|
on Network Economics |
| By: | Belleflamme, Paul; Peitz, Martin |
| Abstract: | We analyze whether and how the fact that products are not sold on open or public platforms but on competing for-profit platforms affects sellers’ investment incentives. Investments in cost reduction, quality, or marketing measures are here the joint and coordinated efforts by sellers. We show that, in general, for-profit intermediation is not neutral to such investment incentives. As for-profit intermediaries reduce the rents that are available in the market, one might suspect that sellers have weaker investment incentives with competing for-profit platforms. However, this is not necessarily the case. The reason is that investment incentives affect the size of the network effects and thus competition between intermediaries. In particular, we show that whether for-profit intermediation raises or lowers investment incentives depends on which side of the market singlehomes. |
| Keywords: | intermediation; investment incentives; network effects; two-sided markets |
| JEL: | D40 L10 |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:6214&r=net |
| By: | Mathur, Somesh Kumar |
| Abstract: | India's software and services exports have been rising rapidly. The annual growth rate ranges between 20 -22% in IT services and nearly 55 % in IT-enabled services (ITES), such as call centres, Business Process Outsourcing ( BPO) and other administrative support operations. Together they are predicted to grow at 25% pa till 2010.The IT industry is highly export oriented and the exporters are predominantly Indian. The Indian BPOs (ITES) are moving up the value chain, handling high end data for airline information, insurance, banking sector and mortgage companies, enterprise resource planning, among others. Some of the companies have already moved into significantly higher value added segments such as mission- critical applications, development and support, product design, HR Management, knowledge process outsourcing for pharmaceutical companies and large complex projects. Software exports make up 20 % of India's total export revenue in 2003-04, up from 4.9 % in 1997.This figure is expected to go up to 44% of annual exports by 2010. Though India accounts for just about 3 % of the world market for information technology services, this sector has been growing at a scorching pace, helped by a large pool of English-speaking workers, nearly 4 million engineers and the increasing tribe of tech-savvy entrepreneurs in the country. The Information Technology industry currently accounts for almost 4.8 % of India's GDP. It will account for 7 % of India's GDP by 2010. Software and IT enabled services have emerged as a niche sector for India. This was one of the fastest growing sectors in the last decade with a compound annual growth rate exceeding 50 per cent. Software service exports increased from US $ 0.50 million in 1990 to $5.9 billion in 2000-01 to 23.6 billion dollars in 2005-06 recording a 34% growth. A compound annual growth of over 25% per annum is expected over the next 5 years even on the expanding base. The impact on the economy of projected software and IT enabled service exports of $ 60 billion by 2010 is likely to be profound. One manifestation is that India notched up a current account surplus in 2001-02, for the first time in 24 years. India further needs an open environment under GATS to promote exports of services through outsourcing and off-shoring . The present study examines the growth performance of India’s IT industries, with particular attention paid to the role of policy in this process. The study recognizes that emergence of a strong Indian IT industry happened due to concerted efforts on the part of the Government, particularly since 1980s, and host of other factors like Government-Diaspora relationships, private initiatives, emergence of software technology parks, clustering and public private partnerships. In this study we further look at the major parameters of the Indian IT and ICT industry in global context and give justification for including the main factors responsible for the IT boom in India. The study has looked into the past and present trends of the Indian IT industry and has considered further needs of IT sector to act as a catalyst of growth and development. The study has examined whether the Indian IT growth does have enough lessons for other countries to model their IT policy which may help them to shape their IT industry as driver of growth and development. IT firms were actually required to export software in the early days of the industry. This arose in the context of a shortage of foreign exchange in India in the 1970s and early 1980s.Software firms that needed imported inputs were required to earn foreign exchange themselves through export of software. This enabled them to get an idea of global markets very early. Besides formulating the national vision to promote software industry in India in the early 1980s by the government, there were deliberate attempt by the companies to promote software production like compilers, device drivers and operating system to cater to the domestic hardware sector. The high tariffs for the hardware sector had meant that the production of domestic hardware segment (including PCs which were introduced in the same period) had to be sustained requiring necessary software’s like operating system and drivers. Subsequently by mid 1980s, software started coming up unbundled with the hardware. This further gave fillip to the software industry and exports. The 1990s and early 2000 saw the rise of Software Technology Parks and formation of the Ministry of Information Technology, respectively. Despite liberalization of the 1991, the software industry flourished signifying the inherent strength that it developed due to benign and enabling environment provided over a period of time and also the fact that the 1990s saw the dramatic decline in telecommunication costs (government explicit intervention) and the commercialization of the internet along with the Y2K “problem”. The Data Envelopment Analysis (DEA) model is used to work out technical efficiency of Information and Communication Technology ( ICT) Industry in host of countries which are front runners as far as ICT is concerned. India lags behind the most as far as ICT (not IT) is concerned. However, information and Communication technology industry has brought revolution in India because it has reduced intermediation in business and society, provided solutions across sectors and is increasingly becoming an important tool for national development. DEA is also applied to benchmark the performance of the 92 Indian Software Companies for 2005- 2006. The impact of various determinants on technical efficiency of the Indian Software companies is worked out using tobit regression. The impact of the explanatory factors on net exports of 92 software firms in 2005-06 is also worked out using simple regression exercise. The study also works out technical efficiency of 36 telecommunication firms in India and examines the determinants for new technology adoption by such industries. The study uses a Malmquist index to estimate total factor productivity changes decomposed into efficiency change( catching up to the frontier technology) and technical change( movement of the frontier) for the common software firms existing between 1996 and 2006 E-government is the application of Information and Communication Technologies (ICT) by government agencies. Its use promises to enhance the effectiveness and efficiency of government and alter its relationship with the public. The study outlines E-Governance models for effective governance and for higher agricultural growth and development. E-Commerce primarily refers to buying, selling, marketing and servicing of products or services over internet and other computer networks. E-Commerce in India is just taking off with the advent of Railway and Online Air bookings and Net banking. The business is likely to grow to Rs 2300 crore by 2007 .Electronic commerce allows efficient interactions among customer, suppliers and development partners cutting down on transaction time and reducing the costs of doing business. The role of government is to facilitate the development of E-Commerce. For promoting South-South Cooperation and making it meaningful, the governments of the member countries need to pool resources and capabilities in R&D and human resource development for harnessing the fruits of Information and Communicating technologies. The study spells out in detail a number of examples where ICT has been used by rural communities for their benefit and for policy and development goals of the government in general. Web based software development and software product development (like device drivers) is necessary for providing complete business and consumer oriented solutions. These are also areas of interest for the Indian IT entrepreneurs to work upon in times to come. India’s relatively unsafe e-security environment is costing the BPO/ITES industry. The new IT Act (2000) needs to crucially define cyber harassment, phishing and cyber stalking to take care of cyber crimes in India. With the Indian IT/BPO exports to reach $60 billion by 2010, such companies need to invest in upgrading security measures for sustaining competitiveness. Organizations are not obliged under the IT Act to implement data security measures to protect consumers and clients. All this makes it obvious that qualitative progress cannot be made without enacting comprehensive data protection legislation. The Information and communication technologies (ICT) indicators of India are 13 million PCs, 40 million internet users- country with the fifth-largest number of Internet users,143 million mobile phones and 60 million subscribers for fixed lines in 2006. These are modest figures in comparison with the ICT penetration indicators achieved by the front runners like Taiwan, South Korea, Japan, UK, US, Nordic countries in Europe, among others (see the text for our strength and weaknesses in the ICT infrastructure in comparison with some other front runner countries). India’s Strengths lies in its availability of pool of scientists and engineers and quality of maths and science education along with quality of business schools. We are also ranked quite high in terms of cluster development, foreign technology licensing and Government prioritization of ICT. The weaknesses are the telecommunication infrastructure and speed of new business registration. However, Information and communication technologies(ICT) has brought about revolution in India particularly since 1990s .This is because it has reduced intermediation in business and society, reduced mobile and fixed telephony rates(because of concerted policy interventions by the government), provided solutions across sectors, provided both CDMA and GSM mobile technologies (and now Wi-Max technologies for internet access at different public places using PC), re-organizing firm level behavior, empowering individuals by providing them with more information and is increasingly becoming an important tool for national and rural development through E-governance, E-Banking and E- Commerce programmes. In addition, the success of the Information Technology industry in India is intertwined with information and communication technologies as most of the Information technology enabled services use such technologies for providing their services. The quantitative results of the paper answers the following- what orientations in inputs should be done by inefficient software and telecommunication firms and ICT Industry in general to reach the ‘ best practice frontier’( and have operational excellence), examines the relationship between technical efficiency and net exports of software firms along with the impact of host of explanatory factors like size of firms in terms of sales and total cost, among others on technical efficiency and net exports for cross section of software firms using tobit analysis, gives some reasons for relatively low ICT penetration in India and what can be done to transform India’s relatively good ICT readiness and ICT environment into higher ICT usage, answers why telecommunication firms are adopting new technologies and estimates total factor productivity changes in software firms which can be further used to model wage and price estimation of products and services offered by software firms over time. The paper confirms the improvements in productivity, efficiency change and technical change of the Indian Software industry from 1996 to 2006. Synopsis Chapter Wise Chapter one describes the major parameters of the Indian Information Technology (IT) Industry in India today and in the immediate past. The chapter further analyzes the reason for the ‘boom’ in the Indian IT sector. We also outline an electronic governance Model which can become a tool for effective governance. DEA is applied to benchmark the performance of the 92 Indian Software Companies for 2005- 2006. The impact of various determinants on technical efficiency of the Indian Software companies is worked out using tobit regression. The impact of the explanatory factors on net exports of 92 software firms in 2005-06 is also worked out using simple regression exercise. . Further this chapter uses a Malmquist index to estimate total factor productivity changes decomposed into efficiency change and technical change for the common software firms existing between 1996 and 2006. Chapter two gives an account of the position of the Indian Information Technology (IT) Industry and the Indian Information and Communication Technology (ICT) Industry in the global context and analyzes the strengths and weaknesses of ICT Infrastructure across some countries. Technical Efficiency of the Indian ICT sector is worked out using the mathematical model of Data Envelopment Analysis. The study also works out technical efficiency of 36 telecommunication firms in India and examines the determinants for new technology adoption by such industries. Chapter Three describes why and how the Indian IT industry can act as a catalyst of growth and development. An account of an effective electronic governance model for Agriculture Sector is also given. Chapter Four looks at the past of IT industry since 1960s keeping policy in mind. This chapter also outlines an export success model . Such models can be emulated by other countries. Chapter five describes the hurdles and constraints faced by the India IT industry and give an account of the policies and strategies which can be adopted to address the hurdles and concerns of the ICT sector. The last Chapter gives the conclusions, suggestions and policy advice for making IT as a tool for addressing some core inadequacies in the system like poverty, inequality, healthcare and education, among others. |
| Keywords: | IT; ICT; ITPOLICY; OUTSOURCING; DEA ANALYSIS; TECHNICAL EFFICIENCY; TOBIT; NETEXPORTS; MALMQUIST INDEX; TOTAL FACTOR PRODUCTIVITY CHANGE; EFFICIENCY CHANGE; TECHNICAL CHANGE |
| JEL: | L86 |
| Date: | 2007–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:2368&r=net |
| By: | Yann Bramoullé (CIRPÉE, Université Laval); Habiba Djebbari (CIRPÉE, Université Laval and IZA); Bernard Fortin (CIRPÉE, Université Laval) |
| Abstract: | We provide new results regarding the identification of peer effects. We consider an extended version of the linear-in-means model where each individual has his own specific reference group. Interactions are thus structured through a social network. We assume that correlated unobservables are either absent, or treated as fixed effects at the component level. In both cases, we provide easy-to-check necessary and sufficient conditions for identification. We show that endogenous and exogenous effects are generally identified under network interaction, although identification may fail for some particular structures. Monte Carlo simulations provide an analysis of the effects of some crucial characteristics of a network (i.e., density, intransitivity) on the estimates of social effects. Our approach generalizes a number of previous results due to Manski (1993), Moffitt (2001), and Lee (2006). |
| Keywords: | peer effects, social networks, identification |
| JEL: | D85 L14 Z13 C3 |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2652&r=net |
| By: | Lei Zhang; David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota) |
| Abstract: | A number of factors influence the efficiency, productivity, and welfare of a transportation network. Travel demand, user costs, and facility supply costs equilibrate on various time scales under a set of pricing (taxes and tolls), investment and ownership policies. Two types of equilibria exist in a transportation network, short-run traffic equilibrium and long-run supply-demand equilibrium. The phenomenon of traffic equilibrium is explored with a fixed transportation network where the capacity of links is given. Even though investment- and ownership-related policies are not of major concern for studies on traffic equilibrium, it is still a complex problem due to network congestion effects, variations of pricing rules, and multidimensionality of user choices. In order to understand the long-run supply-demand equilibrium in a transportation network, one has to consider all above-mentioned factors in a coherent analytical framework. We refer to this research problem as the transportation network growth problem, because the network evolves and link capacity is not fixed in the long run. Most previous studies have considered network pricing, investment, and ownership structures separately, which are reviewed. The paper considers choices of prices, capacity, and ownership simultaneously on small parallel, serial, and parallel-serial networks, and develops an analytical network model. We discuss properties of long-run network equilibria with different network layouts and ownership regimes, and the implications on network efficiency. |
| Keywords: | Network economics, Modeling network dynamics, Road pricing, Transportation financing, Privatization. |
| JEL: | R41 R42 R48 D21 D24 D81 D83 C72 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:nex:wpaper:economicsofnetworkgrowth&r=net |
| By: | Lei Zhang; David Levinson; Shanjiang Zhu (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota) |
| Abstract: | Using consistent agent-based techniques, this research models the decision-making processes of users and infrastructure owner/operators to explore the welfare consequence of price competition, capacity choice, and product differentiation on congested transportation networks. Component models include: (1) An agent-based travel demand model wherein each traveler has learning capabilities and unique characteristics (e.g. value of time); (2) Econometric facility provision cost models; and (3) Representations of road authorities making pricing and capacity decisions. Different from small-network equilibrium models in prior literature, this agent-based model is applicable to pricing and investment analyses on large complex networks. The subsequent economic analysis focuses on the source, evolution, measurement, and impact of product differentiation with heterogeneous users on a mixed ownership network (with tolled and untolled roads). Two types of product differentiation in the presence of toll roads, path differentiation and space differentiation, are defined and measured for a base case and several variants with different types of price and capacity competition and with various degrees of user heterogeneity. The findings favor a fixed-rate road pricing policy compared to complete pricing freedom on toll roads. It is also shown that the relationship between net social benefit and user heterogeneity is not monotonic on a complex network with toll roads. |
| Keywords: | Network dynamics, road pricing, autonomous links, privatization, price competition, product differentiation, agent-based transportation model |
| JEL: | R40 R42 R48 D10 D21 D23 D24 D43 D83 D85 H21 H23 H44 L92 O33 C72 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:nex:wpaper:agentpricecompetition&r=net |
| By: | Lei Zhang; David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota) |
| Abstract: | This paper seeks to understand the economic impact of centralized and decentralized ownership structures and their corresponding pricing and investment strategies on transportation network performance and social welfare for travelers. In a decentralized network economic system, roads are owned by many agencies or companies that are responsible for pricing and investment strategies. The motivation of this study is two-fold. First, the question of which ownership structure, or industrial organization, is optimal for transportation networks has yet to be resolved. Despite several books devoted to this research issue, quantitative methods that translate ownership-related policy variables into short- and long-run network performance are lacking. Second, the U.S. and many other countries have recently seen a slowly but steadily increasing popularity of road pricing as an alternative to traditional fuel taxes. Not only is the private sector encouraged to finance new roads, this transition in revenue mechanism also makes it possible for lower-level government agencies and smaller jurisdictions to participate in network pricing and investment practice. The issue of optimal ownership is no longer a purely theoretical debate, but bears practical importance. This research adopts an agent-based simulator of network dynamics to explore the implications of centralized and decentralized ownership on mobility and social welfare, as well as potential financial issues and regulatory needs. Components of the simulator: the travel demand model, cost functions, and key variables of pricing and investment strategies, are empirically estimated and validated. Results suggest that road network is a market with imperfect competition. While there is a significant performance lag between the optimal strategy and the current network financing practice in the U.S. (characterized by centralized control, fuel taxes, and budget-balancing investment), a completely decentralized network suffers from issues such as higher-than-optimal tolls and over-investment. For the decentralized ownership structure, appropriate regulation on pricing and investment practices is necessary. Further analysis based on simulation comparisons suggests that with appropriate price regulation, a decentralized road economy consisting of profit-seeking road owners could outperform the existing centralized control, achieve net social benefits close to the theoretical optimum, and distribute a high percentage of welfare gains to travelers. Decentralized control is especially valuable in rapidly changing environments because it promptly responds to travel demand. These results seem to favor the idea of privatizing or decentralizing road ownership on congested networks. Further tests on real-world transportation networks are necessary and should make an interesting future study. |
| Keywords: | Network economics, Modeling network dynamics, Road pricing, Transportation financing, Privatization. |
| JEL: | R41 R42 R48 D21 D24 D81 D83 C72 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:nex:wpaper:erno&r=net |
| By: | David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota) |
| Abstract: | This paper first briefly reviews the history of private roads. Then the functional and economic classification of roadways is presented. Three different classes of roads (local, linking, and limited access) need to be treated in very different ways. The ideology of private roads is then presented. The political factors constraining this ideology from taking root are then presented. Distributional effects associated with privatization are described, and means for using the proceeds from the sale of roads to compensate losers are presented. Prospects for the future of private roads are discussed in the conclusions. |
| Keywords: | Network economics, Modeling network dynamics, Road pricing, Transportation financing, Privatization. |
| JEL: | R41 R42 R48 D21 D24 D81 D83 C72 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:nex:wpaper:politicaleconprivateroads&r=net |
| By: | Wuping Xin; David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota) |
| Abstract: | This paper proposes a stochastic congestion and pricing model that combines a bottleneck model with stochastic queuing to study roadway congestion and pricing. Employing this model, two pricing schemes are developed: one is omniscient pricing for which the transportation administrative agency is assumed to be aware of each and every traveler's cost structure (i.e., their detailed valuation of journey cost as well as early and late penalties), and the other is observable pricing, for which only queuing delay is considered. Travelers are characterized by their late-acceptance level and the effects of various compositions of late-averse, late-tolerant and late-neutral travelers on congestion patterns with and without pricing are discussed. Numerical simulation indicates that omniscient pricing scheme is most effective in suppressing peak hour congestion and distributing demands over longer time horizon. Also, congestion pricing is found to be more effective when travelers have diversified cost structures than identical cost structures, and congestion is better reduced with heterogeneous traveler composition than with single composition. This is consistent with earlier studies in the literature. In addition, the simulation results indicate that omniscient pricing in general reduces Expected Total Social Cost<(with or without the return of the congestion fee). However, the ultimate benefits of a certain pricing scheme depend on travelers' cost structure as well as the composition of late-tolerant, late-averse and late-neutral travelers in the entire population; extreme situations such as 100% late-averse or 100% late-tolerant traveler composition deserves extra attention when analyzing different pricing schemes. |
| Keywords: | Agent-based Model, Game Theory, Congestion, Queueing, Traffic Flow, Congestion Pricing, Road Pricing, Value Pricing |
| JEL: | R41 R42 R48 D10 D81 D83 C72 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:nex:wpaper:stochasticpricing&r=net |
| By: | David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota) |
| Abstract: | The politically-charged notion of network neutrality came to the fore in 2005 and 2006, using analogy from transportation as one of the key tools in motivating arguments. This paper examines how the various notions around network neutrality (common carriage, regulation, price discrimination) have played out in the transportation sector, and suggests many of the current arguments fail to understand the nuances of how complex networks actually operate to serve the many demands placed on them. |
| JEL: | R41 R42 R48 N71 N74 H41 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:nex:wpaper:networkneutrality&r=net |
| By: | Keizo Mizuno (School of Businiess Administration, Kwansei Gakuin University); Testuya Shinkai (School of Economics, Kwansei Gakuin University) |
| Abstract: | This paper provides a simple model that examines a firmfs incentive to invest in a network infrastructure through coalition formation in an open access environment with a deregulated retail market. A regulator faces a dilemma between inducing an incentive for efficient investment and reducing the distortion generated by imperfect competition. We show that, in such a case, the degree of cost-reducing effect of the investment is crucial from a welfare point of view. In particular, when network investment through coalition formation creates a large (small) cost-reducing effect, the regulator can (should not) delegate an investment decision to firms with an appropriate level of access charge. |
| Keywords: | Network infrastructure, Coalition, Access Charge, Delegation |
| JEL: | L13 L22 L43 L90 |
| Date: | 2006–01 |
| URL: | http://d.repec.org/n?u=RePEc:kgu:wpaper:28&r=net |
| By: | Feng Xie; David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota) |
| Abstract: | Transport infrastructure evolves over time in a complex process as part of a dynamic and open system including travel demand, land use, as well as economic and political initiatives. As transport infrastructure changes, each traveler may adopt a new schedule, frequency, destination, mode, and/or route, and in the long term may change the location of their activities. These new behaviors create demand for a new round of modifications of infrastructure. In the long run, we observe the collective change in the capacity, service, connectivity, and connection patterns (topology) of networks. Exploring the mechanism underlying this dynamic process can answer questions such as how urban networks have developed into various topologies, which networks patterns are more efficient, and whether and how transport engineers, planners, and decision makers can guide the dynamics of land uses and infrastructure in a desired direction. This paper examines how a fixed set of places incrementally gets connected as transport networks are constructed and upgraded over time. A Simulator Of Network Incremental Connection (SONIC) models these processes and examines how the incremental connections are actually implemented, as well as how networks evolve differently, with regard to connectivity and efficiency, under centralized versus decentralized jurisdictional control. The sensitivity of emergent topologies to some model parameters is also tested. |
| Keywords: | Network growth, Transport economics, Incremental connection |
| JEL: | R41 R42 R48 O33 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:nex:wpaper:sonic&r=net |
| By: | Ahmed El-Geneidy; David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota) |
| Abstract: | In an urban context people travel between places of residence and work destinations via transportation networks. Transportation studies that involve measurements of distances between residence and work locations tend to use Euclidean distances rather than Network distances. This is due to the historic difficulty in calculating network distances and based on assumptions that differences between Euclidean distance and network distance tend to be constant. This assumption is true only when variation in the network is minor and when self-selection is not present. In this paper we use circuity, the ratio of network to Euclidean distance, as a tool to better understand the choice of residential location relative to work. This is done using two methods of defining origins and destinations in the Twin Cities metropolitan region. The first method of selection is based on actual choice of residence and work locations. The second is based on a randomly selected dataset of origins and destinations in the same region. The findings of the study show circuity measured through randomly selected origins and destinations differ from circuity measured from actual origins and destinations. Workers tend to reside in areas where the circuity is lower, applying intelligence to their location decisions. We posit this because locators wish to achieve the largest residential lot at the shortest commute time. This finding reveals an important issue related to resident choice and location theory and how resident workers tend to locate in an urban context. |
| Keywords: | Network structure, travel behavior, transport geography, commuting, circuity |
| JEL: | R40 R11 R14 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:nex:wpaper:circuity&r=net |
| By: | Bastos Vareda, João Miguel; Hoernig, Steffen |
| Abstract: | We analyze the impact of mandatory access on the infrastructure investments of two competing communications networks, and show that for low (high) access charges firms wait (preempt each other). Contrary to previous results, under preemption a higher access charge can delay first investment. Constant access tariffs cannot achieve the first best. Optimal time-variant access tariffs may be increasing or decreasing over time. The first-best cannot be achieved at all through access tariff regulation if the follower’s private incentives are dominated by business-stealing. Here access holidays can improve welfare by allowing for lower future access charges, which delay the second investment. |
| Keywords: | Access holidays; Investments; Preemption; Time-variant access charges |
| JEL: | D92 L43 L51 L96 |
| Date: | 2007–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:6203&r=net |
| By: | Xi Zou; David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota) |
| Abstract: | Signal-based intersection management will change when vehicles with intelligent capability are available in the future. Intelligent agents embedded in vehicle software will be responsible for vehicle control and route guidance. Intersection management can be achieved through the collaboration of these agents, without a centralized control infrastructure. This research focuses on the use of distributed multi-agent systems to provide microscopic adaptive control which might reduce traffic delay and chances of collisions at intersections. A hypothesized Mobile Ad-hoc Network provides communication links to connect the agents. |
| Keywords: | Intelligent Agents, Adaptive Intersection Control |
| JEL: | R40 C78 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:nex:wpaper:vehicleagents&r=net |
| By: | Christian Ghiglino |
| Abstract: | In this paper we propose a mechanism generating innovations with productivity distributed according to a power law. We assume that knowledge creation occurs as new ideas are produced from combinations of existing ideas. The productivity of an innovation is determined by an unobservable intrinsic component as well as by the productivity of the parent ideas and their parents, thus generating a network of spillovers. The second important feature is that the innovator has no global information on the network of parenthood links across ideas but has acces to local knowledge, as for example the list of cited references in a patent. The optimal behaviour of the innovator is to "walk randomly" through the network of "citations" as this algorithm leads to selecting highly connected parent nodes. We show that the distribution of productivity resulting from this optimal behaviour follows a power law. The intuition behind the result is that the innovator focuses his efforts on strengthening local spillovers because he has no command on the other sources of productivity. When this process of innovation is imbedded in a model a la Kortum (1997) balanced growth of output is generated. |
| Date: | 2007–03–27 |
| URL: | http://d.repec.org/n?u=RePEc:esx:essedp:627&r=net |
| By: | Norah Montes de Oca; Feng Xie; David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota) |
| Abstract: | This research assesses the implications of existing trends on future network investment, comparing alternative scenarios concerning budgets and investment rules across a variety of performance measures. The main scenarios compare 'stated decision rules';, processes encoded in flowcharts and weights developed from official documents or by discussion with agency staff, with 'revealed decision rules', weights estimated statistically based on observed historical behavior. This research specifies the processes necessary to run the network forecasting models with various decision rules. Results for different scenarios are presented including adding additional constraints for the transportation network expansion and calibration process details. We find that alternative decision rules make only small differences in overall system performance, though they direct investments to very different locations. However, changes in total budget can make a significant difference to system-wide performance. |
| JEL: | R41 R42 R48 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:nex:wpaper:feng&r=net |
| By: | Michael Corbett; Feng Xie; David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota) |
| Abstract: | This paper describes and explains the growth of the Minneapolis Skyway network. Accessibility is used as a major factor in understanding that growth (i.e. does the network connect to the location(s) with the highest accessibility, followed by the second highest, and so on). First, employment opportunities are used as the measure of activity and are based off of the square footage of buildings and/or ITE trip generation rates. Using information about the buildings located downtown for each year since the first skyway was built, the accessibilities of each of the connected and adjacent unconnected blocks were calculated for every time period the skyway system expanded. The purpose is to determine how often the expansion connected the block with the highest accessibility. The results show that though important, accessibility was rarely maximized, except in the early stages of development. A connect-choice logit model relating the probability of joining the network (in a given year) to accessibility and network size was employed. The results show accessibility does remain an important factor in predicting which links are connected. Physical difficulties in making connections may have played a role, as well as the potential for adverse economic impacts. |
| Keywords: | Network growth, Transport economics, Incremental connection, Skyways, Minneapolis |
| JEL: | R41 R42 R48 O33 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:nex:wpaper:skyways&r=net |
| By: | Fabio, Sabatini |
| Abstract: | This paper provides an introduction to the concept of social capital, and carries out a critical review of the empirical literature on social capital and economic development. The survey points out six main weaknesses affecting the empirics of social capital. Identified weaknesses are then used to analyze, in a critical perspective, some prominent empirical studies and new interesting researches published in last two years. The need emerges to acknowledge, also within the empirical research, the multidimensional, context-dependent and dynamic nature of social capital. The survey also underlines that, although it has gained a certain popularity in the empirical research, the use of “indirect” indicators may be misleading. Such measures do not represent social capital’s key components identified by the theoretical literature, and their use causes a considerable confusion about what social capital is, as distinct from its outcomes, and what the relationship between social capital and its outcomes may be. Research reliant upon an outcome of social capital as an indicator of it will necessarily find social capital to be related to that outcome. This paper suggests to focus the empirical research firstly on the “structural” aspects of the concept, therefore excluding by the measurement toolbox all indicators referring to social capital’s supposed outcomes. |
| Keywords: | Social capital; Social networks; Trust; Economic development; Relation of economics to other disciplines; Relation of economics to social values. |
| JEL: | Z13 Z19 |
| Date: | 2005–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:2366&r=net |