shown to be satisfied for some familiar cost functions when shortages are backordered and lost however for other cost functions the convexity condition is satisfied under backordering but not under lost sales we also consider the nonidentical retailer demands are not symmetric case and provide examples

a semi markov model with holdout transshipment policy and phase type exponential lead time in this paper a semi markov decision model of a two location inventory system with holdout transshipment policy is reviewed under the assumption of phase type exponential replenishment lead time rather than exponential lead time the phase type exponential lead time more closely approximates fixed lead time as the number of phases increases unlike past research in this area which has concentrated on the simple transshipment policies of complete pooling or no pooling the research presented in this paper endeavors to develop an understanding of a more general class of transshipment policy in addition we propose an effective method to approximate the dynamic holdout transshipment policy