public policy supports and export performance of bioenergy technologies a dynamic panel approach abstract this study investigates the effects of public policy supports on the export performance of bioenergy technologies it uses panel data from 18 countries from the 1992 to 2008 period panel unit root and cointegration tests are applied taking into account the results of structural break tests for each time series and testing for the presence in the panel of cross sectional dependence time series data on public supports and exports are integrated and cointegrated the results of dynamic ordinary least squares indicate that in the long term public r d expenditures have a positive effect on the exports the contribution of bioenergy to the total energy supply has a negative effect on the exports and gdp has a positive effect on the exports the contribution of bioenergy to total energy supply responds to deviations in the previous period from the long term equilibrium additionally blundell bond system generalized methods of moments estimations are made to determine dynamic causality in a panel vector error correction mechanism setting evidence of a positive strong and short term relationship from exports to r d expenditures and of a positive short term causality from exports to the contribution of bioenergy to total energy supply is found a positive strong bidirectional relationship between gdp and exports is also uncovered there is a positive strong bidirectional and short term relationship between gdp and the contribution of bioenergy to total energy supply finally some policy implications based on the results of this study are offered

weak disposability in nonparametric production analysis reply to fare and grosskopf fare and grosskopf this issue claim that a single abatement factor suffices for modeling weak disposability in nonparametric production models and that the kuosmanen 2005 technology that uses multiple abatement factors is larger than necessary this article demonstrates by a numerical example that a single abatement factor does not suffice to capture all feasible production plans and that its use leads to the violation of convexity one of the maintained assumptions of the model we also prove that the kuosmanen technology is the correct minimum extrapolation technology under the stated axioms

degree of scale economies and congestion a unified dea approach abstract there are increasing concerns about how increase in congestion can adversely affect output as well as about the relative benefit cost ratio or return on investment associated with alternative projects or policies to address those problems regardless of what policy strategies are used to address congestion the fact remains that we cannot assess the economic benefits of congestion reduction strategies unless we are able to measure the extent to which congestion affects productivity in general and scale economies in particular this paper makes a novel attempt to suggest a method in a non parametric framework to measure scale elasticity in production in the presence of congestion

price discrimination in the airline market the effect of market concentration we test the hypothesis that price discrimination increases with competition in the airline market using a large cross section of tickets offered by several carriers on various routes we approximate price discrimination with marginal implicit prices of ticket restrictions that carriers typically use to price discriminate saturday night stayover re quirements and advanced purchase discounts we find that the restrictions are associated with lower airfares but that the discounts are smaller on routes with higher market concentration the results suggest that price dispersion attributed to ticket restrictions increases as markets becomemore competitive

simulating price patterns for tradable green certificates to promote electricity generation from wind abstract this article uses computer simulation to anticipate the price dynamics in a market for tradable green certificates tgcs these markets have been used in europe to promote generation of electricity from renewable resources like wind similar markets have been proposed in the united states of america usa where the certificates are called renewable energy credits recs the certificates are issued to the generating companies for each megawatt hour of renewable electricity generation the companies may sell the certificates in a market and the revenues from certificate sales provide an extra incentive to invest in new generating capacity proponents argue that this market based incentive can be designed to support government mandates for a growing fraction of electricity generation from renewable sources in the usa these mandates are set by the states and are known as renewable portfolio standards rps we simulate the price dynamics of a market designed to support an aggressive mandate for wind generation in the northwestern usa the simulations show that the certificate price climbs rapidly to the cap in the early years after the market opens investors then react to these high prices with construction of new wind capacity after a few years wind generation meets and then exceeds the requirement we show that this pattern appears again and again when the simulations are repeated with wide variations in the estimates of behavioral parameters we use the model to study the impact of different trading strategies by the wind companies and by the distribution companies we also study the simulated market response if the usa adopts the carbon allowance market envisioned in the climate stewardship act the article concludes with recommendations for policy makers involved in tgc market design

a comment on weak disposability in nonparametric production analysis in his 2005 paper in this journal kuosmanen argues that shephard s specification of weak disposability in activity analysis dea models is not correct we show that shephard s specification does satisfy weak disposability and is the smallest technology to do so

has ryanair s pricing strategy changed over time an empirical analysis of its 2006 2007 flights abstract this paper analyzes the question of whether ryanair s pricing strategies have changed over time we create a panel dataset of fares for all of ryanair s european flights over a two year period from 1 january 2006 to 31 december 2007 we calculate the average fare over a 90 day period prior to departure and the intensity of dynamic pricing for each flight in the panel in particular analysing the changes in these variables observed between pairs of equivalent flights our results show that overall both average fares and the intensity of dynamic pricing decreased in 2007 more than one third of flights saw a price reduction of more than 10 now that it has become the dominant low cost carrier in europe ryanair appears to be softening its dynamic pricing activities on existing routes typically employed to stimulate additional touristic demand thus booking in advance becomes relatively more expensive

congestion measurement under different policy objectives an analysis of chinese industry abstract in recent years the economic performance of chinese industry has improved significantly however the congestion caused by excessive investment has plagued its sustainable development in order to make full use of resources it is necessary for the chinese government to measure industrial congestion from different perspectives however most studies for measuring congestion only consider desirable outputs even if in practice these are always accompanied by undesirable outputs in this paper three policy objectives are proposed for industrial development in china the economic priority the environmental priority and the economic and environmental win win three new data envelopment analysis dea models with undesirable outputs were built for measuring undesirable congestion desirable congestion and double congestion respectively for these policy objectives these approaches can not only identify congestion situation but also calculate the total amount of congestion and were applied to an analysis of the congestion of regional industries in china results show that most regions have some form of longstanding input congestion under different policy objectives with this resulting in serious waste of resources based on the results obtained some suggestions for sustainable industrial development in china are proposed

multilateral productivity comparisons when some outputs are undesirable a nonparametric approach multilateral productivity comparisons of firms producing multiple outputs some of which are undesirable are obtained by making two modifications to the standard farrell approach to efficiency measurement the restriction that production technology satisfy strong disposability of outputs is relaxed to allow for the fact that undesirable outputs may be freely disposable and the efficiency measures are modified to allow for an asymmetric treatment of desirable and undesirable outputs performance measures that satisfy these requirements are calculated as solutions to programming problems the methodology is applied to a sample of mills producing paper and pollutants

dynamic pricing advance sales and aggregate demand learning in airlines this paper uses a unique u s airlines panel data set to empirically study the dynamic pricing of inventories with uncertain demand over a finite horizon i estimate a dynamic pricing equation and a dynamic demand equation that jointly characterize the adjustment process between prices and sales as the flight date nears i find that the price increases as the inventory decreases and decreases as there is less time to sell consistent with aggregate demand learning and price adjustment demand shocks have a positive and much larger effect on prices than the positive effect of anticipated sales

dea congestion and returns to scale under an occurrence of multiple optimal projections abstract economic implications of congestion have been recently discussed in many dea data envelopment analysis studies in addition several previous research efforts have explored a theoretical linkage between returns to scale rts and the concept of congestion because the two economic concepts are closely connected to each other tone and sahoo tone k sahoo b k 2004 degree of scale economies and congestion a unified dea approach european journal of operational research 158 755 772 have published the theoretical linkage in this journal all of the previous studies including their research 2004 assume a unique optimal solution in the investigation on dea based congestion when multiple solutions occur in dea based congestion measurement the economic implications of congestion obtained from the previous research are all problematic from both theoretical and practical perspectives to deal with the issue this study explores how to deal with the occurrence of multiple solutions in the dea based congestion measurement this study proposes a new approach for the congestion measurement and theoretically compares the proposed approach with tone and sahoo 2004

dea radial measurement for environmental assessment and planning desirable procedures to evaluate fossil fuel power plants abstract energy policy depends on a proper use of methodology in guiding a large energy issue such as the global warming and climate change dea is one of such methodologies that are often used for preparing environmental policy which is closely linked to various energy issues unfortunately the use of dea applied to environmental policy is insufficient often misguiding policy makers and other individuals who are involved in energy issues this study provides three guidelines for a use of dea in preparing environmental assessment first it is important to prepare both primal and dual formulations to confirm whether information regarding all production factors i e inputs desirable and undesirable outputs is fully utilized in dea assessment second dea has model variations in radial and non radial measurements it is necessary for us to examine environmental issues by different models in order to avoid a methodological bias existing in those empirical studies finally dea environmental assessment needs to incorporate the concept of natural and managerial disposability the natural disposability indicates that a firm negatively adapts a regulation change on undesirable outputs in contrast the managerial disposability indicates that a firm positively adapts the regulation change because the firm considers the regulation change as a new business opportunity

new empirical generalizations on the determinants of price elasticity abstract the importance of pricing decisions for firms has fueled an extensive stream of research on price elasticities in an influential meta analytical study tellis 1988 summarized price elasticity research findings until 1986 however empirical generalizations on price elasticity require modifications because of 1 changes in market characteristics i e characteristics of brands product categories and economic conditions and 2 changes in the research methodology used to assess price elasticities therefore the authors present a meta analysis of price elasticity with new empirical generalizations on its determinants across a set of 1851 price elasticities based on 81 studies the average price elasticity is 2 62 a salient finding is that over the past four decades sales elasticities have significantly increased in magnitude whereas share and choice elasticities have remained fairly constant the authors find that accommodating price endogeneity has a strong magnitude increasing impa

dynamic analysis of policy drivers for bioenergy commodity markets abstract biomass is increasingly being considered as a feedstock to provide a clean and renewable source of energy in the form of both liquid fuels and electric power in the united states the biofuels and biopower industries are regulated by different policies and have different drivers which impact the maximum price the industries are willing to pay for biomass this article describes a dynamic computer simulation model that analyzes future behavior of bioenergy feedstock markets given policy and technical options the model simulates the long term dynamics of these markets by treating advanced biomass feedstocks as a commodity and projecting the total demand of each industry as well as the market price over time the model is used for an analysis of the united states bioenergy feedstock market that projects supply demand and market price given three independent buyers domestic biopower domestic biofuels and foreign exports with base case assumptions the biofuels industry is able to dominate the market and meet the federal renewable fuel standard rfs targets for advanced biofuels further analyses suggest that united states bioenergy studies should include estimates of export demand in their projections and that ghg limiting policy would partially shield both industries from export dominance

returns to scale and damages to scale under natural and managerial disposability strategy efficiency and competitiveness of petroleum firms environmental assessment recently becomes a major policy issue all over the world this study discusses how to use data environment analysis dea for environmental assessment for planning corporate strategy and international competitiveness an important feature of dea environmental assessment is that it classifies outputs into desirable good and undesirable bad outputs because all private and public entities produce not only desirable outputs but also undesirable outputs as a result of their production activities this study proposes the two types of output unification for dea environmental assessment by using a non radial model one of the two output unifications is that it considers a decrease in an input vector along with a decrease in the vector of undesirable outputs this type of unification is referred to as natural disposability the other unification considers an increase in an input vector but a decrease in the vector of undesirable outputs this type of strategy is referred to as managerial disposability both unifications increase the vector of desirable outputs after developing the two concepts on disposability this study theoretically explores how to measure returns to scale rts under natural disposability and damages to scale dts under managerial disposability to document the practicality of the proposed approach this study applies it to compare the performance of national oil firms with that of international oil companies this study identifies four important findings on the petroleum industry first national oil companies outperform international oil companies in the unified efficiency under natural disposability second international oil companies outperform national oil companies in the unified efficiency under managerial disposability third national oil firms exhibit a mixed result on rts while international oil firms exhibit decreasing rts finally both national and international oil companies exhibit increasing dts implying that all oil firms need to decrease their operational sizes for improving their environmental performance on co2 emission as an alternative strategy the result suggests that they need to introduce technology innovation e g clean air technology into their business operations the technology based strategy has more practicality than the size reduction in their operations

multi dimensional price elasticity for leisure and business destinations in the low cost air transport market evidence from easyjet this study investigates the price elasticity of demand in the european low cost carrier lcc industry by analysing internet fares for all easyjet flights departing from the amsterdam schiphol airport towards 21 european destinations between march and september 2015 results suggest that the price elasticity of demand greatly varies across different dimensions ranging from 0 535 for the business oriented route of hamburg to 1 915 for the leisure oriented route of split price elasticity is also found to be higher for reservations made more days in advance for reservations and departures occurring on weekends and for flights taking off during lunchtime and in the summer period all results are consistent with the different behaviours of leisure and business passengers and the ongoing increase in the business component of the lcc passenger mix

congestion measurement in nonparametric analysis under the weakly disposable technology abstract congestion is a widely observed economic phenomenon where outputs are reduced due to excessive amount of inputs the previous approaches to identify congestion in nonparametric analysis only consider desirable outputs in the production process undesirable outputs are usually jointly produced with desirable outputs in this paper we propose an approach for measuring congestion in the presence of desirable and undesirable outputs simultaneously the proposed approach can discriminate between the congested dmus and the truly efficient dmus which are all efficient according to the scores calculated by the directional distance function finally an empirical example is used to illustrate the approach

productivity growth and pollution in state manufacturing the directional output distance function chambers chung fare 1996 is used to construct a malmquist luenberger index of total factor productivity growth for manufacturing when both good and bad outputs are jointly produced the index is constructed using information on good and bad output quantities and input quantities circumventing the problem of recovering shadow price information for the bad output needed for the fisher or tornqvist type of productivity indices accounting for toxic releases in manufacturing productivity growth averages 1 4 an nually during 1988 1994 the findings also suggest that the failure to account for toxic releases in manufacturing results in a significant under statement of total factor productivity growth

congestion and returns to scale in data envelopment analysis congestion indicates an economic state where inputs are overly invested evidence of congestion occurs whenever reducing some inputs can increase outputs return to scale is another related important economic implication of dea efficiencies in this research we discuss together the problems of congestion constant return to scale increasing return to scale and decreasing return to scale by output oriented dea models c2r model bc2 model fg model st model and a modified model we identify the necessary and sufficient conditions for the evidence of congestion constant increasing and decreasing returns to scale we show the exclusive relationships between the concepts of congestion and returns to scale numerical examples are provided for illustration

why do all the flights leave at 8 am competition and departure time differentiation in airline markets abstract theoretical models of spatial product differentiation indicate that firms face two opposing incentives 1 minimize differentiation in order to steal customers from competitors and 2 maximize differentiation in order to reduce price competition using data on u s airline departure times from 1975 when fares were regulated and 1986 when fares were not regulated we empirically estimate the effect of competition on differentiation we find a negative relationship in both periods in 1986 however reductions in exogenous scheduling constraints increase differentiation implying that firms may be differentiating their products where possible to reduce price competition this effect is not apparent in the 1975 data

prices prices and prices a study in the airline sector abstract this article creates and empirically analyzes a dynamic pricing framework the model includes the main theories on prices in the literature and dynamically analyzes how companies change their pricing policies according to different circumstances through the use of regressions the article shows the relative long and short term impact on pricing equations strategic versus operational matters and on production conditions versus demand perspectives in the setting of operational prices in addition it highlights how the proportions of these pricing perspectives change in the airline sector according to the effect of the environment on the configuration of the strategy determined by monthly and hourly seasonality and also according to the nature of this competitive strategy determined by the characteristics of the company and the destination airport the results confirm our framework and show how firms combine the different perspectives in their pricing strategies

equilibrium price dispersion under demand uncertainty the roles of costly capacity and market structure when capacity is costly and prices are set in advance firms facing uncertain demand will sell output at multiple prices and limit the quantity available at each price i show that the optimal price strategy of a monopolist and the unique pure strategy nash equilibria of oligopolists both exhibit intrafirm price dispersion moreover as the market becomes more competitive prices become more dispersed a pattern documented in the airline industry while generating similar predictions the model differs from the revenue management literature because it disregards market segmentation and fare restrictions that screen customers

low cost pricing strategies in leisure markets abstract the practice of dynamic pricing typical of low cost carriers is generally regarded as a form of price discrimination between leisure and business travellers on a single flight or route the same may not be true across different routes because of the different incidence of business travellers if price increases in the 15 days prior to departure are meant to discriminate business demand leisure demand should account for earlier price variations in the present study we used a database containing the daily fare over the 3 months prior to each flight operated by easyjet during 2009 for each route we defined the leisure index as the difference between the price rates of change during the 90 days and 15 days prior to departure overall business routes had lower average prices per km while leisure routes showed less dynamic price behaviour with higher minimum and lower maximum prices per km

a taxonomy and research overview of perishable asset revenue management yield management overbooking and pricing this paper proposes the term perishable asset revenue management to denote the field that combines the areas of yield management overbooking and pricing for perishable assets after summarizing the characteristics common to problems in this field the paper discusses the objectives and constraints faced by decision makers then it offers a comprehensive taxonomy with 14 different elements and reviews the research that has been done related to each element finally it suggests some important areas of future research that can help bridge the gap between theory and application

weak disposability in nonparametric production analysis with undesirable outputs environmental economics and natural resources group at wageningen university in the netherlands weak disposability of outputs means that firms can abate harmful emissions by decreasing the activity level modeling weak disposability in nonparametric production analysis has caused some confusion this article identifies a dilemma in these approaches conventional formulations implicitly and unintentionally assume all firms apply uniform abatement factors however it is usually cost effective to abate emissions in those firms where the marginal abatement costs are lowest this article presents a simple formulation of weak disposability that allows for non uniform abatement factors and preserves the linear structure of the model

alternative treatments of congestion in dea a rejoinder to cooper gu and li abstract this paper is a response to cooper w w b gu and s li comparisons and evaluations of alternative approaches to the treatment of congestion in dea european journal of operational research this issue who claim that the standard fgl procedure by fare grosskopf and lovell for dealing with congestion in dea can i fail to identify congestion when it is present and ii identify congestion when it is not present we clarify the notion of congestion and its relationship to structural efficiency and free disposability respectively to point out that the fgl approach was originally intended for measuring structural efficiency i e the influence of congestion on the efficiency of a particular production unit not for identifying occurrence of congestion in any feasible production vector moreover we point out that the result of cooper et al partially arises from ignorance of some key maintained assumptions underlying the fgl approach further we present some counter examples which demonstrate that the alternative approach advocated by cooper et al can equally fail in identification of congestion finally some remarks on the influence of sampling error and errors in variables on the two stage dea approaches are presented

comparisons and evaluations of alternative approaches to the treatment of congestion in dea abstract this paper examines the two approaches that are presently available in the data envelopment analysis dea literature for use in identifying and analyzing congestion the first approach due to fare et al fare r grosskopf s lovell c a k 1985 the measurement of efficiency of production kluwer nijhoff boston has been extensively employed to identify congestion in areas such as the provision of health services the latter approach due to cooper et al cooper w w thompson r g thrall r m 1996 annals of operations research 66 3 45 was subsequently extended by brockett et al brockett p l cooper w w shin h c wang y 1998 socio economic planning sciences 32 1 20 to treat tradeoff possibilities between employment and output in chinese production when congestion is present in contrast with cooper et al examples are provided in this paper which show that the fare et al approach can fail in both modes it can show congestion to be present when this is not consistent with the observed behavior it can also fail to exhibit congestion when the data show it to be present suggestions are offered both for i taking precautions before using the fgl approach and for ii overcoming these shortcomings

combined effects of capacity and time on fares insights from the yield management of a low cost airline abstract based on two strands of theoretical research this paper provides new evidence on how fares are jointly affected by in flight seat availability and purchasing date as capacity based theories predict it emerges that fares monotonically and substantially increase with flight occupancy after controlling for capacity utilization our analysis also supports time based theories indicating a u shaped temporal profile over a two month booking period as well as a sharp increase in fares in the two weeks prior to departure

demand elasticity estimates for new zealand tourism demand elasticities for new zealand tourism are estimated for 16 different international visitor segments segments are differentiated by origin purpose of visit and travel style elasticities for both international visitor arrivals and on the ground expenditure per arrival are estimated for each segment using time series data in general on the ground consumption per arrival is more price sensitive than number of arrivals and asian market segments are found to be more price sensitive both in terms of arrivals and on the ground expenditure compared to international visitors from other regions an application of the results is presented giving the total effect of exchange rate changes on expenditure by international visitors in new zealand and management implications are discussed