nep-cmp New Economics Papers
on Computational Economics
Issue of 2006‒10‒07
four papers chosen by
Stan Miles
Thompson Rivers University

  1. Solving Lotsizing Problems on Parallel Identical Machines Using Symmetry Breaking Constraints By Jans, R.
  2. Klum@Gtap: Introducing Biophysical Aspects of Land-Use Decisions Into a General Equilibrium Model A Coupling Experiment By Kerstin Ronneberger; Maria Berrittella; Francesco Bosello; Richard S.J. Tol
  3. Regulation, Market Structure and Service Trade Liberalization By Denise Eby Konan; Ari Van Assche

  1. By: Jans, R. (Erasmus Research Institute of Management (ERIM), RSM Erasmus University)
    Abstract: Production planning on multiple parallel machines is an interesting problem, both from a theoretical and practical point of view. The parallel machine lotsizing problem consists of finding the optimal timing and level of production and the best allocation of products to machines. In this paper we look at how to incorporate parallel machines in a Mixed Integer Programming model when using commercial optimization software. More specifically, we look at the issue of symmetry. When multiple identical machines are available, many alternative optimal solutions can be created by renumbering the machines. These alternative solutions lead to difficulties in the branch-and-bound algorithm. We propose new constraints to break this symmetry. We tested our approach on the parallel machine lotsizing problem with setup costs and times, using a network reformulation for this problem. Computational tests indicate that several of the proposed symmetry breaking constraints substantially improve the solution time, except when used for solving the very easy problems. The results highlight the importance of creative modeling in solving Mixed Integer Programming problems.
    Keywords: Mixed Integer Programming;Formulations;Symmetry;Lotsizing;
    Date: 2006–09–20
  2. By: Kerstin Ronneberger (Deutsches Klimarechenzentrum GmbH); Maria Berrittella (University of Palermo); Francesco Bosello (Fondazione Eni Enrico Mattei and International Centre for Theoretical Physics); Richard S.J. Tol (Princeton University, Vrije Universiteit and Hamburg University)
    Abstract: In this paper the global agricultural land use model KLUM is coupled to an extended version of the computable general equilibrium model (CGE) GTAP in order to consistently assess the integrated impacts of climate change on global cropland allocation and its implication for economic development. The methodology is innovative as it introduces dynamic economic land-use decisions based also on the biophysical aspects of land into a state-of-the-art CGE; it further allows the projection of resulting changes in cropland patterns on a spatially more explicit level. A convergence test and illustrative future simulations underpin the robustness and potentials of the coupled system. Reference simulations with the uncoupled models emphasize the impact and relevance of the coupling; the results of coupled and uncoupled simulations can differ by several hundred percent.
    Keywords: Land-Use Change, Computable General Equilibrium Modeling, Integrated Assessment, Climate Change
    JEL: C68 Q15
    Date: 2006–08
  3. By: Denise Eby Konan; Ari Van Assche
    Abstract: In this paper, we develop a method to quantify the importance of regulation and market structure on the success of trade liberalization. For this purpose, we incorporate a single imperfectly competitive service sector that can take on various market structures into a standard computational general equilibrium model. We apply our framework to analyze the impact of allowing a single foreign telecom provider to enter Tunisia. If the regulation environment guarantees competition, Tunisia’s welfare can improve up to 0.65 percent. If a cartel is formed between the domestic incumbent and foreign entrant, however, Tunisia’s welfare can drop up to 0.25 percent. Our results thus call for Tunisia among other developing countries to step up its procompetitive regulatory reforms while liberalizing its telecom sector. <P>Dans ce papier, nous développons une méthode permettant de quantifier l’importance de la réglementation et de la structure des marchés sur la libéralisation du commerce et sur son succès. À ces fins, nous incorporons un secteur unique et imparfaitement compétitif pouvant intégrer différentes structures de marché dans un modèle standard de calcul d’équilibre général. Nous appliquons notre cadre d’analyse afin d’étudier l’impact de l’entrée d’un seul fournisseur étranger en Tunisie. Nous trouvons que si la réglementation du marché y garantit la compétition, le bien-être de la Tunisie peut augmenter de 0,65 %. Cependant, s’il y a formation d’un cartel entre le réseau domestique et l’entrant étranger, le bien-être de la Tunisie peut baisser de 0,25 %. Nos résultats démontrent que tout en libéralisant son secteur des télécommunications, la Tunisie bénéficierait de réformes visant des régulations pro-compétitives.
    Keywords: service trade liberalization, regulation, market structure, imperfect competition, CGE (Computable General Equilibrium), CGE (équilibre général calculable), compétition imparfaite, libéralisation du commerce, réglementation, structure de marché
    JEL: F12 F13 F23
    Date: 2006–09–01
  4. By: Siva Athreya (Indian Statistical Institute); Rohini Somanathan (Delhi School of Economics)
    Abstract: We show how an optimization algorithm can be used to approximately quan-tify the costs to users of spatial misallocation in centrally provided public goods. This method can be employed to evaluate the large programs of public good construction that have been central features of economic plans in many developing countries. We apply these methods to the allocation of post-offices in an administrative block of South India between 1981-1991 and find that more appropriate choices for post office locations could have reduced aggregate costs of travel to citizens in this area by at least 20%.
    JEL: H41 C61
    Date: 2006–08

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