adaptation to electricity crisis businesses in the 2011 great east japan triple disaster abstract electricity crises can spur improvements in electricity conservation that would be unachievable under normal circumstances this paper investigates how businesses adapted to electricity shortages following the march 11 2011 great east japan earthquake tsunami and nuclear disaster in summer 2011 mandatory and voluntary electricity conservation measures affected nearly all of japan and peak hour electricity consumption was reduced by a remarkable 18 in the tokyo region using statistical data from 14 business surveys conducted in 2011 and 2012 this paper identifies patterns with regard to type of adaptation conservation requirements economic sector and timeframe results indicate that behavioral adaptations e g reduction of illumination or air conditioning were much more common than schedule adaptations e g shifting production times or hardware adaptations e g installing energy efficient devices or private generators adaptation patterns were very similar between mandatory and voluntary conservation areas manufacturing companies were more likely to implement schedule adaptations than other companies certain types of adaptations persisted into 2012 especially reduction of illumination and air conditioning and installation of energy efficient devices these insights may be useful for informing electricity conservation policies in non crisis contexts

co firing coal with wood pellets for u s electricity generation a real options analysis abstract in contrast to eu u s electric utilities are not employing the bioenergy technology of co firing wood pellets with coal this difference in employment patterns is explored within a real options analysis roa for possible u s utilization of wood pellets considering fuel price series from 2009 to 2014 for analysis these series are divided into two sub periods based on different market conditions infancy 2009 2011 and substitution 2012 2014 roa indicates co firing wood pellets with coal is feasible considering adoption during wood pellets infancy under low discount rates and long power plant lifespans a portfolio effect of employing multiple fuels underlies this result however co firing is not currently economically feasible the different adoption decisions are likely a consequence of recent cheap and abundant u s natural gas for co fired wood pellets to be feasible government incentives and or a market increase in natural gas prices appear necessary

burning wood pellets for us electricity generation a regime switching analysis abstract applying a regime switching model under the theoretic framework of real options we inspect the optimal timing boundaries for coal and coal mixed wood pellets as two alternative fuels for a power plant in georgia united states results indicate that cofiring wood pellets with coal is generally not a commercially viable option however lower level with wood pellets

the temporary help industry a response to the dual internal labor market this study of the rapidly growing temporary help industry draws on commerce department data and the results of the authors national mail survey of employers the authors also conducted interviews in the san francisco area with employers of temporary help and with representatives of temporary help agencies and labor unions they provide a taxonomy of employer responses to temporary increases in work loads ranging from the more intensive use of full time employees to a variety of arrangements with part time temporary and casual employees the authors show how these employer responses vary by industry occupation size of the firm stability of product demand and the level of fringe benefits

optimizing the level of renewable electric r d expenditures using real options analysis abstract one of the primary objectives of the united states federal non hydro renewable electric r d program is to promote the development of technologies that have the potential to provide consumers with stable and secure energy supplies in order to quantify the benefits provided by continued federal renewable electric r d this paper uses real option pricing techniques to estimate the value of renewable electric technologies in the face of uncertain fossil fuel prices within the real options analysis framework the current value of expected future supply from renewable electric technologies net of federal r d expenditures is estimated to be 30 6 billion of this value 86 can be attributed to past federal r d efforts and 14 can be attributed to future federal r d efforts assuming continued federal r d funding at 300 million yr in addition real options analysis shows that the value of renewable electric technologies increases as current and future r d funding levels increase this indicates that the current level of federal renewable electric r d funding is sub optimal

observability and the payback criterion among the enigmas of corporate finance theory that have received little attention is the puzzling use of the payback method as a capital budgeting tool although the payback method has many drawbacks it is widely used in industry see klammer 1972 fremgren 1973 schall sundem and geijsback 1978 1 gordon 1955 attempted to explain this anomaly by observing that the inverse of the payback period is an approximation for the internal rate of return but as sarnat and levy 1969 point out the accuracy of the approximation depends on the life of the project and its irr for low values of irr the inverse of payback is a very poor approximation moreover it is difficult to believe that corporations that use complex and sophisticated technologies need a rule of thumb to approximate something as simple to compute as the irr in fact empirical evidence shows that most firms compute both the irr and the payback period see schall the payback criterion continues to be widely used in industry although there is little support for it among the academicians this paper attempts to find an economic rationale for it by using an incentive model with asymmetric information it argues that when the managers possess private information regarding projects selected for implementation it is in their interest to choose ceteris paribus projects that pay back faster since manager s wages depend on output because their productivity is unknown by choosing projects that pay back fast they hope to improve their reputations i wish to thank milton harris and an anonymous referee for their helpful suggestions while i retain the responsibility for any remaining errors 1 it has been found that payback is rarely used as a primary capital budgeting method it is used as a secondary criterion to a discounted cash flow method such as npv net present value or irr internal rate of return

the impact of natural disaster on energy consumption international evidence abstract this research shows that natural disasters may hurt energy consumption by using data on 123 countries over the period 1990 2015 and classifying them according to their economic development level and region based on world development indicators we employ a two step system gmm method to examine the effect of natural disasters on energy consumption presenting findings that support our hypotheses in the models and show a strong negative effect for low income countries or those in the africa region after considering an alternative proxy for natural disaster we implement quantile regression methods their results find that natural disasters exhibit a negative and significant impact on oil renewable and nuclear energy consumptions the quantile regression models used in the robustness check present that the effects are stronger for low level energy consumption economies

investment opportunity in china s overseas oil project an empirical analysis based on real option approach abstract china s overseas oil investments uphold national energy security located in the complex international economic and political environment the benefits of overseas oil projects are affected by various uncertainties oil companies call for a set of evaluation method dealing with these uncertainties especially when encountering low oil price conditions it is much more crucial to answer when to optimally invest rather than whether to invest this paper analyzes the investment opportunity of an oil project in the development and production phase considering uncertainty irreversibility and management flexibility the decision making process combines discounted cash flow dcf method and the trinomial tree model of real option approach roa for practical purposes tools of hurdle price cumulative probability and decision tree are adopted in addition results of the case project show the economic feasibility at present and optimal start up timing at the end of 2016 besides the lower cost parameters generally make it easier to meet the opportunity the scenario analysis suggests the higher risk contributes to an earlier start up furthermore the issues of method applicability investment signals and decision lag effects are discussed

renewable energy policy evaluation using real option model the case of taiwan abstract this study presents a policy benefit evaluation model that integrates cost efficiency curve information on renewable power generation technologies into real options analysis roa methods the proposed model evaluates quantitatively the policy value provided by developing renewable energy re in the face of uncertain fossil fuel prices and re policy related factors the economic intuition underlying the policy making process is elucidated while empirical analysis illustrates the option value embedded in the current development policy in taiwan for wind power in addition to revealing the benefits that re development provides when considering real options analytical results indicate that roa is a highly effective means of quantifying how policy planning uncertainty including managerial flexibility influences re development in addition to assessing the policy value of current re development policy this study also compares policy values in terms of internalized external costs and varying feed in tariff fit simulation results demonstrate that the re development policy with internalized co2 emission costs is appropriate policy planning from sustainability point of view furthermore relationship between varying fit and policy values can be shown quantitatively and appropriate fit level could be determined accordingly

executive effort and selection of risky projects this article examines the incentives of executives to adopt risky projects the agency problem considered is that of motivating the executive to expend effort to generate information about the profitability of projects and to select the best project conditional upon the information that his effort generates we show that the executive and the principal will not always agree regarding which project is best we provide conditions under which this conflict of interest leads from the principal s perspective to either an underinvestment or an overinvestment in risky projects

valuation of projects for power generation with renewable energy a comparative study based on real regulatory options abstract this comparative study evaluates an investment project on renewable energy based on wind power we have conducted the study in three european union countries denmark finland and portugal we have modelled the main uncertainties that affect this kind of project such as the cost and production of electric power investment costs and consumer price index for each of these countries we have analysed the mechanisms of public support for wind energy we have identified the real options included in the regulatory frameworks of these three countries and assessed how they affect the expanded net present value of the project to this end we have used two different methods of option valuation the monte carlo method and the binomial method we have proved that the obtained results using both methods are quite similar finally we have evaluated the public incentives for wind energy offered in each of these three countries and concluded that in economic terms finland is the country with the strongest support for this kind of energy followed by denmark and in the last place portugal

barriers to industrial energy efficiency investments in greece abstract this paper sets out to investigate the main determinants of industrial decision making process with respect to energy efficiency investments based on a survey among greek industries in the empirical analysis probit models are employed the results support that an energy saving campaign should regard industries as subgroups with different needs and different managerial aspects the importance of qualified employees is also established from this survey an energy conservation framework would be more effective if the diffusion of information with regard to industrial energy saving investments is based on investment in human capital

the efficiency paradox bureaucratic and organizational barriers to profitable energy saving investments abstract the paradox of why profitable energy saving investments are not undertaken continues to provoke debate the underlying phenomenon might be called the efficiency paradox because it represents a case in which business firms which are often presumed or taken axiomatically to be economically efficient make decisions that do not maximize profits new data from one of the us environmental protection agency s voluntary pollution prevention programs enables this paradox to be explored statistically the data show that both the level and variation in returns to lighting upgrade investments cannot be explained by standard economic models substantial gains in energy efficiency can be achieved without sacrificing profitability both economic and organizational factors account for some of the variation in observed returns to these investments but the results suggest a need for improved and more comprehensive theories of the investment behavior of firms and other organizations

the myths and facts of energy efficiency abstract the debate about how much energy efficiency is socially desirable and what is the best way to finance and implement energy conservation measures has reached a critical junction in many countries the arguments have passed the stage of whether more energy efficiency is possible or desirable and are centred around how much and how best to implement them this is a survey article which attempts to shed some light on several critical issues in this debate first it distinguishes between what is technically possible v what is economically desirable in energy efficiency improvements second it looks at some of the alleged causes of social under investment in energy efficiency and identifies ways to reduce or eliminate them third it addresses the question of who is best equipped to implement energy efficiency improvements and how one may go about promoting it finally the paper addresses critical financing and equity questions

compound real options valuation of renewable energy projects the case of a wind farm in serbia abstract renewable energy sources have become a very important issue due to environmental and sustainability concerns in addition most renewable energy electricity generation res e projects are characterized by considerable uncertainty and sequential decision making these projects net present value npv is very often close to zero which renders them a good candidate for the application of real options valuation methodology of investment project appraisal this paper examines the real options valuation of a potential onshore wind farm project in serbia the binomial tree model spans a 15 year period consisting of a 2 year investment period and a 13 year operating period the first 12 years of which are protected by feed in tariffs according to local renewable energy regulations the authors examine a multi phased compound nested path dependent real option consisting of mutually exclusive options a sequential option to invest as well as expand repower contract and abandon options volatility which is calculated by means of a monte carlo simulation according to the logarithmic present value returns approach shows predominant sensitivity to the capacity factor simulated with the rescaled weibull s probability distribution the final binomial tree results show that the proposed sequence of options increases project value by transforming higher risk and lower return in the initial discounted cash flow model to lower risk and higher return in the ro model this paper contributes to the existing literature in at least two ways it presents in depth analysis of the real option application to the res e project and provides decision makers with sophisticated tool for improving strategic thinking capital budgeting and decision making processes

linking consumer energy efficiency with security of supply most modern energy policies seek to achieve systematic ongoing incremental increases in consumer energy efficiency since this contributes to improved security of supply favourable environmental outcomes and increased economic efficiency yet realised levels of efficiency are typically well below the most cost effective equilibrium due to variety of behavioural and organisational barriers which are often linked to information constraints in addition efficient users are normally unrewarded for collective benefits to system security and to the environment thus reducing the incentives for energy consumers to invest in efficiency improvements this paper examines the dichotomies and symmetries between supply and demand side solutions to energy security concerns and reviews opportunities to overcome barriers to improved consumer efficiency a security market is identified as a mechanism to promote both demand and supply side investments that support electricity system security such a market would assist in setting the optimal quantity of reserves while achieving an efficient balance between supply and demand side initiatives it would also help to smooth overall investment throughout the energy system by encouraging incremental approaches such as distributed generation and demand side alternatives where they provide competitive value although the discussion is applicable to energy systems in general it focuses primarily on electricity in new zealand

investment timing and optimal capacity choice for small hydropower projects this paper presents a method for assessing small hydropower projects that are subject to uncertain electricity prices we present a real options based method with continuous scaling and we find that there is a unique price limit for initiating the project if the current electricity price is below this limit it is never optimal to invest but above this limit investment is made according to the function for optimal size the connection between the real option and the physical properties of a small hydropower plant is dealt with using a spreadsheet model that performs a technical simulation of the production in a plant based on all the important choices for such a plant the main results of the spreadsheet are simulated production size and the investment costs which are in turn used for finding the value of the real option and the price limit the method is illustrated on three different norwegian small hydropower projects

a real option model for renewable energy policy evaluation with application to solar pv power generation in china abstract this study proposes a policy evaluation model from the perspective of government and investors the proposed model which integrates american option method and two factor learning curve method can be used to evaluate the unit decision value and save path rate for renewable energy development and examine the existence of balance point of interest several uncertain factors including non renewable energy cost carbon price renewable energy cost and price subsidy are all considered in this model the model has been applied to evaluate the solar photovoltaic pv power generation in china our empirical results show that real option analysis roa is more effective than net present value analysis npv when handling uncertainty under current level of subsidy the government would suffer loss and the investors could benefit so that it is difficult to achieve the balance of interest during the planning period with the reduction of subsidy rate they can achieve the balance of interest

how much market do market based instruments create an analysis for the case of white certificates in the context of economic instruments for more energy efficiency and climate protection tradable certificates have been investigated for renewable energy and for a number of emissions in contrast tradable energy efficiency or white certificates have only lately been considered as a market based tool to foster energy efficiency as compared to standards and labelling for example theoretically there is little doubt about the advantages in practice however some fundamental problems arise critical issues are the design of an efficient artificial market for white certificates its compatibility with the european emissions trading system the identification of a suitable target group for an energy efficiency obligation and the measurement of energy savings as compared to a reference use of energy we use the theoretical framework of transaction cost economics to elaborate these issues we conclude that transaction costs and investment specificity will restrict markets for white certificates in practise long term contracts rather than spot trade will be the prevailing form of governance for energy efficiency investments

a real options model for renewable energy investment with application to solar photovoltaic power generation in china this paper proposes a real options model for evaluating renewable energy investment by considering uncertain factors such as co2 price non renewable energy cost investment cost and market price of electricity a phase out mechanism is built into the model to reflect the long term changes of subsidy policy we apply the proposed model to empirically evaluate the investment value and optimal timing for solar photovoltaic power generation in china our empirical results show that the current investment environment in china may not be able to attract immediate investment while the development of carbon market helps advance the optimal investment time a sensitivity analysis is conducted to investigate the dynamics of investment value and optimal timing under the changes of unit generating capacity subsidy level market price of electricity co2 price and investment cost it is found that the high investment cost and the volatility of electricity and co2 prices are not conducive to attract immediate investment instead increasing the level of subsidy promoting technological progress and maintaining the stability of market are useful to stimulate investment

demand side management overcoming market barriers or obscuring real costs abstract this paper compares two approaches to estimating the net benefits of a demand side management program that subsidizes the purchase of efficient equipment the total resource cost trc test suggests net benefits of us 6 9 million estimates based on consumer s surplus yield an estimated net loss of us 6 3 million this gap is due to differences in estimates of participants net benefits market failures do not appear to be significant and thus cannot explain much of the gap the more plausible explanation is that the trc uses a lower discount rate than participants use for themselves and it omits some costs

application of real options valuation for analysing the impact of public r d financing on renewable energy projects a company s perspective abstract this paper contrasts the financial benefit of grants given to research and development projects with the reduction in managerial flexibility they impose which implies a loss in the value of the project to quantify this loss of value real options analysis has been adopted as the most suitable framework to assess and quantify managerial flexibility this idea is illustrated by the case of a research and development project in renewable energy specifically concentrated solar power our results show that the value added by the grants is less than the nominal incentives received as a result of the loss of flexibility for managers they cannot apply certain options such as deferral nor can they abandon the project therefore a break even grant is proposed that equals the financial incentive with the loss of managerial flexibility under this break even point the grant should be rejected this paper will create awareness for both policy makers and private companies regarding a more accurate assessment of grants to research and development funding as well as provide insights to improve grant schemes without increasing the amount of public funds

stages of the recruitment process and the referrer s performance effect although the existing theory predicts that a referral s chances of being hired increase with the job performance of the referrer no empirical evidence is available to support this claim to address this discrepancy we decompose the recruitment process into objective selection subjective selection and self selection and theorize that the likelihood of passing a particular recruitment stage increases with the performance of the referrer under objective selection and self selection but remains undetermined at a stage of subjective selection our analysis of unique comprehensive data on online recruitment of sales agents in a virtual call center supports these arguments the effectiveness of personnel as a recruitment channel varies with the type of the recruitment stage and performance of the referrer when the firm evaluates candidates by an objective criterion the advantage of a referral increases with the performance of his or her referrer those referred by relatively high performing workers are significantly better than the applicants who learned about the job from internet ads when job candidates self select into the next stage of the online application process the referral of any agent is more likely to continue than a nonreferral and this likelihood increases with the performance of the referrer on a subjective stage the outcome is contingent on the intricacies of the recruitment process in our case an applicant s chances of being hired increase with the performance of his or her referrer because the firm rejects the referrals of low performing workers at a higher rate than it does nonreferrals while it treats equally the referrals of high performing workers and nonreferrals the study s contributions to the literature on social networks in labor markets are discussed

choice of nuclear power investments under price uncertainty valuing modularity this work aims at examining how to compare two investment projects in the electricity market the first project is a flexible sequence of small nuclear power plants whereas the second is a nuclear power plant of large capacity we measure the option value generated by the modularity of the first project given the uncertain future competitive price of electricity using a realistic calibration of the model we show that the option value of modularity has a sizeable effect on the optimal dynamic strategy of the producer in particular in terms of the optimal timing of the decision to invest in the first module

a real options evaluation model for the diffusion prospects of new renewable power generation technologies this study presents a policy planning model that integrates learning curve information on renewable power generation technologies into a dynamic programming formulation featuring real options analysis the model recursively evaluates a set of investment alternatives on a year by year basis thereby taking into account that the flexibility to delay an irreversible investment expenditure can profoundly affect the diffusion prospects of renewable power generation technologies price uncertainty is introduced through stochastic processes for the average wholesale price of electricity and for input fuel prices demand for electricity is assumed to be increasingly price sensitive as the electricity market deregulation proceeds reflecting new options of consumers to react to electricity price changes such as time of use pricing unbundled electricity services and choice of supplier the empirical analysis is based on data for the turkish electricity supply industry apart from general implications for policy making it provides some interesting insights about the impact of uncertainty and technical change on the diffusion of various emerging renewable energy technologies

barriers within firms to energy efficient investments abstract many investments in energy efficiency fail to be made despite their apparent profitability internal hurdle rates are often set at levels higher than the cost of capital to the firm reasons for these practices include bounded rationality principal agent problems and moral hazard the policy implication is that government can simultaneously improve overall energy efficiency and increase private sector productivity by providing informational and organizational services that go beyond the traditional regulatory framework

why do contractors contract the experience of highly skilled technical professionals in a contingent labor market this study examines 52 highly skilled technical contractors explanations in 1998 of why they entered the contingent labor force and how their subsequent experiences altered their viewpoint the authors report three general implications of their examination of the little studied high skill side of contingent labor first current depictions of contingent work are inaccurate for example contrary to the pessimistic employment relations perspective most of these interviewees found contracting better paying than permanent employment and contrary to optimistic free agent views many reported feeling anxiety and estrangement second occupational networks arose to satisfy needs such as training and wage setting that employing organizations satisfy for non contingent workers third regarding their place in the labor market high skilled and well paid technical contractors cannot be called as contingent workers usually are secondary sector workers and their market is not dyadic with individuals s

accelerated electricity conservation in juneau alaska a study of household activities that reduced demand 25 abstract an avalanche destroyed the main hydroelectric transmission line to juneau alaska in april 2008 diesel generated electricity was substituted causing electricity prices to increase 500 for 45 days electricity demand fell by 25 during the supply disruption most of the reduction occurred before the higher rates were implemented some conservation about 8 of historic consumption persisted after the transmission line was repaired and prices returned to normal consumers reduced energy use through a combination of new habits and technical improvements a survey of residential consumers indicated that the average household undertook 10 conservation actions with major changes in lighting space heating fuel switching and water and appliance use we propose a method for prioritizing conservation actions for promotion according to their impact in electricity savings as a function of popularity effectiveness and persistence and a dynamic framework for electricity use before during and after a supply disruption i e both the magnitude and rates of change in electricity conservation

the proof of the pudding making energy efficiency work abstract if western industrialized market economies are to realize a substantial proportion of the potential benefits of increased energy efficiency there is a need to move beyond engineering and economic estimates of efficiency potential and to consider seriously the implications of the behavioural and programme evaluation literature on energy efficiency that literature suggests that reliance upon market mechanisms alone will not permit realization of economically efficient levels of energy efficiency however if points the way toward designing energy efficiency programmes that show real promise of significantly achieving their potential in industrialized market economies

energy conservation policies in jordan abstract jordan imports almost all the energy required for its social and economic development during the period 1974 1984 energy consumption grew at an average rate of about 14 year due mainly to growth in the national economy but exacerbated by inefficient use of energy to alleviate the burden of the energy bill on the economy the ministry of energy has adopted a policy aimed at securing sufficient energy supplies at minimum cost to the economy this policy has focused on improving the efficiency of energy use and encouraging energy conservation in order to reduce the effect of oil imports on foreign reserves reduce the impact of emissions of toxic gases on the environment and the cost of additional investment in production facilities the energy conservation programme was put into application in early 1985 the energy income elasticity during the period 1985 1988 has dropped from 1 4 to 1 which indicates a substantial improvement in overall energy utilization

stretchwork managing the career progression paradox in external labor markets changes in employment relationships have diminished the degree to which internal labor markets shape careers using comparative field studies we examine how contract workers try to achieve career

asymmetric information incentives and intrafirm resource allocation this paper considers the question how should a firm allocate a resource among divisions when the productivity of the resource in each division is known only to the division manager obviously if the divisions as represented by their managers are indifferent among various allocations of the resource the headquarters can simply request the division managers to reveal their private information on productivity knowing that the managers have no incentive to lie the resource allocation problem can then be solved under complete or at least symmetric information this aspect is a flaw in much of the recent literature on this topic i e there is nothing in the models considered which makes divisions prefer one allocation over another thus although in some cases elaborate allocation schemes are proposed and analyzed they are really unnecessary in the model we develop a division can produce the same output with less managerial effort if it is allocated more resources and effort is costly to the manager we further assume that this effort is unobservable by the headquarters so that it cannot infer divisional productivity from data on divisional output and managerial effort given these assumptions we seek an optimal resource allocation process our results show that certain types of transfer pricing schemes are optimal in particular if there are no potentially binding capacity constraints on production of the resource then an optimal process is for each division to choose a transfer price from a schedule announced by the headquarters division managers receive a fixed compensation minus the cost of the resource allocated to them at the chosen transfer price resources are allocated on the basis of the chosen transfer prices if there is a potentially binding constraint on resource production a somewhat more complicated but similar scheme is required

valuing investment decisions of renewable energy projects considering changing volatility abstract volatility is an important parameter when evaluating investments using the real options method for renewable energy investments the volatility of cash flow continuously changes because as new information and knowledge are gathered there is less foreseen variation this paper proposes an extended recombining trinomial tree model where the changing volatility is used to generate transition probabilities the changing volatility is generated using a consolidation process where multiple random variables including the market price of electricity carbon price and lending rate are integrated into a low dimension stochastic process a two factor learning curve is used to model the changes of investment cost we apply the proposed model to analyze solar photovoltaic pv power generation investment in china the results show volatility with changing feature compared with constant volatility changing volatility may advance investment decisions and change the project value complete grid parity policy in the solar pv industry is infeasible because the opportunity cost brought by the option of delaying cannot be offset the changing volatility may produce a lower and equally effective subsidy level compared with constant volatility a carbon emission trading scheme is helpful in advancing investments in renewable energy which is reflected in improvements in project value advancements in investment decisions and reductions in the required subsidy level

can the regulated market help foster a free market for wind energy in brazil abstract wind energy has been negotiated in brazil s regulated market through auctions organized by the government bilateral negotiations in the free market have been scarce in 2011 wind farms were allowed to bid in a minus 5 a 5 auctions for energy with first delivery date 5 years ahead this new design was expected to stimulate negotiations in the free market as the 20 year contract in the regulated market eases financing while the 5 year grace period grants wind farms the option to sell whatever energy is generated beforehand in the free market we modeled bidders price decision in a 5 auctions as real options and concluded that given the low prices averaging usd 50 mw h winners are tempted to defer investment expecting more favorable equipment and energy prices or a better knowledge of the wind site construction is likely to begin in 2 3 years with little time left for the free market bidders that consider the option of eventually abandoning the project are more price competitive increasing chances that some wind farms will never materialize therefore this attempt to foster the free market may not pay off and moreover it may have the unfavorable effect of turning brazil s energy expansion planning a more difficult task

estimating bounds on the economy wide effects of the cef policy scenarios abstract the scenarios for a clean energy future study relied primarily on bottom up technology based methods to estimate costs associated with its scenarios these methods however do not allow for calculation of economy wide or general equilibrium effects of the policies considered we propose and apply a means of combining the bottom up estimates with estimates of the costs associated with a carbon charge obtained from computable general equilibrium models our approach is based on the concept of production inefficiency the economy lies within its production frontier with respect to the provision of energy services the cef technology policies are interpreted as moving the economy toward its frontier as well as moving the frontier outward while the carbon charge induces a substitution effect along the frontier this perspective allows a synthesis of the two sets of calculations

efficiency gains within firms under voluntary environmental initiatives this paper focuses on efficiency gains that voluntary environmental initiatives may achieve within the firm current debate concerning the extent and significance of inefficiencies within firms is critically important to the progress of energy and environmental policies several recent lines of inquiry in microeconomics help explain the persistence of inefficiencies within firms in addition two of the most prominent new approaches in the field of business strategy resource based strategy and the capabilities perspective focus on the heterogeneity among firms and the resulting pockets of inefficiency within firms they suggest at least three generic strategies for voluntary environmental initiatives challenging outdated organizational routines creating opportunities for differentiation or complementing firms resource investment trajectories these generic approaches suggest that there is considerable scope for further experimentation with voluntary environmental initiatives

real option valuation in renewable energy literature research focus trends and design abstract in light of intensive development of the renewable energy re sector a growing number of academic papers address the complexity of re investment planning and valuation to take account of the high risk profile and irreversibility of re investments researchers have resorted to sophisticated real options ro approaches that enable flexibility to be incorporated into project design in the face of an uncertain environment the variety of different frameworks and models adopted as well as a lack of aggregated analysis of the field suggest a need for a critical review of ro methodology and design in re assessment this study describes the research focus trends and design found in contemporary academic literature devoted to re valuation with a ro approach particular attention is given to ro in project and policy design the results give a comprehensive picture of existing research on the topic thus providing researchers with a solid foundation for further study and indications of directions for future development furthermore the findings provide policymakers and project planners with valuable insights into key aspects of re project and policy design

valuation for renewable energy a comparative review abstract environmental cost benefit analysis is applied for the evaluation of renewable energy projects since some benefits and costs do not have monetary values economic valuation techniques are applied to estimate them this paper reviews the literature on the valuation evaluation of renewable energy resources and summarizes the methods used in them it discerns four main streams of valuation in renewable energy the first is economic welfare oriented and comprises stated and revealed preference methods the second is the financial option analysis with a financial background the third is emergy analysis which is mostly an ecological engineering based method with capable economic links and the fourth is again economic but not welfare based the paper discusses the main directions discerned in these studies and recognizes first that proper valuation takes place only in the first method while the other methods describe only evaluation procedures and second that there is a research gap that has yet to be filled in as compared to other areas of environmental resource and energy economics

job stability in the united states two key attributes of a job are its wage and its duration much has been made of changes in the wage distribution in the 1980s but little attention has been given to job durations since hall we fill this void by examining the temporal evolution of job retention rates in u s labor markets using data assembled from the sequence of current population survey job tenure supplements there have been relative declines in job stability for some of the groups that experienced the sharpest declines in relative wages however we find that aggregate job retention rates have remained stable

impacts of market based climate change policies on the us pulp and paper industry abstract much of the policy debates on climate issues have centered on the optimal level and timing of policy interventions that cost effectively reduce greenhouse gas emissions we briefly review the range of policy issues in our paper and assess the impact that climate change policies may have on energy use and carbon emissions in the us pulp and paper industry we then present results from time series based analyses of changes in technologies and fuel mix and compare the results with engineering based technology analyses of us pulp and paper production for a copy of the model and software send e mail to mruth bu edu projections based on information for eight paper and paperboard categories are presented for the years 1995 2020 the findings indicate that under a wide range of specifications and policy assumptions carbon emissions from fossil fuel use per ton of product are likely to decline when combined with investment incentives an additional cost effective reduction in carbon emissions per ton of product will be realized however expected increases in output from the industry are likely to be higher than the reductions in energy and carbon intensities the policy implications of these findings are discussed

cumulative gender disadvantage in contract employment women s wages do not grow with experience or tenure as much as men s do many accounts of this cumulative gender disadvantage attribute it to women s underinvestment in firm specific skills yet if that were true this disadvantage would not exist where firm specific skills are not rewarded by the labor market this article investigates this argument in the context of contract employment where demand for firm specificity is minimal contrary to expectations men still receive higher rewards than women over time drawing on quantitative evidence and qualitative fieldwork using job histories of high skill contractors affiliated with a staffing firm the author finds support for two sources of women s disadvantage lower rates of movement across clients on the supply side and unmeasured demand side factors by which similar levels of tenure and client transitions accrue lower rewards to women implications for research on gender stratification and career advancement in nonformalized labor markets are discussed

growing apart the changing firm size wage premium and its inequality consequences wage inequality in the united states has risen dramatically over the past few decades prompting scholars to develop a number of theoretical accounts for the upward trend this study argues that large firms have been a prominent labor market institution that mitigates inequality by compensating their low and middle wage employees with a greater premium than their higher wage counterparts large u s firms reduced overall wage dispersion yet broader changes to employment relations associated with the demise of internal labor markets and the emergence of alternative employment arrangements have undermined large firms role as an equalizing institution using data from the current population survey and the survey of income and program participation we find that in 1989 although all private sector workers benefited from a firm size wage premium the premium was significantly higher for individuals at the lower end and middle of the wage distribution compared to those at the higher end between 1989 and

information processing and organizational structure abstract standard economic theories of the firm and other organizations stress profit maximization as the foundation for derivation of predictable behavior yet statistical and case study evidence continues to accumulate that real firms do not act as required by the neoclassical framework instead of being represented by ever more elaborate maximization models the firm can be modeled simply as a network of information processing agents the actions of the firm are then a function only of the network structure and the information processing capabilities of the agents this approach can be used to explain a number of features of organizational behavior including the process of technological diffusion it also suggests that derivation of the optimal organizational structure may be computationally complex with a number of implications for economic theory and policy development

capital rationing and organizational slack in capital budgeting this paper reconciles three stylized facts about capital budgeting in firms and shows that they are tied to the presence of asymmetric information among the several members of the firm each with his or her own objectives and decisions the facts of interest are 1 the existence of organizational slack 2 the rationing of resources within organizations 3 the stated cut off rate for accepting capital projects in firms is often greater than the market rate of interest organizational slack is defined as the excess of resources allocated over the minimum necessary to accomplish the tasks assigned resource rationing is defined as the under allocation of resources i e an increase in the amount allocated would generate revenues in excess of its costs rationing and slack are both manifestations of ex post inefficiencies an lp model is used to show that these inefficiencies can occur in ex ante efficient organizational designs when asymmetric information is present the optimal allocation policy involves a hurdle rate criterion in which the hurdle rate is strictly in excess of the cost of capital thus inducing rationing in some states of the world typically resources are optimally allocated such that slack exists in other states the optimal allocation policy trades off these two inefficiencies