A model for determining the optimal project life span and concession period of BOT projects

The concession agreement is the core feature of BOT projects, with the concession period being the most essential feature in determining the time span of the various rights, obligations and responsibilities of the government and concessionaire. Concession period design is therefore crucial for financial viability and determining the benefit/cost allocation between the host government and the concessionaire. However, while the concession period and project life span are essentially interdependent, most methods to date consider their determination as contiguous events that are determined exogenously. Moreover, these methods seldom consider the, often uncertain, social benefits and costs involved that are critical in defining, pricing and distributing benefits and costs between the various parties and evaluating potentially distributable cash flows. In this paper, we present the results of the first stage of a research project aimed at determining the optimal build-operate-transfer (BOT) project life span and concession period endogenously and interdependently by maximizing the combined benefits of stakeholders. Based on the estimation of the economic and social development involved, a negotiation space of the concession period interval is obtained, with its lower boundary creating the desired financial return for the private investors and its upper boundary ensuring the economic feasibility of the host government as well as the maximized welfare within the project life. The outcome of the new quantitative model is considered as a suitable basis for future field trials prior to implementation. The structure and details of the model are provided in the paper with Hong Kong tunnel project as a case study to demonstrate its detailed application. The basic contributions of the paper to the theory of construction procurement are that the project life span and concession period are determined jointly and the social benefits taken into account in the examination of project financial benefits. In practical terms, the model goes beyond the current practice of linear-process thinking and should enable engineering consultants to provide project information more rationally and accurately to BOT project bidders and increase the government's prospects of successfully entering into a contract with a concessionaire. This is expected to generate more negotiation space for the government and concessionaire in determining the major socioeconomic features of individual BOT contracts when negotiating the concession period. As a result, the use of the model should increase the total benefit to both parties.

A closed-form optimal tuning of mass dampers for one degree-of-freedom systems under rotating unbalance forcing

This paper is focused on the study of a vibrating system forced by a rotating unbalance and coupled to a tuned mass damper (TMD). The analysis of the dynamic response of the entire system is used to define the parameters of such device in order to achieve optimal damping properties. The inertial forcing due to the rotating unbalance depends quadratically on the forcing frequency and it leads to optimal tuning parameters that differ from classical values obtained for pure harmonic forcing. Analytical results demonstrate that frequency and damping ratios, as a function of the mass parameter, should be higher than classical optimal parameters. The analytical study is carried out for the undamped primary system, and numerically investigated for the damped primary system. We show that, for practical applications, proper TMD tuning allows to achieve a reduction in the steady-state response of about 20% with respect to the response achieved with a classically tuned damper. Copyright © 2015 by ASME.

Optimal foreign aid and tariffs

This paper investigates the optimal choice of foreign aid when trade policies are decided in a non-cooperative fashion. Three alternative scenarios, depending on the timing of the actions and on whether aid is tied, are analyzed. It is shown that, in the case where aid is decided before tariffs, untied aid can lead to the reduction of the recipient's optimal trade tax. When the donor can tie the aid to a reduction in the recipient's tariff, the optimal aid level is always positive and the world can always achieve a Pareto-efficient equilibrium.

Optimal production resource reallocation for CO2 emissions reduction in manufacturing sectors

To mitigate the effects of climate change, countries worldwide are advancing technologies to reduce greenhouse gas emissions. This paper proposes and measures optimal production resource reallocation using data envelopment analysis. This research attempts to clarify the effect of optimal production resource reallocation on CO2 emissions reduction, focusing on regional and industrial characteristics. We use finance, energy, and CO2 emissions data from 13 industrial sectors in 39 countries from 1995 to 2009. The resulting emissions reduction potential is 2.54 Gt-CO2 in the year 2009, with former communist countries having the largest potential to reduce CO2 emissions in the manufacturing sectors. In particular, basic material industry including chemical and steel sectors has a lot of potential to reduce CO2 emissions.