Optimal price regulation in a growth model with monopolistic suppliers of intermediate goods

In this paper we investigate the trade-off faced by regulators who must set a price for an intermediate good somewhere between the marginal cost and the monopoly price. We utilize a growth model with monopolistic suppliers of intermediate goods. Investment in innovation is required to produce a new intermediate good. Marginal cost pricing deters innovation, while monopoly pricing maximizes innovation and economic growth at the cost of some static inefficiency. We demonstrate the existence of a second-best price above the marginal cost but below the monopoly price, which maximizes consumer welfare. Simulation results suggest that substantial reductions in consumption, production, growth, and welfare occur where regulators focus on static efficiency issues by setting prices at or near marginal cost.

The Corrosion Performance of Magnesium Alloy AM-SC1 in Automotive Engine Block Applications

The magnesium alloy AM-SC1 has been developed as a creep-resistant automotive engine block material. This paper outlines its corrosion performance under laboratory test conditions, considering corrosion on both the external and internal surfaces. This study found that AM-SC1 has a corrosion performance comparable to AZ91 when subjected to an aggressive salt-spray environment or in galvanic-coupling environments. This article further demonstrates that, with the appropriate selection of a commercially available engine coolant, the internal corrosion of AM-SC1 can be maintained at a tolerable level. In addition, internal corrosion resistance can be significantly improved by the addition of fluorides to the coolant solution. It is concluded that AM-SC1 can be successfully used in an engine environment provided that some simple corrosion-prevention strategies are adopted.

Light alloy castings for automotive applications: The case of Al vs Mg

The economical and environmental effects of mass reduction through Al and Mg primary alloys substitutions for cast iron and steel in automotive components are discussed using MF. Ashby's penalty functions method The viability of Mg alloy substitutions for existing Al alloy cast components is also considered. The cost analysis shows that direct, equal-volume, Al alloy substitutions for cast iron and steel are the most feasible in terms of the CAFE liability, followed by substitutions involving flat panels of prescribed stiffness. When the creation of CO2 associated to the production of Al and Mg is considered, the potential gasoline savings over the lifespan of the car compensate for the intrinsic environmental burden of Al in all applications, while electrolytic Mg substitutions for cast iron and steel are feasible for equal volume and panels only. Magnesium produced by the Pidgeon thermal process appears to be too primary energy intensive to be competitive in structural applications. Magnesium substitutions for existing Al alloy beams and panels are generally unviable. The current higher recycling efficiency of Al casting alloys confers Al a significant advantage over Mg alloys.