The Appraisal of projects with environmental impacts. Efficiency and Sustainability

It is usually assumed that the appraisal of the impacts experienced by present generations does not entail any difficulty. However, this is not true. Moreover, there is not a widely accepted methodology for taking these impacts into account. Some of the controversial issues are: the appropriate value for the discount rate, the choice of the units for expressing the impacts, physical or monetary units -income, consumption or investment- and the valuation of tangible and intangible goods. When approaching the problem of very long term impacts, there is also the problem of valuing the impacts experienced by future generations, through e.g., the use of an intergenerational discount rate. However, if this were the case, the present generation perspective would prevail, as if all the property rights on the resources were owned by them. Therefore, the sustainability requirement should also be incorporated into the analysis. We will analyze these problems in this article and show some possible solutions.

Effects of competition over quality-adjusted price indexes: an application to the Spanish automobile market

Using a newly constructed data set, we calculate quality-adjusted price indexes after estimating hedonic price regressions from 1988 to 2004 in the Spanish automobile market. The increasing competition was favoured by the removal of trade restrictions and the special plans for the renewal of the Spanish automobile fleet. We find that the increasing degree of competition during those years led to an overall drop in automobile prices by 20 percent which implied considerable consumer gains thanks to higher market efficiency. Additionally, our results indicate that loyalty relevance and discrepancies in automobile reliability declined during those years. This is captured.

Organisational status and efficiency: the case of the spanish SOE "Paradores"

The purpose of this paper is to provide new evidence on the issue of the effect on public enterprises economic performance of the introduction of some given changes in organisational status and management practices, while keeping the enterprises under public control. Our approach is case study type and relies on comparative efficiency literature. We identify relevant changes on the organisational status of a State owned large hotel group along a period of twenty years, next we measure its annual efficiency indicators, and then evaluate to which extent the observed changes in economic performance can be attributable to the corresponding management reforms carried out. As a result we find that the formally more relevant change in organisational status (the enterprise passing to be a Limited Company), which implied a substantial increase in the enterprise autonomy, did not produce a significant improvement in its economic performance; a finding contrary to what we expected according to agency theory. However, a second relevant organisational change –five years later- when both the principal (government) and the agent (firm’s CEO) changed is consistently related to a significant improvement in economic performance. As a research implication we abide for use more precise agency theory statements; and as a practical implication we argue here that potentialities of improvement brought about by a formal-legal change in the status of the enterprise may require also –in order to actually improve firm’s efficiency- some changes in the firm’s key personal positions: supervisor (principal) and CEO (agent), in the sense that a change to a greater-autonomy for the enterprise it seems should come together a parallel new ‘management culture’. Practical implications Management good practises to apply to other public enterprise’s restructuring in order to improve their efficiency. It’s the first study on organizational changes and efficiency for an important Spanish public enterprise.

Productive efficiency and regulatory reform: The case of vehicle inspection services

Measuring productive efficiency provides information on the likely effects of regulatory reform. We present a Data Envelopment Analysis (DEA) of a sample of 38 vehicle inspection units under a concession regime, between the years 2000 and 2004. The differences in efficiency scores show the potential technical efficiency benefit of introducing some form of incentive regulation or of progressing towards liberalization. We also compute scale efficiency scores, showing that only units in territories with very low population density operate at a sub-optimal scale. Among those that operate at an optimal scale, there are significant differences in size; the largest ones operate in territories with the highest population density. This suggests that the introduction of new units in the most densely populated territories (a likely effect of some form of liberalization) would not be detrimental in terms of scale efficiency. We also find that inspection units belonging to a large, diversified firm show higher technical efficiency, reflecting economies of scale or scope at the firm level. Finally, we show that between 2002 and 2004, a period of high regulatory uncertainty in the sample’s region, technical change was almost zero. Regulatory reform should take due account of scale and diversification effects, while at the same time avoiding regulatory uncertainty.

Bargaining one-dimensional policies and the efficiency of super majority rules

We consider negotiations selecting one-dimensional policies. Individuals have single-peaked preferences, and they are impatient. Decisions arise from a bargaining game with random proposers and (super) majority approval, ranging from the simple majority up to unanimity. The existence and uniqueness of stationary subgame perfect equilibrium is established, and its explicit characterization provided. We supply an explicit formula to determine the unique alternative that prevails, as impatience vanishes, for each majority. As an application, we examine the efficiency of majority rules. For symmetric distributions of peaks unanimity is the unanimously preferred majority rule. For asymmetric populations rules maximizing social surplus are characterized.

Assesing advertising efficiency: does the internet play a role?

This research focuses on a major concern for marketers addressing the claims of inefficiency of the spending on advertising. We examine whether the Internet can help increase overall advertising efficiency. Using a sample from the Spanish automobile industry, we combine a nonparametric method - Data Envelopment Analysis - with recent important insights from statistics and econometrics studies, and we find that online advertising improves the efficiency levels and this effect is more pronounced in the long-term temporal framework.

The Design and efficiency of loyalty rewards

The goal of this paper is to reexamine the optimal design and efficiency of loyalty rewards in markets for final consumption goods. While the literature has emphasized the role of loyalty rewards as endogenous switching costs (which distort the efficient allocation of consumers), in this paper I analyze the ability of alternative designs to foster consumer participation and increase total surplus. First, the efficiency of loyalty rewards depend on their specific design. A commitment to the price of repeat purchases can involve substantial efficiency gains by reducing price-cost margins. However, discount policies imply higher future regular prices and are likely to reduce total surplus. Second, firms may prefer to set up inefficient rewards (discounts), especially in those circumstances where a commitment to the price of repeat purchases triggers Coasian dynamics.

Determinació de compostos orgànics contaminants en aigües residuals industrials

La determinació de compostos orgànics contaminants en aigües residuals d’origen urbà i industrial és un tema que ha suscitat un creixent interès, tant des del punt de vista del problema mediambiental que es deriva de l’abocament d’aquestes aigües al medi aquàtic públic com des de la perspectiva de reutilització de les aigües tractades en processos industrials. La majoria d’aquests contaminants no s’eliminen completament en plantes de tractament d’aigües convencionals, pel que s’han de controlar. Aquest fet implica desenvolupar nous processos de tractament que permetin millorar l'eficiència de l'eliminació de les plantes de tractament convencionals. Per tal d'investigar la presència d'aquests compostos contaminants a baixes concentracions és necessari desenvolupar nous mètodes analítics altament sensibles. En el nostre projecte s'han desenvolupat diferents mètodes analítics per determinar compostos orgànics contaminants en aigües residuals provinents de plantes de tractament d'aigües industrials, urbanes i plantes potabilitzadores, utilizant principalment la microextracció en fase sòlida (SPME) seguida de la cromatografia de gasos acoblada a un espectròmetre de masses (GC-MS). S'ha estudiat la presència de diferents famílies de compostos en aquestes aigües, com són: ftalats, amines alifàtiques primàries i nitrosamines. A més a més, s'han desenvolupat mètodes analítics per determinar amines alifàtiques primàries en llots actius provinents de diferents tipus de plantes de tractament d'aigües i plantes potabilitzadores.

Accounting conservatism and firm investment efficiency

Conservatism, through the timelier recognition of losses in the income statement, is expected to increase firm investment efficiency through three main channels: (1) by decreasing the adverse effect of information asymmetries between outside equity holders and managers, facilitating the monitoring of managerial investment decisions; (2) by increasing managerial incentives to abandon poorly performing projects earlier and to undertake fewer negative net present-value investments; and (3) by facilitating the access to external financing at lower cost. Using a large US sample for the period 1990-2007 we find a negative association between conservatism and measures of over- and under- investment, and a positive association between conservatism and future profitability. This is consistent with firms reporting more conservative numbers investing more efficiently and in more profitable projects. Our results add to a growing stream of literature suggesting that eliminating conservatism from accounting regulatory frameworks may lead to undesirable economic consequences.

Origins and efficiency of the electric industry regulation in Spain, 1910-1936

The aim of this paper is to discover the origins of utility regulation in Spain, and to analyse, from a microeconomic perspective, its characteristics and the impact of regulation on consumers and utilities. Madrid and the Madrilenian utilities are taken as a case study. The electric industry in the period studied was a natural monopoly2. Each of the three phases of production, generation, transmission and distribution, had natural monopoly characteristics. Therefore, the most efficient form to generate, transmit and distribute electricity was the monopoly because one firm can produce a quantity at a lower cost than the sum of costs incurred by two or more firms. A problem arises because when a firm is the single provider it can charge prices above the marginal cost, at monopoly prices. When a monopolist reduces the quantity produced, price increases, causing the consumer to demand less than the economic efficiency level, incurring a loss of consumer surplus. The loss of the consumer surplus is not completely gained by the monopolist, causing a loss of social surplus, a deadweight loss. The main objective of regulation is going to be to reduce to a minimum the deadweight loss. Regulation is also needed because when the monopolist fixes prices at marginal cost equal marginal revenue there would be an incentive for firms to enter the market creating inefficiency. The Madrilenian industry has been chosen because of the availability of statistical information on costs and production. The complex industry structure and the atomised demand add interest to the analysis. This study will also provide some light on the tariff regulation of the period which has been poorly studied and will complement the literature on the US electric utilities regulation where a different type of regulation was implemented.

Evaluation of subsidies programs to sell green cars: Impact on prices, quantities and efficiency

During the recent period of economic crisis, many countries have introduced scrappage schemes to boost the sale and production of vehicles, particularly of vehicles designed to pollute less. In this paper, we analyze the impact of a particular scheme in Spain (Plan2000E) on vehicle prices and sales figures as well as on the reduction of polluting emissions from vehicles on the road. We considered the introduction of this scheme an exogenous policy change and because we could distinguish a control group (non-subsidized vehicles) and a treatment group (subsidized vehicles), before and after the introduction of the Plan, we were able to carry out our analysis as a quasi-natural experiment. Our study reveals that manufacturers increased vehicle prices by the same amount they were granted through the Plan (1,000 €). In terms of sales, econometric estimations revealed an increase of almost 5% as a result of the implementation of the Plan. With regard to environmental efficiency, we compared the costs (inverted quantity of money) and the benefits of the program (reductions in polluting emissions and additional fiscal revenues) and found that the Plan would only be beneficial if it boosted demand by at least 30%.

Production of OER, a Quest for Efficiency

In most initiatives to publish Open Educational Resources (OER), the production of OER is the activity with the highest costs. Based on literature and personal experiences a list of relevant characteristics of production processes for OER are determined. Three cases are compared with each other on these characteristics. Most influence on costs are human costs and the type of OER created.

The efficiency of direct payments versus tax reductions under uncertainty

This paper analyzes the optimal behavior of farmers in the presence of direct payments and uncertainty. In an empirical analysis for Switzerland, it confirms previously obtained theoretical results and determines the magnitude of the theoretical predicted effects. The results show that direct payments increase agricultural production between 3.7% to 4.8%. Alternatively to direct payments, the production effect of tax reductions is evaluated in order to determine its magnitude. The empirical analysis corroborates the theoretical results of the literature and demonstrates that tax reductions are also distorting, but to a substantially lesser degree if losses are not offset. However, tax reductions, independently whether losses are offset or not, lead to higher government spending than pure direct payments

Interplay of spectral efficiency, power and doppler spectrum for reference-signal-assisted wireless communication

Expressions relating spectral efficiency, power, and Doppler spectrum, are derived for Rayleigh-faded wireless channels with Gaussian signal transmission. No side information on the state of the channel is assumed at the receiver. Rather, periodic reference signals are postulated in accordance with the functioning of most wireless systems. The analysis relies on a well-established lower bound, generally tight and asymptotically exact at low SNR. In contrast with most previous studies, which relied on block-fading channel models, a continuous-fading model is adopted. This embeds the Doppler spectrum directly in the derived expressions, imbuing them with practical significance. Closed-form relationships are obtained for the popular Clarke-Jakes spectrum and informative expansions, valid for arbitrary spectra, are found for the low- and high-power regimes. While the paper focuses on scalar channels, the extension to multiantenna settings is also discussed.

Spectral efficiency in reference-signal-assisted low-power wireless communication

Expressions relating spectral efficiency, power and Doppler spectrum are derived for low-power Rayleighfaded wireless channels with proper complex signaling. Noside information on the state of the channel is assumed at the receiver. Rather, periodic reference signals are postulated inaccordance with the functioning of most wireless systems. In contrast with most previous studies, which relied on block-fading channel models, a continuous-fading model is adopted. This embeds the Doppler spectrum directly in thederived expressions thereby imbuing them with practical significance.