Water use and salinity in the MurrayÐDarling Basin: a state-contingent model

The MurrayÐDarling Basin comprises over 1 million square kilometres; it lies within four states and one territory; and over 12,800 gigalitres of irrigation water is used to produce over 40 per cent of the nation's gross value of agricultural production. The supply of water for irrigation is subject to climatic and policy uncertainty. The object of the present paper is to show how the linear and nonlinear programming models commonly used in modelling problems such as those arising in the MurrayÐDarling Basin may be adapted to incorporate a state-contingent representation of uncertainty.Murray model state-contingent

Developing digital literacy in construction management education: a design thinking led approach

Alongside the digital innovations in AEC (Architectural, Engineering and Construction) practice, are calls for a new type of digital literacy, including a new information-based literacy informed by creativity, critical analysis and the theoretical and practical knowledge of the construction profession. This paper explores the role of design thinking and the promotion of abductive problem situations when developing digital literacies in construction education. The impacts of advanced digital modelling technologies on construction management practices and education are investigated before an examination of design thinking, the role of abductive reasoning and the rise of normative models of design thinking workflows. The paper then explores the role that design thinking can play in the development of new digital literacies in contemporary construction studies. A three-part framework for the implementation of a design thinking approach to construction is presented. The paper closes with a discussion of the importance of models of design thinking for learning and knowledge production, emphasising how construction management education can benefit from them

State-contingent modelling of the Murray Darling Basin: implications for the design of property rights

Questions relating to the allocation and management of risk have played a central role in the development of the National Water Initiative, particularly as it has applied to the Murray-Darling Basin. The central issues of efficiency and equity in allocations are best understood by considering water licenses as bundles of state-contingent claims. The interaction of property rights and uncertainty regarding water flows, production and output prices is modelled using a state-contingent representation of production under uncertainty. The role of technology and investment in the determination of efficient adaptation strategies to manage risks is explored using an illustrative example.

Redesigning work organizations and technologies: experiences from European projects

Currently distributed business process (re) design (resulting in components of business networks) basically relies on technical criteria. And that are the main purposes of most research projects supported by EC. Through the process of building a European Research Area, this means a strong influence in the national research programmes. However it is generally accepted that it should also take into account social criteria and aspects such as the quality of working life, or participation in decision processes. Those were some of the objectives of projects in de 80s decade, and framed some of the main concepts and scientific approaches to work organisation. The democratic participation of network and organisations members in the design process is a critical success factor. This is not accepted by everyone, but is based in sufficient case studies. Nevertheless, in order to achieve an optimization that can satisfying the requirements of agility of a network of enterprises, more complex design methods must be developed. Thus, the support to the collaborative design of distributed work in a network of enterprises, through a concurrent approaching business processes, work organisation and task content is a key factor to achieve such purposes. Increasing needs in terms of amounts of information, agility, and support for collaboration without time and space constrains, imposes the use of a computer-based model.business process; networks; decision processes; collaborative design;

The Copula Approach to Sample Selection Modelling: An Application to the Recreational Value of Forests

The sample selection model is based upon a bivariate or a multivariate structure, and distributional assumptions are in this context more severe than in univariate settings, due to the limited availability of tractable multivariate distributions. While the standard FIML estimation of the selectivity model assumes normality of the joint distribution, alternative approaches require less stringent distributional hypotheses. As shown by Smith (2003), copulas allow great flexibility also in FIML models. The copula model is very useful in situations where the applied researcher has a prior on the distributional form of the margins, since it allows separating their modelling from that of the dependence structure. In the present paper the copula approach to sample selection is first compared to the semiparametric approach and to the standard FIML, bivariate normal model, in an illustrative application on female work data. Then its performance is analysed more thoroughly in an application to Contingent Valuation data on recreational values of forests.Contingent valuation, Selectivity bias, Bivariate models, Copulas

Proliferation of risk and policy responses in the EU financial markets

Summary for non-specialistsThis study draws attention to the proliferation of tail risks in financial markets prior to and during the course of the recent global financial crisis. It examines the level of tail risks in selected equity, interbank lending and foreign exchange markets in selected EU Member States in relation to the United States. The extent of tail risks is assessed by applying general error distribution (GED) parameterization in GARCH volatility tests of the examined variables. The empirical tests prove that tail risks were pronounced across all of the examined European financial markets throughout the crisis. They were also significant prior to the crisis outbreak. The analyzed interbank lending markets exhibited more extreme volatility outbursts than the equity and foreign exchange markets. Several countercyclical monetary and macroprudential policies aimed at abating tail risks are identified and discussed. Flexible capital adequacy and contingent capital requirements for financial institutions are advocated.Global financial crisis equity markets foreign exchange markets monetary policies macroprudential policies Orlowski

Water use and salinity in the Murray–Darling Basin: A state-contingent model

The supply of water for irrigation is subject to climatic and policy uncertainty. The object of the present paper is to show how the linear and non-linear programming models commonly used in modelling problems such as those arising in the Murray–Darling Basin may be adapted to incorporate a state-contingent representation of uncertainty. Estimates showing the potential value of improved water use are also derived.irrigation, salinity, uncertainty, Resource /Energy Economics and Policy,

Climate change adaptation in industry and business

This report delivers a best practice framework to integrate financial risk assessment, governance and disclosure with existing governance principles around climate change adaptation.AbstractThe Australian business community has long been aware of the risks and opportunities associated with greenhouse gas mitigation and climate change policies. Some businesses have taken initial steps to adapt to the expected effects of climate change; however, most enterprises are only vaguely aware of the breadth of adaptation that may be required. Associated with strategic adaptation are the principles of financial/operational risk management and governance, as well as financial impact disclosure to investors and regulators. We develop a consolidated framework in which boards and executive managers can develop a robust approach to climate change adaptation governance, climate change risk assessment and financial disclosure. The project outlines a matrix of disclosures required for investors to enable them to evaluate corporate exposure to climate change risk.The project initially comprised a set of workshops with members of the Australian business community, industry representatives, regulatory authorities and academics with expertise in business risk and disclosure effects. Each workshop focused on a separate theme that built upon the work of previous workshops. A set of follow-up discussions was held with some of the key members who contributed to the project, including the Australian Stock Exchange (ASX) Investor Group on Climate Change (IGCC), the Australian Accounting Standards Board (AASB) and the Australian Institute of Company Directors. This discussion permitted each body to comment on the final report, advise on the mechanics of the costing, reporting and disclosure approaches of climate change adaptation, and lend their expertise to the formulation of an appropriate framework.The scope of the research is constrained to firm behaviour and the requirements for investor disclosure and governance of adaptation activities. The project therefore focuses on financial analyses – including real options – undertaken by firms with regard to investing in climate change adaptation activities and projects. While the economic costs and benefits are important to organisational adaptation activities, they represent a secondary level of analysis that may need to be carried out on either an independent or cumulative scale by governments or other bodies to measure the wider effects.As the degree of sophistication in climate change adaptation activities, modelling and cost estimation increases, along with the anticipated growth in interest of both company boards and managers, it is expected that accounting standards, ASX listing rules and disclosures required under the Corporations Act would need to explicitly reflect these corporate actions. The asset allocation of banks, mutual funds, superannuation funds and other investments is also likely to adapt as companies quantify their exposure to climate change. The makeup of assets in investment portfolios may therefore markedly shift, and thus indirectly adjust to the climate change adaptation activities of companies in the broader market

A linear algebraic method for pricing temporary life annuities and insurance policies

We recast the valuation of annuities and life insurance contracts under mortality and interest rates, both of which are stochastic, as a problem of solving a system of linear equations with random perturbations. A sequence of uniform approximations is developed which allows for fast and accurate computation of expected values. Our reformulation of the valuation problem provides a general framework which can be employed to find insurance premiums and annuity values covering a wide class of stochastic models for mortality and interest rate processes. The proposed approach provides a computationally efficient alternative to Monte Carlo based valuation in pricing mortality-linked contingent claims