Foreign and domestic investment:regional development or crowding out?

This paper tests, at the regional and industry level, the extent to which domestic investment is stimulated or crowded out by inward foreign direct investment. The paper develops a model of domestic investment, based on standard models drawn from macroeconomics and industrial economics. The paper then goes on to show that, at a general level, the 'development' or agglomeration hypothesis is confirmed that domestic investment is indeed stimulated by inward investment. However, there is also evidence that, in certain regions, inward investment has crowded out domestic investment. The implications of this from the perspective of regional policy are briefly discussed.

Inward investment, industry concentration and the speed of adjustment

T his paper seeks to examine the relationship between foreign direct investment (FDI) and industry concentration. Previous work in the area is somewhat contradictory in terms of the effect that FDI may be expected to have on host-country market structure. In addition, work which seeks to use concentration as a determinant of FDI (or indeed entry in a more generic sense) is rather ambiguous. This paper seeks to resolve these issues, and argues that inward FDI is more likely to reduce concentration by increasing competition than it is to increase monopoly power. In addition, the paper will show that the role of concentration in explaining FDI is more complex than has previously been understood. This paper is constructed as follows: Section II discusses the hypothesized relationship between market concentration and FDI, while Sections III, IV and V develop the models employed and discuss the econometric issues. Finally Sections VI and VII discuss the results and present some conclusions.

Computer aided manufacturing of geometric models

As systems for computer-aided-design and production of mechanical parts have developed, there has arisen a need for techniques for the comprehensive description of the desired part, including its 3-D shape. The creation and manipulation of shapes is generally known as geometric modelling. It is desirable that links be established between geometric modellers and machining programs. Currently, unbounded APT and some bounded geometry systems are being widely used in manufacturing industry for machining operations such as: milling, drilling, boring and turning, applied mainly to engineering parts. APT systems, however, are presently only linked to wire-frame drafting systems. The combination of a geometric modeller and APT will provide a powerful manufacturing system for industry from the initial design right through part manufacture using NC machines. This thesis describes a recently developed interface (ROMAPT) between a bounded geometry modeller (ROMULUS) and an unbounded NC processor (APT). A new set of theoretical functions and practical algorithms for the computer aided manufacturing of 3D solid geometric model has been investigated. This work has led to the development of a sophisticated computer program, ROMAPT, which provides a new link between CAD (in form of a goemetric modeller ROMULUS) and CAM (in form of the APT NC system). ROMAPT has been used to machine some engineering prototypes successfully both in soft foam material and aluminium. It has been demonstrated above that the theory and algorithms developed by the author for the development of computer aided manufacturing of 3D solid modelling are both valid and applicable. ROMAPT allows the full potential of a solid geometric modeller (ROMULUS) to be further exploited for NC applications without requiring major investment in new NC processor. ROMAPT supports output in APT-AC, APT4 and the CAM-I SSRI NC languages.

Public sector investment appraisal:the place of flexibility in the decision making process

This thesis reviews the main methodological developments in public sector investment appraisal and finds growing evidence that appraisal techniques are not fulfilling their earlier promise. It is suggested that an important reason for this failure lies in the inability of these techniques to handle uncertainty except in a highly circumscribed fashion. It is argued that a more fruitful approach is to strive for flexibility. Investment projects should be formulated with a view to making them responsive to a wide range of possible future events, rather than embodying a solution which is optimal for one configuration of circumstances only. The distinction drawn in economics between the short and the long run is used to examine the nature of flexibility. The concept of long run flexibility is applied to the pre-investment range of choice open to the decisionmaker. It is demonstrated that flexibility is reduced at a very early stage of decisionmaking by the conventional system of appraisal which evaluates only a small number of options. The pre-appraisal filtering process is considered further in relation to decisionmaking models. It is argued that for public sector projects the narrowing down of options is best understood in relation to an amended mixed scanning model which places importance on the process by which the 'national interest ' is determined. Short run flexibility deals with operational characteristics, the degree to which particular projects may respond to changing demands when the basic investment is already in place. The tension between flexibility and cost is noted. A short case study on the choice of electricity generating plant is presented. The thesis concludes with a brief examination of the approaches used by successive British governments to public sector investment, particularly in relation to the nationalised industries

A review of multi-factor capacity expansion models for manufacturing plants:searching for a holistic decision aid

Investment in capacity expansion remains one of the most critical decisions for a manufacturing organisation with global production facilities. Multiple factors need to be considered making the decision process very complex. The purpose of this paper is to establish the state-of-the-art in multi-factor models for capacity expansion of manufacturing plants within a corporation. The research programme consisting of an extensive literature review and a structured assessment of the strengths and weaknesses of the current research is presented. The study found that there is a wealth of mathematical multi-factor models for evaluating capacity expansion decisions however no single contribution captures all the different facets of the problem.

Selectivity and timing performance of UK investment trusts

This study examines the selectivity and timing performance of 218 UK investment trusts over the period July 1981 to June 2009. We estimate the Treynor and Mazuy (1966) and Henriksson and Merton (1981) models augmented with the size, value, and momentum factors, either under the OLS method adjusted with the Newey-West procedure or under the GARCH(1,1)-in-mean method following the specification of Glosten et al. (1993; hereafter GJR-GARCH-M). We find that the OLS method provides little evidence in favour of the selectivity and timing ability, consistent with previous studies. Interestingly, the GJR-GARCH-M method reverses this result, showing some relatively strong evidence on favourable selectivity ability, particularly for international funds, as well as favourable timing ability, particularly for domestic funds. We conclude that the GJR-GARCH-M method performs better in evaluating fund performance compared with the OLS method and the non-parametric approach, as it essentially accounts for the time-varying characteristics of factor loadings and hence obtains more reliable results, in particular, when the high frequency data, such as the daily returns, are used in the analysis. Our results are robust to various in-sample and out-of-sample tests and have valuable implications for practitioners in making their asset allocation decisions across different fund styles. © 2012 Elsevier B.V.

Exploring business models to provide a foundation for enhanced eye care services in high street optometric practice

High street optometric practices are for-profit businesses. They mostly provide sight testing and eye examination services and sell optical products, such as spectacles and contact lenses. The sight testing services are often sold at a vastly reduced price and profits are generated primarily through high margin spectacle sales, in a loss leading strategy. Published literature highlights weaknesses in this strategy as it forms a barrier to widening the scope of services provided within optometric practices. This includes specialist non-refraction based services, such as shared care. In addition this business strategy discourages investment in advanced diagnostic equipment and higher professional qualifications. The aim of this thesis was to develop a greater understanding of the traditional loss-leading strategy. The thesis also aimed to assess the plausibility of alternative business models to support the development of specialist non-refraction services within high street optometric practice. This research was based on a single independent optometric practice that specialises in advanced retinal imaging and offers a broad range of shared care services. Specialist non-refraction based services were found to be poor generators of spectacle sales likely due to patient needs and presenting concerns. Alternative business strategies to support these services included charging more realistic professional fees via cost-based pricing and monthly payment plans. These strategies enabled specialist services to be more self-sustainable with less reliance on cross-subsidy from spectacle sales. Furthermore, improving operational efficiency can increase stand-alone profits for specialist services.Practice managers may be reluctant to increase professional fees due to market pressures and confidence. However, this thesis found that patients were accepting of increased professional fees. Practice managers can implement alternative business models to enhance eye care provision in high street optometric practices. These alternative business models also improve revenues and profits generated via clinical services and improve patient loyalty.

Developing real option game models

By mixing concepts from both game theoretic analysis and real options theory, an investment decision in a competitive market can be seen as a ‘‘game’’ between firms, as firms implicitly take into account other firms’ reactions to their own investment actions. We review two decades of real option game models, suggesting which critical problems have been ‘‘solved’’ by considering game theory, and which significant problems have not been yet adequately addressed. We provide some insights on the plausible empirical applications, or shortfalls in applications to date, and suggest some promising avenues for future research.