Reallocating Multiple Facilities on the Line

We study the multistage $K$-facility reallocation problem on the real line, where we maintain $K$ facility locations over $T$ stages, based on the stage-dependent locations of $n$ agents. Each agent is connected to the nearest facility at each stage, and the facilities may move from one stage to another, to accommodate different agent locations. The objective is to minimize the connection cost of the agents plus the total moving cost of the facilities, over all stages. $K$-facility reallocation was introduced by de Keijzer and Wojtczak, where they mostly focused on the special case of a single facility. Using an LP-based approach, we present a polynomial time algorithm that computes the optimal solution for any number of facilities. We also consider online $K$-facility reallocation, where the algorithm becomes aware of agent locations in a stage-by-stage fashion. By exploiting an interesting connection to the classical $K$-server problem, we present a constant-competitive algorithm for $K = 2$ facilities

Facility Reallocation on the Line

We consider a multi-stage facility reallocation problems on the real line, where a facility is being moved between time stages based on the locations reported by $n$ agents. The aim of the reallocation algorithm is to minimise the social cost, i.e., the sum over the total distance between the facility and all agents at all stages, plus the cost incurred for moving the facility. We study this problem both in the offline setting and online setting. In the offline case the algorithm has full knowledge of the agent locations in all future stages, and in the online setting the algorithm does not know these future locations and must decide the location of the facility on a stage-per-stage basis. We derive the optimal algorithm in both cases. For the online setting we show that its competitive ratio is $(n+2)/(n+1)$. As neither of these algorithms turns out to yield a strategy-proof mechanism, we propose another strategy-proof mechanism which has a competitive ratio of $(n+3)/(n+1)$ for odd $n$ and $(n+4)/n$ for even $n$, which we conjecture to be the best possible. We also consider a generalisation with multiple facilities and weighted agents, for which we show that the optimum can be computed in polynomial time for a fixed number of facilities

The continuous p-centre problem: An investigation into variable neighbourhood search with memory

A VNS-based heuristic using both a facility as well as a customer type neighbourhood structure is proposed to solve the p-centre problem in the continuous space. Simple but effective enhancements to the original Elzinga-Hearn algorithm as well as a powerful ‘locate-allocate’ local search used within VNS are proposed. In addition, efficient implementations in both neighbourhood structures are presented. A learning scheme is also embedded into the search to produce a new variant of VNS that uses memory. The effect of incorporating strong intensification within the local search via a VND type structure is also explored with interesting results. Empirical results, based on several existing data set (TSP-Lib) with various values of p, show that the proposed VNS implementations outperform both a multi-start heuristic and the discrete-based optimal approach that use the same local search

Fiscal Update, June 15, 2005

The Fiscal Division newsletter, published weekly during session and periodically during the interim

"The Shift from Belt Conveyor Line to Work-cell Based Assembly Systems to Cope with Increasing Demand Variation and Fluctuation in The Japanese Electronics Industries"

As consumption patterns become increasingly sophisticated and manufacturers strive to improve their competitiveness, not only offering higher quality at competitive costs, but also by providing broader mix of products, and keeping it attractive by launching successively new products, the turbulence in the markets has intensified. This has impelled leading manufacturers to search the development of alternative production systems supposed to enable them operate more responsively. This paper discusses the trend of abandoning the strategy of relying on factory automation technologies and conveyor-based assembly lines, and shifting towards more human-centered production systems based on autonomous work-cells, observed in some industries in Japan (e.g. consumer electronics, computers, printers) since mid-1990s. The purpose of this study is to investigate this trend which is seemingly uneconomic to manufacturers established in a country where labor costs are among the highest in the world, so as to contribute in the elucidation of its background and rationality. This work starts with a theoretical review linking the need to cope with nowadays' market turbulence with the issue of nurturing more agile organizations. Then, a general view of the diffusion trend of work-cell based assembly systems in Japanese electronics industries is presented, and some empirical facts gathered in field studies conducted in Japan are discussed. It is worthy mentioning that the abandonment of short cycle-time tasks performed along conveyor lines and the organization of workforce around work-cells do not imply a rejection of the lean production paradigm and its distinctive process improvement approach. High man-hour productivity is realized as a key goal to justify the implementation of work-cells usually devised to run in longer cycle-time, and the moves towards this direction has been strikingly influenced by the kaizen philosophy and techniques that underline typical initiatives of lean production system implementation. Finally, it speculates that even though the subject trend is finding wide diffusion in the considered industries, it should not be regarded as a panacea. In industries such as manufacturing of autoparts, despite the notable product diversification observed in the automobile market, its circumstances have still allowed the firms to rely on capital-intensive process, and this has sustained the development of advanced manufacturing technologies that enable the agile implementation and re-configuration of highly automated assembly lines.

The republic of Congo's infrastructure : a continental perspective

Infrastructure contributed half a percentage point to the Republic of Congo's annual per capita GDP growth from 2001 to 2006. If the country's infrastructure were improved to the level seen in Mauritius, the regional leader, it could contribute more than 3 percentage points to annual per capita growth. The Republic of Congo's existing infrastructure is concentrated in the developed south, reflecting the country's urbanization patterns. Links spread from there to the less-developed north, where there are vast areas of underexploited dense forest. The Republic of Congo's power sector offers the greatest potential for infrastructure-based economic growth, but major inefficiencies need to be addressed. Transit improvements would also make significant contributions to growth by improving connections to the north and to neighboring countries. Additional opportunities include rehabilitating the fixed-line telephone operator to spread Internet access. The country's water and sanitation infrastructure is in relatively good shape. Spending on infrastructure was $460 million per year in the Republic of Congo during the mid-2000s. Based on these spending levels, if all inefficiencies were eliminated, the country would face an infrastructure funding gap of$270 million a year and would not meet infrastructure targets for 31 years. Spending rose to $550 million per year in 2008-09. If the Republic of Congo could maintain these higher spending levels, the funding gap would essentially disappear. The nation could further reduce the funding gap by adopting lower-cost technologies to meet infrastructure targets.Transport Economics Policy&Planning,Infrastructure Economics,Public Sector Economics,Banks&Banking Reform,Energy Production and Transportation

“Corporate restructuring issues under the holding company structure – The NTT Case in Japan”

ABSTRACT This research paper focused on the corporate restructuring of Nippon Telegraph Telecommunication (NTT Group) under the pure holding company structure in 1999 and its implications. In order to understand the holding company structure, we introduced the concept of "internal capital markets" and explained its application within the framework of NTT Group. Next, we gave an account of the background events leading to NTT Group's corporate restructuring in order to understand the reason for choosing and keeping the holding company structure. Our research methodologies include interviews with NTT Group's management and data from public sources. Finally, to analyze the effect of the holding company structure to NTT Group, we conducted a hypothetical valuation analysis using the free cash flow model. Comparing the market value of NTT Group with our valuation results, it appeared that the market has undervalued NTT Group. We concluded our report with some suggestions on how NTT Group might be able to increase their market value.HOLDING COMPANY STRUCTURE, RESTRUCTURING, INTERNAL CAPITAL MARKET, VALUATION

Sovereign natural disaster insurance for developing countries : a paradigm shift in catastrophe risk financing

Economic theory suggests that countries should ignore uncertainty for public investment and behave as if indifferent to risk because they can pool risks to a much greater extent than private investors can. This paper discusses the general economic theory in the case of developing countries. The analysis identifies several cases where the government's risk-neutral assumption does not hold, thus making rational the use of ex ante risk financing instruments, including sovereign insurance. The paper discusses the optimal level of sovereign insurance. It argues that, because sovereign insurance is usually more expensive than post-disaster financing, it should mainly cover immediate needs, while long-term expenditures should be financed through post-disaster financing (including ex post borrowing and tax increases). In other words, sovereign insurance should not aim at financing the long-term resource gap, but only the short-term liquidity need.Debt Markets,Hazard Risk Management,Banks&Banking Reform,Insurance&Risk Mitigation,Natural Disasters