Simplified Estimation of Economic Seismic Risk for Buildings

A seismic risk assessment is often performed on behalf of a buyer of commercial buildings in seismically active regions. One outcome of the assessment is that a probable maximum loss (PML) is computed. PML is of limited use to real-estate investors as it has no place in a standard financial analysis and reflects too long a planning period. We introduce an alternative to PML called probable frequent loss (PFL), defined as the mean loss resulting from shaking with 10% exceedance probability in 5 years. PFL is approximately related to expected annualized loss (EAL) through a site economic hazard coefficient (H) introduced here. PFL and EAL offer three advantages over PML: (1) meaningful planning period; (2) applicability in financial analysis (making seismic risk a potential market force); and (3) can be estimated using a single linear structural analysis, via a simplified method called linear assembly-based vulnerability (LABV) that is presented in this work. We also present a simple decision-analysis framework for real-estate investments in seismic regions, accounting for risk aversion. We show that market risk overwhelms uncertainty in seismic risk, allowing one to consider only expected consequences in seismic risk. We illustrate using 15 buildings, including a 7-story nonductile reinforced-concrete moment-frame building in Van Nuys, California, and 14 buildings from the CUREE-Caltech Woodframe Project

Processor Willingness to Adopt a Crawfish Peeling Machine: An Application of Technology Adoption under Uncertainty

Crawfish processors’ ex ante adoption rates of three hypothetical crawfish peeling machines are assessed using a polychotomous-choice elicitation format. Adoption rates would likely range from 23% to 70%, depending upon which machine was offered and whether it was purchased or leased. Processors most likely to adopt are determined using ordered probit analysis. Likely adopters would be larger, more diversified processors with greater resources and longer planning horizons.crawfish, ex ante technology adoption, peeling machine, Agribusiness, Farm Management, Food Consumption/Nutrition/Food Safety, Industrial Organization, D81, Q16,

A Tissue Engineering product development pathway

Tissue engineering is a field of inquiry and research that uses engineering techniques and principles of biological sciences to develop functional substitutes for reconstruction of damaged organs. Commercial translation of tissue engineering products is currently in progress all over the world. Many companies are moving their interest towards this market segment that grows by 6% per year. Aim of this thesis is to probe the possibility of developing tissue engineering products in the most cost-effective way, minimizing the industrial risk and developing a specific fund raising model. Tissue engineering is based on three main features: cells, scaffolds and bioreactors. Cells are seeded on a scaffold and cultured in a bioreactor in order to obtain a tissue engineering product. Nevertheless, developing cell carrying products is hampered by certification claims ("advanced therapies" certification rules) that unbearably increase R&D and certification costs and can be faced by either big companies or start-ups of big companies and spin-offs of complex aggregates of research centers involved in advanced cell research. On the other hand, scaffolds (certification class IIb) and bioreactors for tissue engineering (certification class I) can be developed with a lower economic effort, being the competition based on innovation, since their market is in the "growth phase" for scaffolds and in the "introduction phase" for bioreactors in the Levitt's product life cycle theory. Purpose of this thesis is to basically study scaffold and bioreactor features, then to preliminarily design some models of bioreactors and, eventually, to set a business model, based on private and public fund raising, aimed to the development of scaffolds for dental implantology and of bioreactors for cardiovascular and bone tissue engineering. Finally, a business plan of a company being spin-off of Politecnico di Torino and industrial start-up has been elaborate

Flat-plate solar array project. Volume 1: Executive summary

In 1975, the U.S. Government contracted the Jet Propulsion Lab. to develop, by 1985, in conjunction with industry, the photovoltaics (PV) module and array technology required for widespread use of photovoltaics as a significant terrestrial energy source. As a result, a project that eventually became known as the Flat Plate Solar Array (FSA) Project was formed to manage an industry, university, and Government team to perform the necessary research and development. The original goals were to achieve widespread commercial use of PV modules and arrays through the development of technology that would allow them to be profitably sold for $1.07/peak watts (1985 dollars). A 10% module conversion efficiency and a 20 year lifetime were also goals. It is intended that the executive summary provide the means by which one can gain a perspective on 11 years of terrestrial photovoltaic research and development conducted by the FSA Project

Impact of Seismic Risk on Lifetime Property Values

This report presents a methodology for establishing the uncertain net asset value, NAV, of a real-estate investment opportunity considering both market risk and seismic risk for the property. It also presents a decision-making procedure to assist in making real-estate investment choices under conditions of uncertainty and risk-aversion. It is shown that that market risk, as measured by the coefficient of variation of NAV, is at least 0.2 and may exceed 1.0. In a situation of such high uncertainty, where potential gains and losses are large relative to a decision-maker's risk tolerance, it is appropriate to adopt a decision-analysis approach to real-estate investment decision-making. A simple equation for doing so is presented. The decision-analysis approach uses the certainty equivalent, CE, as opposed to NAV as the basis for investment decision-making. That is, when faced with multiple investment alternatives, one should choose the alternative that maximizes CE. It is shown that CE is less than the expected value of NAV by an amount proportional to the variance of NAV and the inverse of the decision-maker's risk tolerance, [rho]. The procedure for establishing NAV and CE is illustrated in parallel demonstrations by CUREE and Kajima research teams. The CUREE demonstration is performed using a real 1960s-era hotel building in Van Nuys, California. The building, a 7-story non-ductile reinforced-concrete moment-frame building, is analyzed using the assembly-based vulnerability (ABV) method, developed in Phase III of the CUREE-Kajima Joint Research Program. The building is analyzed three ways: in its condition prior to the 1994 Northridge Earthquake, with a hypothetical shearwall upgrade, and with earthquake insurance. This is the first application of ABV to a real building, and the first time ABV has incorporated stochastic structural analyses that consider uncertainties in the mass, damping, and force-deformation behavior of the structure, along with uncertainties in ground motion, component damageability, and repair costs. New fragility functions are developed for the reinforced concrete flexural members using published laboratory test data, and new unit repair costs for these components are developed by a professional construction cost estimator. Four investment alternatives are considered: do not buy; buy; buy and retrofit; and buy and insure. It is found that the best alternative for most reasonable values of discount rate, risk tolerance, and market risk is to buy and leave the building as-is. However, risk tolerance and market risk (variability of income) both materially affect the decision. That is, for certain ranges of each parameter, the best investment alternative changes. This indicates that expected-value decision-making is inappropriate for some decision-makers and investment opportunities. It is also found that the majority of the economic seismic risk results from shaking of S[subscript a] < 0.3g, i.e., shaking with return periods on the order of 50 to 100 yr that cause primarily architectural damage, rather than from the strong, rare events of which common probable maximum loss (PML) measurements are indicative. The Kajima demonstration is performed using three Tokyo buildings. A nine-story, steel-reinforced-concrete building built in 1961 is analyzed as two designs: as-is, and with a steel-braced-frame structural upgrade. The third building is 29-story, 1999 steel-frame structure. The three buildings are intended to meet collapse-prevention, life-safety, and operational performance levels, respectively, in shaking with 10%exceedance probability in 50 years. The buildings are assessed using levels 2 and 3 of Kajima's three-level analysis methodology. These are semi-assembly based approaches, which subdivide a building into categories of components, estimate the loss of these component categories for given ground motions, and combine the losses for the entire building. The two methods are used to estimate annualized losses and to create curves that relate loss to exceedance probability. The results are incorporated in the input to a sophisticated program developed by the Kajima Corporation, called Kajima D, which forecasts cash flows for office, retail, and residential projects for purposes of property screening, due diligence, negotiation, financial structuring, and strategic planning. The result is an estimate of NAV for each building. A parametric study of CE for each building is presented, along with a simplified model for calculating CE as a function of mean NAV and coefficient of variation of NAV. The equation agrees with that developed in parallel by the CUREE team. Both the CUREE and Kajima teams collaborated with a number of real-estate investors to understand their seismic risk-management practices, and to formulate and to assess the viability of the proposed decision-making methodologies. Investors were interviewed to elicit their risk-tolerance, r, using scripts developed and presented here in English and Japanese. Results of 10 such interviews are presented, which show that a strong relationship exists between a decision-maker's annual revenue, R, and his or her risk tolerance, [rho is approximately equal to] 0.0075R[superscript 1.34]. The interviews show that earthquake risk is a marginal consideration in current investment practice. Probable maximum loss (PML) is the only earthquake risk parameter these investors consider, and they typically do not use seismic risk at all in their financial analysis of an investment opportunity. For competitive reasons, a public investor interviewed here would not wish to account for seismic risk in his financial analysis unless rating agencies required him to do so or such consideration otherwise became standard practice. However, in cases where seismic risk is high enough to significantly reduce return, a private investor expressed the desire to account for seismic risk via expected annualized loss (EAL) if it were inexpensive to do so, i.e., if the cost of calculating the EAL were not substantially greater than that of PML alone. The study results point to a number of interesting opportunities for future research, namely: improve the market-risk stochastic model, including comparison of actual long-term income with initial income projections; improve the risk-attitude interview; account for uncertainties in repair method and in the relationship between repair cost and loss; relate the damage state of structural elements with points on the force-deformation relationship; examine simpler dynamic analysis as a means to estimate vulnerability; examine the relationship between simplified engineering demand parameters and performance; enhance category-based vulnerability functions by compiling a library of building-specific ones; and work with lenders and real-estate industry analysts to determine the conditions under which seismic risk should be reflected in investors' financial analyses

A modular-based approach for Just-In-Time Specification of customer orders in the aircraft manufacturing industry

The demand for flexibility in the configuration of highly customized capital goods such as aircrafts is rising. Customers request specifying product options later than required by the currently defined order fulfilment process of the OEM. However, late changes of previously configured products can cause disturbances in global production networks. In this paper, a modular-based approach is presented, allowing customers to specify options just-in-time depending on the respective lead times following an Engineer/Order-to-order (EOTO) strategy. The concept of Just-In-Time Specification with its respective phases of order specification and steps of production planning is described and applied to the aircraft manufacturing industry