On the throughput-WIP trade-off in queueing systems, diminishing returns and the threshold property: A linear programming approach

We present a new unifying framework for investigating throughput-WIP(Work-in-Process) optimal control problems in queueing systems,based on reformulating them as linear programming (LP) problems withspecial structure: We show that if a throughput-WIP performance pairin a stochastic system satisfies the Threshold Property we introducein this paper, then we can reformulate the problem of optimizing alinear objective of throughput-WIP performance as a (semi-infinite)LP problem over a polygon with special structure (a thresholdpolygon). The strong structural properties of such polygones explainthe optimality of threshold policies for optimizing linearperformance objectives: their vertices correspond to the performancepairs of threshold policies. We analyze in this framework theversatile input-output queueing intensity control model introduced byChen and Yao (1990), obtaining a variety of new results, including (a)an exact reformulation of the control problem as an LP problem over athreshold polygon; (b) an analytical characterization of the Min WIPfunction (giving the minimum WIP level required to attain a targetthroughput level); (c) an LP Value Decomposition Theorem that relatesthe objective value under an arbitrary policy with that of a giventhreshold policy (thus revealing the LP interpretation of Chen andYao's optimality conditions); (d) diminishing returns and invarianceproperties of throughput-WIP performance, which underlie thresholdoptimality; (e) a unified treatment of the time-discounted andtime-average cases.

Economic booms, trade deficits and economic policy

Many economic booms have been accompanied by realexchange rate appreciations, large trade defcits -whichhave sometimes persisted after the return to the initialexchange rate parity- and a deteriorating traded sector.Those circumstances have typically raised the questionof the de-sirability of some stabilization policy. We show that the dynamics induced by an expectedproductivity shock in an economy where the capital stockis non-mobile across sectors, match those circumstances.Furthermore, we obtain that credit market imperfectionstend to exacerbate trade deficits, and to cause aninefficient capacity reduction in the traded sector.Some stabilization policies are explored.

Cape Verde - Diagnostic Trade Inttegration study Update - 2013

This Report is an update of the Cape Verde Diagnostic Trade Integration Study, titled Cape Verde’s Insertion into the Global Economy, produced and validated by the Government of Cape Verde in December 2008. Like the previous 2008 study, this Cape Verde Diagnostic Trade Integration Study Update provides a critical examination of the major institutional and production constraints that hinder Cape Verde’s ability to capitalize fully on the growth and welfare gains from its integration into the world economy. As a policy report, this study offers a set of priority policies and measures that can be implemented by both the public and private sectors to mitigate and surmount these supply side and institutional constraints. These recommendations are summarized in an Action Matrix. The Report is fruit of the generous support of the multi-donor program the Enhanced Integrated Framework (EIF). In every crisis there is an opportunity. Four years after the validation of the country’s first Diagnostic Trade Integration Study in 2008, Cape Verde finds itself in a drastically altered external environment. Cape Verde faces a worsened external environment than four years ago, when it was also traversing years of crisis as global food and energy prices escalated. Just as the country was validating its first trade study in late 2008, and celebrating its graduation from the list of Least Developed Countries, the onset of the deepest global recession in recent memory triggered an even worse external situation as the country’s principal source of markets, investments, remittances and aid, the Eurozone, unraveled economically and politically. As the Eurozone crisis spread, it was Cape Verde’s misfortune that the crisis contaminated precisely its biggest Eurozone partners and donors, such as Portugal, Spain and Italy. For such a highly dependent and exposed economy like that of Cape Verde, the deteriorating external sector has had a substantial negative impact on its macroeconomic performance. At the time of the validation workshop and graduation in 2008, no one could have foreseen or predicted the severity of the global crisis that followed. Despite traversing these years of adversity and external shocks, and suffering palpable setbacks, Cape Verde’s economy had proven surprisingly resilient, especially its principal sector, tourism. To its great credit, the country’s economic fundamentals are solid, and have been carefully and prudently managed over the years. For this reason alone, the country has thus far weathered the global and Eurozone crisis. Yet the near and medium term future remains uncertain. The country’s margin for maneuver has narrowed, its options far more limited, and hard choices lie ahead. Thus, there is no better time than now to analyze Cape Verde’s position in the global economy, and to examine the many challenges and opportunities it faces. The first diagnostic trade study outlined an ambitious agenda and set of policy strategies to enhance Cape Verde’s participation in the global economy. Written prior to the global crisis, the study did not, and could not, anticipate the scope and depth of the subsequent global and Eurozone crises. A few short months before the validation of the first DTIS Cape Verde joined the World Trade Organization (WTO). It has spent these four years adjusting to this status and implementing its commitments. At the same time, the country seeks greater economic integration with the European Union. Since 2008 the government has been investing heavily in the country’s economic infrastructure, focusing especially on fostering transformation in key sectors like agriculture, fisheries, tourism and creative industries. For these and many other reasons, it is both timely and urgent to review the road traveled since 2008. It is an opportune moment to reassess the country’s options, to rethink strategies, and to chart a new way forward that it is practical, implementable, and that builds on the country’s competitive advantages and current successes.

Trade and productivity

We estimate the effect of international trade on average laborproductivity at the country level. Our empirical approach relies onsummary measures of trade that, we argue, are preferable on boththeoretical and empirical grounds to the one conventionally used. Incontrast to the marginally significant and non-robust effects of tradeon productivity found previously, our estimates are highly significantand robust even when we include institutional quality and geographicfactors in the empirical analysis. We also examine the channels throughwhich trade and institutional quality affect average labor productivity.Our finding is that trade works through labor efficiency, whileinstitutional quality works through physical and human capitalaccumulation. We conclude with an exploratory analysis of the role oftrade policies for average labor productivity.

Nordic alcohol policy in Europe: the adaptation of Finland’s, Sweden’s and Norway’s alcohol policies to a new policy framework, 1994-2013

The purpose of this thesis is to study how and to which extent Finland, Sweden and Norway have adapted their alcohol policies to the framework imposed to them by the EU and the European Economic Area (EEA) since the mid-1990s. This is done by studying the underlying mechanisms that have influenced the formation of alcohol policy in the Nordic countries in that period. As a part of this analysis main differences in alcohol policies and alcohol consumption between the three countries are assessed and the phenomenon of cross-border trade with alcohol is discussed. The study examines also the development of Finnish, Norwegian and Swedish alcohol policies between 1994 and 2012 and compares the Nordic alcohol policies with other alcohol policies in Europe as the situation was in 2012. The time frame of the study spans from the mid-1990s to the end of 2013 and is divided into three phases. Studying the role of the Europeanisation process on the formation of alcohol policies has a key role in the analysis. Besides alcohol policies, the analyses comprise the development of alcohol consumption and cross-border trade with alcohol. In addition, a quantitative scale constructed to measure the strictness of alcohol policies is utilised in the analyses. The results from the scale are used to substantiate the qualitative analysis and to test whether the stereotypical view of a strict Nordic alcohol policy is still true. The results from the study clearly corroborate earlier findings on the significance of Europeanisation and the Single Market for the development of alcohol policies in the Nordic countries. Free movement of goods and unhindered competition have challenged the principle of disinterest and enabled private profit seeking in alcohol trade. The Single Market has also contributed to the increase in availability of alcohol and made it more difficult for the Nordic EU member states to maintain restrictive alcohol policies. All in all, alcohol policies in the Nordic countries are more liberal in 2013 than they were in 1994. Norway, being outside the EU has, however, managed to maintain a stricter alcohol policy than Finland and Sweden. Norway has also been spared from several EU directives that have affected Finland and Sweden, the most remarkable being the abolishment of the travellers’ import quotas for alcohol within the EU. Due to its position as a non-EU country Norway has been able to maintain high alcohol taxes without being subjected to a ”race to the bottom” regarding alcohol taxes the same way as Finland and Sweden. Finland distinguishes as the country that has liberalised its alcohol policy most during the study period. The changes in alcohol policies were not only induced by Europeanisation and the Single Market, but also by autonomous decision-making and political processes in the individual countries. Furthermore, the study shows that alcohol policy measures are implemented more widely in Europe than before and that there is a slow process of convergence going on regarding alcohol policy in Europe. Despite this, alcohol policies in the Nordic countries are still by far the strictest in all of Europe. From a Europeanisation perspective, the Nordic countries were clearly on the receiving end during the first two study phases (1994–2007), having more to adjust to rules from the EU and the Single Market than having success in uploading and shaping alcohol policy on the European and international field. During the third and final study phase (2008–2013), however, the Nordic countries have increasingly succeeded in contributing to shape the alcohol policy arena in the EU and also more widely through the WHOs global alcohol strategy. The restrictive Nordic policy tradition on which the current alcohol policies in Finland, Sweden and Norway were built on has still quite a solid evidence base. Although the basis of the restrictive alcohol policy has crumbled somewhat during the past twenty years and the policies have become less effective, nothing prevents it from being the base for alcohol policy in the Nordic countries even in the long term. In the future, all that is needed for an effective and successful alcohol policy is a solid evidence base, enough political will and support from the general public.

From Fordism to neoconservatism : free trade and Canadian industrial policy in an era of globalism /

Nothing today affects the lives of people in countries throughout the industrialized and developing world as much as international trade. Nowhere is this more true than in Canada. Canada's involvement in international trade has a long history dating back to 1854 when it was a British colony. As a major trading country, Canada has always adopted a proactive industrial policy which has been largely responsible for its relative economic prosperi ty. But, wi th businesses now free to invest and divest under the terms of the CUFTA and the NAFTA, the most fundamental concerns for Canadians, in a borderless world, are what powers will the Canadian government have to shape industrial policy, and to what extent can Canada continue as a viable nationstate if it can no longer control its national economy? These are important concerns because, in world without borders, the adjustment process becomes more volatile and more difficult to manage. The CUFTA and the NAFTA not only create the rules for conducting trade, but they also establish a set of new rules for the Canadian government that will diminish its power. As a member of a new North American trading bloc, Canada will find itself subject to a set of forces requiring analysis beyond participation in a conventional free trade area. Because many of the traditional levers of government will now be subject to external control imposed by these agreements, Canada will not be able to mount certain policies in the future that it has relied on in the past. This reality limits the pro-active role of the Canadian state to use policies and programmes for the country's immediate national development. What this thesis attempts is an examination of the evolution of Canadian industrial policy, in effect, the transi tion from Fordism to Neoconservatism, and an assessment of Canada's future as a nation-state as it tries to find security and improved access in a free trade arrangement. Unless Canada takes steps to neutralize the asymmetry of power between itself and the United States through adjustment programmes, it is the contention of this thesis that its economic future is anything but stable.

Bundling under the Threat of Parallel Trade

This paper examines the use of bundling by a firm that sells in two national markets and faces entry by parallel traders. The firm can bundle its main product, - a tradable good- with a non-traded service. It chooses between the strategies of pure bundling, mixed bundling and no bundling. The paper shows that in the low-price country the threat of grey trade elicits a move from mixed bundling, or no bundling, towards pure bundling. It encourages a move from pure bundling towards mixes bundling or no bundling in the high-price country. The set of parameter values for which the profit maximizing strategy is not to supply the low price country is smaller than in the absence of bundling. The welfare effects of deterrence of grey trade are not those found in conventional models of price arbitrage. Some consumers in the low-price country may gain from the threat of entry by parallel traders although they pay a higher price. This is due to the fact that the firm responds to the threat of arbitrageurs by increasing the amount of services it puts in the bundle targeted at consumers in that country. Similarly, the threat of parallel trade may affect some consumers in the hight-price country adversely.

Pursuing a Developmental State Trade Agenda in a Neo-Liberal Context

This book explains why it was possible for the Worker’s Party (PT) in Brazil and the African National Congress (ANC) in South Africa to pursue a developmental state trade policy, in spite of neoliberal constraints. The major theoretical lenses are three-fold. It applies state theory (macrolevel), policy network analysis (meso-level) and theories on political parties with emphasis on factional politics (micro-level). This book highlights the socio-political relevance of comparatively progressive policy frameworks and expands the debate on how to re-gain national policy space for progressive reform policies even under neoliberal constraints.

Poverty impacts of increased openness and fiscal policies in a dollarized economy: a CGE-micro approach for Ecuador

We quantify the effects on poverty and income distribution in Ecuador of bilateral trade liberalization with the US and a budget-neutral value added tax increase which seeks to compensate tariff revenue losses. We stress the study of fiscal policies that the government could tap in order to compensate for tariff revenue loss. This is a very important issue for Ecuador because this country adopted the US dollar as its currency in 2000, forgiving the use of important policy instruments. To study these issues we combine a reduced-form micro household income and occupational choice model (using 2005/6 data from the Ecuadorian LSMS) with a standard single-country computable general equilibrium model (employing a 2004 SAM). We follow a sequential approach that simulates the full distributional impact of trade and tax policies. We find that the impact of these policy changes on extreme poverty and income distribution is small but positive.

Europe’s New Post-Trade Infrastructure Rules. ECMI Policy Brief No. 20, 8 November 2012

After more than a decade of indecision, the EU is finally now set to implement a consistent regulatory architecture for clearing and settlement. Following the agreement on a European market infrastructure Regulation (EMIR), the European Commission has proposed harmonised rules for centralised settlement depositaries (CSDs), while the European Central Bank is moving forward with its plans for a central eurozone settlement engine. This paper analyses three components of the new post-trade infrastructure measures: 1) the regulatory framework for and supervision of central counterparties under the new EMIR legislation, 2) the authorisation requirements of trade repositories and 3) the draft CSD Regulation and the progress with the ECB’s Target 2 Securities project. It then discusses the impact of the new rules, and argues that, analogous to the unexpected impact of MiFID on trading infrastructures, a similar EMIR revolution may be on its way.

Agribusiness Opportunity Costs and Environmental Legal Protection: Investigating Trade-Off on Hotspot Preservation in the State of So Paulo, Brazil

Prior to deforestation, So Paulo State had 79,000 km(2) covered by Cerrado (Brazilian savanna) physiognomies, but today less than 8.5% of this biodiversity hotspot remains, mostly in private lands. The global demand for agricultural goods has imposed strong pressure on natural areas, and the economic decisions of agribusiness managers are crucial to the fate of Cerrado domain remaining areas (CDRA) in Brazil. Our aim was to investigate the effectiveness of Brazilian private protected areas policy, and to propose a feasible alternative to promote CDRA protection. This article assessed the main agribusiness opportunity costs for natural areas preservation: the land use profitability and the arable land price. The CDRA percentage and the opportunity costs were estimated for 349 municipal districts of So Paulo State through secondary spatial data and profitability values of 38 main agricultural products. We found that Brazilian private protected areas policy fails to preserve CDRA, although the values of non-compliance fines were higher than average opportunity costs. The scenario with very restrictive laws on private protected areas and historical high interest rates allowed us to conceive a feasible cross compliance proposal to improve environmental and agricultural policies.

Library Privacy Policies in 2015: Strategies for Renewed Relevance

In recent decades, library associations have advocated for the adoption of privacy and confidentiality policies as practical support to the Library Code of Ethics with a threefold purpose to (1) define and uphold privacy practices within the library, (2) convey privacy practices to patrons and, (3) protect against potential liability and public relations problems. The adoption of such policies has been instrumental in providing libraries with effective responses to surveillance initiatives such as warrantless requests and the USA PATRIOT ACT. Nevertheless, as reflected in recent news stories, the rapid emergence of data brokerage relationships and technologies and the increasing need for libraries to utilize third party vendor services have increased opportunities for data surveillers to access patrons’ personal information and reading habits, which are funneled and made available through multiple online library service platforms. Additionally, the advice that libraries should “contract for the same level of privacy reflected in their privacy policies” is no longer realistic given that the existence of multiple vendor contracts negotiated at arms length is likely to produce varying privacy terms and even varying definitions of what constitutes personal information (PII). These conditions sharply threaten the effectiveness and relevance of library privacy policies and privacy initiatives in that such policies increasingly offer false comfort by failing to reflect privacy weaknesses in the data sharing landscape and vendor contracts when library-vendor contracts fail to keep up with vendor data sharing capabilities. While some argue that library privacy ethics are antiquated and rendered obscure in the current online sharing economy PEW studies point to pronounced public discomfort with increasing privacy erosion. At the same time, new directions in FTC enforcement raise the possibility that public institutions’ privacy policies may serve as swords to unfair or deceptive commercial trade practices – offering the potential of renewed relevance for library privacy and confidentiality policies. This dual coin of public concern and the potential for enhanced FTC enforcement suggests that when crafting privacy polices libraries must now walk the knife’s edge by offering patrons both realistic notice about the limitations of protections the library can ensure while at the same time publicly holding vendors accountable to library privacy ethics and expectations. Potential solutions for how to walk this edge are developed and offered as a subject for further discussion to assist the modification of model policies for both public and academic libraries alike.

Uma avaliação da economia convencional ou abandonando-se o trade off eficiência equidade

O objetivo desta proposta é discutir os limites da análise walrasiana convencional e apresentar uma alternativa a ela. Os limites daquela análise são o de supor custos zero de transação e normas e preferências dos agentes dados exogenamente. A visão alternativa considera que muitas e importantes transações no capitalismo, chamados relações contestadas, demandam custos de controle e monitoramento, e podem gerar endogenamente diferentes formas de comportamentos. Estas condições podem dar lugar a fundamentos alternativos para as análises micro e macroeconômicos bem como ver implicações importantes para as políticas de estabilização.

On the growth effects of barriers to trade

We study the macroeconomic effects of international trade policy by integrating a Hecksher-Ohlin trade model into an optimal-growth framework. The model predicts that an open economy will have higher factor productivity and faster growth. Also, under protectionist policies there may be “development traps,” or additional steady states with low income. In the last case, higher tariffs imply lower incomes, so that the large cross-country differences in barriers to trade may explain part of the huge dispersion of per capita income observed across countries. The model simulation shows that the link between trade and macroeconomic performance may be quantitatively important.