Public-private partnership investments in dry ports – Russian logistics markets and risks

The investments have always been considered as an essential backbone and so-called ‘locomotive’ for the competitive economies. However, in various countries, the state has been put under tight budget constraints for the investments in capital intensive projects. In response to this situation, the cooperation between public and private sector has grown based on public-private mechanism. The promotion of favorable arrangement for collaboration between public and private sectors for the provision of policies, services, and infrastructure in Russia can help to address the problems of dry ports development that neither municipalities nor the private sector can solve alone. Especially, the stimulation of public-private collaboration is significant under the exposure to externalities that affect the magnitude of the risks during all phases of project realization. In these circumstances, the risk in the projects also is becoming increasingly a part of joint research and risk management practice, which is viewed as a key approach, aiming to take active actions on existing global and specific factors of uncertainties. Meanwhile, a relatively little progress has been made on the inclusion of the resilience aspects into the planning process of a dry ports construction that would instruct the capacity planner, on how to mitigate the occurrence of disruptions that may lead to million dollars of losses due to the deviation of the future cash flows from the expected financial flows on the project. The current experience shows that the existing methodological base is developed fragmentary within separate steps of supply chain risk management (SCRM) processes: risk identification, risk evaluation, risk mitigation, risk monitoring and control phases. The lack of the systematic approach hinders the solution of the problem of risk management processes of dry port implementation. Therefore, management of various risks during the investments phases of dry port projects still presents a considerable challenge from the practical and theoretical points of view. In this regard, the given research became a logical continuation of fundamental research, existing in the financial models and theories (e.g., capital asset pricing model and real option theory), as well as provided a complementation for the portfolio theory. The goal of the current study is in the design of methods and models for the facilitation of dry port implementation through the mechanism of public-private partnership on the national market that implies the necessity to mitigate, first and foremost, the shortage of the investments and consequences of risks. The problem of the research was formulated on the ground of the identified contradictions. They rose as a continuation of the trade-off between the opportunities that the investors can gain from the development of terminal business in Russia (i.e. dry port implementation) and risks. As a rule, the higher the investment risk, the greater should be their expected return. However, investors have a different tolerance for the risks. That is why it would be advisable to find an optimum investment. In the given study, the optimum relates to the search for the efficient portfolio, which can provide satisfaction to the investor, depending on its degree of risk aversion. There are many theories and methods in finance, concerning investment choices. Nevertheless, the appropriateness and effectiveness of particular methods should be considered with the allowance of the specifics of the investment projects. For example, the investments in dry ports imply not only the lump sum of financial inflows, but also the long-term payback periods. As a result, capital intensity and longevity of their construction determine the necessity from investors to ensure the return on investment (profitability), along with the rapid return on investment (liquidity), without precluding the fact that the stochastic nature of the project environment is hardly described by the formula-based approach. The current theoretical base for the economic appraisals of the dry port projects more often perceives net present value (NPV) as a technique superior to other decision-making criteria. For example, the portfolio theory, which considers different risk preference of an investor and structures of utility, defines net present value as a better criterion of project appraisal than discounted payback period (DPP). Meanwhile, in business practice, the DPP is more popular. Knowing that the NPV is based on the assumptions of certainty of project life, it cannot be an accurate appraisal approach alone to determine whether or not the project should be accepted for the approval in the environment that is not without of uncertainties. In order to reflect the period or the project’s useful life that is exposed to risks due to changes in political, operational, and financial factors, the second capital budgeting criterion – discounted payback period is profoundly important, particularly for the Russian environment. Those statements represent contradictions that exist in the theory and practice of the applied science. Therefore, it would be desirable to relax the assumptions of portfolio theory and regard DPP as not fewer relevant appraisal approach for the assessment of the investment and risk measure. At the same time, the rationality of the use of both project performance criteria depends on the methods and models, with the help of which these appraisal approaches are calculated in feasibility studies. The deterministic methods cannot ensure the required precision of the results, while the stochastic models guarantee the sufficient level of the accuracy and reliability of the obtained results, providing that the risks are properly identified, evaluated, and mitigated. Otherwise, the project performance indicators may not be confirmed during the phase of project realization. For instance, the economic and political instability can result in the undoing of hard-earned gains, leading to the need for the attraction of the additional finances for the project. The sources of the alternative investments, as well as supportive mitigation strategies, can be studied during the initial phases of project development. During this period, the effectiveness of the investments undertakings can also be improved by the inclusion of the various investors, e.g. Russian Railways’ enterprises and other private companies in the dry port projects. However, the evaluation of the effectiveness of the participation of different investors in the project lack the methods and models that would permit doing the particular feasibility study, foreseeing the quantitative characteristics of risks and their mitigation strategies, which can meet the tolerance of the investors to the risks. For this reason, the research proposes a combination of Monte Carlo method, discounted cash flow technique, the theory of real options, and portfolio theory via a system dynamics simulation approach. The use of this methodology allows for comprehensive risk management process of dry port development to cover all aspects of risk identification, risk evaluation, risk mitigation, risk monitoring, and control phases. A designed system dynamics model can be recommended for the decision-makers on the dry port projects that are financed via a public-private partnership. It permits investors to make a decision appraisal based on random variables of net present value and discounted payback period, depending on different risks factors, e.g. revenue risks, land acquisition risks, traffic volume risks, construction hazards, and political risks. In this case, the statistical mean is used for the explication of the expected value of the DPP and NPV; the standard deviation is proposed as a characteristic of risks, while the elasticity coefficient is applied for rating of risks. Additionally, the risk of failure of project investments and guaranteed recoupment of capital investment can be considered with the help of the model. On the whole, the application of these modern methods of simulation creates preconditions for the controlling of the process of dry port development, i.e. making managerial changes and identifying the most stable parameters that contribute to the optimal alternative scenarios of the project realization in the uncertain environment. System dynamics model allows analyzing the interactions in the most complex mechanism of risk management process of the dry ports development and making proposals for the improvement of the effectiveness of the investments via an estimation of different risk management strategies. For the comparison and ranking of these alternatives in their order of preference to the investor, the proposed indicators of the efficiency of the investments, concerning the NPV, DPP, and coefficient of variation, can be used. Thus, rational investors, who averse to taking increased risks unless they are compensated by the commensurate increase in the expected utility of a risky prospect of dry port development, can be guided by the deduced marginal utility of investments. It is computed on the ground of the results from the system dynamics model. In conclusion, the outlined theoretical and practical implications for the management of risks, which are the key characteristics of public-private partnerships, can help analysts and planning managers in budget decision-making, substantially alleviating the effect from various risks and avoiding unnecessary cost overruns in dry port projects.

Incerteza e não ergodicidade: crítica aos neoclássicos

The starting point of this essay is to show that, in our view, the problem of the traditional economics is not in the deductive method nor the mathematical methods used, but to attribute to economic agents "power" on the future and prescribe the existence of ergodic stochastic processes in their economic analyzes. Thus, building a theory on the ground whose bases are not able to sustain a proper understanding of the world, mainstream economics has difficulties in using the modeling for establishing deductions and conclusions that help understanding the system. Thus, the logical-mathematical rigor in economic models and deduction can be used with appropriate axioms, which is not the case of mainstream economics. Our hypothesis is that the inability of the mainstream in predicting economic crisis is due to the non-recognition of some principles that best describe the dynamics of financialized contemporary capitalism, as the principles of non-ergodicity and Keynesian uncertainty.

Dynamics AX -toiminnanohjausjärjestelmän jatkuvuudenhallinta ja toipumissuunnitelma - Simulaatiotestausmalli: case CGI Suomi Oy

Nyky-yhteiskunta nojautuu vahvasti tietojärjestelmiin luoden laajemman arkkitehtuurisen kokonaisuuden, kybertoimintaympäristön. Liiketoimintaa tukevat tietojärjestelmät tukevat myös organisaatioiden prosesseja kokonaisvaltaisesti. Jotta näitä tärkeitä kyberympäristön tietojärjestelmä- sekä liiketoimintaympäristöresursseja pystytään käyttämään, tulee järjestelmien olla luotettavia ja sovellusten saatavilla vuorokauden ympäri tai aina tarvittaessa. Tilanteet, joissa järjestelmän käytettävyys vaarantuu, voivat eskaloitua yllättäen suuremmiksi, jos poikkeustilanteisiin ei ole varauduttu. Poikkeustilanteisiin varautumiseen tarvitaan jatkuvuudenhallintaa, joka on kiinteästi osa kattavampaa IT-strategiaa ja koko yhteiskunta-/yrityskulttuuria. Työ on toteutettu yhdistäen empiriaa ja teoriaa eli tavoitteena on teoreettisen tietämyksen ja käytännön kokemuksellisen oppimisen ja tietämyksen kautta luoda konstruktiivisella otteella toipumissuunnitelman testauksessa käytettävä simulaatiotestausmalli. Dynamics AX -toiminnanohjausjärjestelmän toipumissuunnitelman simulaatiotestausmallista rakentui selkeä ja kevyt työkalu asiakasyritysten toipumissuunnitelman simulaatiotestauksiin. Diplomityössä kuvatuilla keinotekoisilla järjestelmän häiriötilanteilla pystytään simuloimaan Dynamics AX:n toipumissuunnitelman testauksissa oikeita häiriötilanteita suhteellisen kattavalla tasolla.

An application of cell-cluster theory to a rare gas crystal /|n[by] K. Westera. - 260 St. Catharines [Ont.] : Dept. of Physics, Brock University,

The Lennard-Jones Devonshire 1 (LJD) single particle theory for liquids is extended and applied to the anharmonic solid in a high temperature limit. The exact free energy for the crystal is expressed as a convergent series of terms involving larger and larger sets of contiguous particles called cell-clusters. The motions of all the particles within cell-clusters are correlated to each other and lead to non-trivial integrals of orders 3, 6, 9, ... 3N. For the first time the six dimensional integral has been calculated to high accuracy using a Lennard-Jones (6-12) pair interaction between nearest neighbours only for the f.c.c. lattice. The thermodynamic properties predicted by this model agree well with experimental results for solid Xenon.

A treatment of atomic mean square displacement in higher order perturbation theory

A general derivation of the anharmonic coefficients for a periodic lattice invoking the special case of the central force interaction is presented. All of the contributions to mean square displacement (MSD) to order 14 perturbation theory are enumerated. A direct correspondance is found between the high temperature limit MSD and high temperature limit free energy contributions up to and including 0(14). This correspondance follows from the detailed derivation of some of the contributions to MSD. Numerical results are obtained for all the MSD contributions to 0(14) using the Lennard-Jones potential for the lattice constants and temperatures for which the Monte Carlo results were calculated by Heiser, Shukla and Cowley. The Peierls approximation is also employed in order to simplify the numerical evaluation of the MSD contributions. The numerical results indicate the convergence of the perturbation expansion up to 75% of the melting temperature of the solid (TM) for the exact calculation; however, a better agreement with the Monte Carlo results is not obtained when the total of all 14 contributions is added to the 12 perturbation theory results. Using Peierls approximation the expansion converges up to 45% of TM• The MSD contributions arising in the Green's function method of Shukla and Hubschle are derived and enumerated up to and including 0(18). The total MSD from these selected contributions is in excellent agreement with their results at all temperatures. Theoretical values of the recoilless fraction for krypton are calculated from the MSD contributions for both the Lennard-Jones and Aziz potentials. The agreement with experimental values is quite good.

Molecular dynamics calculation of mean square displacement in alkali metals and rare gas solids and comparison with lattice dynamics

Molec ul ar dynamics calculations of the mean sq ua re displacement have been carried out for the alkali metals Na, K and Cs and for an fcc nearest neighbour Lennard-Jones model applicable to rare gas solids. The computations for the alkalis were done for several temperatures for temperature vol ume a swell as for the the ze r 0 pressure ze ro zero pressure volume corresponding to each temperature. In the fcc case, results were obtained for a wide range of both the temperature and density. Lattice dynamics calculations of the harmonic and the lowe s t order anharmonic (cubic and quartic) contributions to the mean square displacement were performed for the same potential models as in the molecular dynamics calculations. The Brillouin zone sums arising in the harmonic and the quartic terms were computed for very large numbers of points in q-space, and were extrapolated to obtain results ful converged with respect to the number of points in the Brillouin zone.An excellent agreement between the lattice dynamics results was observed molecular dynamics and in the case of all the alkali metals, e~ept for the zero pressure case of CSt where the difference is about 15 % near the melting temperature. It was concluded that for the alkalis, the lowest order perturbation theory works well even at temperat ures close to the melting temperat ure. For the fcc nearest neighbour model it was found that the number of particles (256) used for the molecular dynamics calculations, produces a result which is somewhere between 10 and 20 % smaller than the value converged with respect to the number of particles. However, the general temperature dependence of the mean square displacement is the same in molecular dynamics and lattice dynamics for all temperatures at the highest densities examined, while at higher volumes and high temperatures the results diverge. This indicates the importance of the higher order (eg. ~* ) perturbation theory contributions in these cases.

Particle swarm optimization for two-connected networks with bounded rings

The Two-Connected Network with Bounded Ring (2CNBR) problem is a network design problem addressing the connection of servers to create a survivable network with limited redirections in the event of failures. Particle Swarm Optimization (PSO) is a stochastic population-based optimization technique modeled on the social behaviour of flocking birds or schooling fish. This thesis applies PSO to the 2CNBR problem. As PSO is originally designed to handle a continuous solution space, modification of the algorithm was necessary in order to adapt it for such a highly constrained discrete combinatorial optimization problem. Presented are an indirect transcription scheme for applying PSO to such discrete optimization problems and an oscillating mechanism for averting stagnation.

Generating Aesthetically Pleasing Images in a Virtual Environment using Particle Swarm Optimization

This research focuses on generating aesthetically pleasing images in virtual environments using the particle swarm optimization (PSO) algorithm. The PSO is a stochastic population based search algorithm that is inspired by the flocking behavior of birds. In this research, we implement swarms of cameras flying through a virtual world in search of an image that is aesthetically pleasing. Virtual world exploration using particle swarm optimization is considered to be a new research area and is of interest to both the scientific and artistic communities. Aesthetic rules such as rule of thirds, subject matter, colour similarity and horizon line are all analyzed together as a multi-objective problem to analyze and solve with rendered images. A new multi-objective PSO algorithm, the sum of ranks PSO, is introduced. It is empirically compared to other single-objective and multi-objective swarm algorithms. An advantage of the sum of ranks PSO is that it is useful for solving high-dimensional problems within the context of this research. Throughout many experiments, we show that our approach is capable of automatically producing images satisfying a variety of supplied aesthetic criteria.

A game-theoretic network formation model

We study the dynamics of a game-theoretic network formation model that yields large-scale small-world networks. So far, mostly stochastic frameworks have been utilized to explain the emergence of these networks. On the other hand, it is natural to seek for game-theoretic network formation models in which links are formed due to strategic behaviors of individuals, rather than based on probabilities. Inspired by Even-Dar and Kearns (2007), we consider a more realistic model in which the cost of establishing each link is dynamically determined during the course of the game. Moreover, players are allowed to put transfer payments on the formation of links. Also, they must pay a maintenance cost to sustain their direct links during the game. We show that there is a small diameter of at most 4 in the general set of equilibrium networks in our model. Unlike earlier model, not only the existence of equilibrium networks is guaranteed in our model, but also these networks coincide with the outcomes of pairwise Nash equilibrium in network formation. Furthermore, we provide a network formation simulation that generates small-world networks. We also analyze the impact of locating players in a hierarchical structure by constructing a strategic model, where a complete b-ary tree is the seed network.

Aggregations and Marginalization of GARCH and Stochastic Volatility Models

The GARCH and Stochastic Volatility paradigms are often brought into conflict as two competitive views of the appropriate conditional variance concept : conditional variance given past values of the same series or conditional variance given a larger past information (including possibly unobservable state variables). The main thesis of this paper is that, since in general the econometrician has no idea about something like a structural level of disaggregation, a well-written volatility model should be specified in such a way that one is always allowed to reduce the information set without invalidating the model. To this respect, the debate between observable past information (in the GARCH spirit) versus unobservable conditioning information (in the state-space spirit) is irrelevant. In this paper, we stress a square-root autoregressive stochastic volatility (SR-SARV) model which remains true to the GARCH paradigm of ARMA dynamics for squared innovations but weakens the GARCH structure in order to obtain required robustness properties with respect to various kinds of aggregation. It is shown that the lack of robustness of the usual GARCH setting is due to two very restrictive assumptions : perfect linear correlation between squared innovations and conditional variance on the one hand and linear relationship between the conditional variance of the future conditional variance and the squared conditional variance on the other hand. By relaxing these assumptions, thanks to a state-space setting, we obtain aggregation results without renouncing to the conditional variance concept (and related leverage effects), as it is the case for the recently suggested weak GARCH model which gets aggregation results by replacing conditional expectations by linear projections on symmetric past innovations. Moreover, unlike the weak GARCH literature, we are able to define multivariate models, including higher order dynamics and risk premiums (in the spirit of GARCH (p,p) and GARCH in mean) and to derive conditional moment restrictions well suited for statistical inference. Finally, we are able to characterize the exact relationships between our SR-SARV models (including higher order dynamics, leverage effect and in-mean effect), usual GARCH models and continuous time stochastic volatility models, so that previous results about aggregation of weak GARCH and continuous time GARCH modeling can be recovered in our framework.

A Theory of Random Consumer Demand

This paper presents a new theory of random consumer demand. The primitive is a collection of probability distributions, rather than a binary preference. Various assumptions constrain these distributions, including analogues of common assumptions about preferences such as transitivity, monotonicity and convexity. Two results establish a complete representation of theoretically consistent random demand. The purpose of this theory of random consumer demand is application to empirical consumer demand problems. To this end, the theory has several desirable properties. It is intrinsically stochastic, so the econometrician can apply it directly without adding extrinsic randomness in the form of residuals. Random demand is parsimoniously represented by a single function on the consumption set. Finally, we have a practical method for statistical inference based on the theory, described in McCausland (2004), a companion paper.

A critique of Nancy Fraser's theory of social justice : self-determination and the Mohawks of Kahnawá:ke

La présente étude se concentre sur le travail de Nancy Fraser sur la justice sociale, lequel a suscité beaucoup d’intérêt dans la littérature au cours des dernières années. La reconnaissance et la redistribution sont les deux piliers originaux de son approche: les désavantages dont souffrent les gens dus au dénigrement culturel ou à la privation économique. Ces deux concepts servent à diagnostiquer et fournir le soutien moral aux multiples luttes que les victimes d’injustice entreprennent avec l’objectif d’établir une participation plus égalitaire à la société. Cependant, que peut-elle dire cette approche des groupes qui sont marginalisés et cherchent l’autogouvernance (ou la séparation même) plutôt que l’intégration dans la société? Le travail de Fraser manifeste une résistance envers les droits du groupe, et un silence quant à l’autodétermination. Mon intervention prend comme objectif d’inclure ces formes d’injustice dans son approche, la rendant plus sensible aux dynamiques des groupes et capable de répondre à leurs revendications trop souvent négligées sous prétexte de l’égalité. La question est, l’égalité de qui?

Efficient estimation using the characteristic function : theory and applications with high frequency data

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Impacts potentiels d’un changement climatique sur le pergélisol dans le nord canadien

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Affine and generalized affine models : Theory and applications

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