Locating Discretionary Service Facilities II: Maximizing Market Size, Minimizing Inconvenience

Revised November 1992Discretionary service facilities are providers of products and/or services that are purchased by customers who are traveling on otherwise pre-planned trips such as the daily commute. Optimum location of such facilities requires them to be at or near points in the transportation network having sizable flows of different potential customers. In [1] a first version of this problem was formulated, assuming that customers would make no deviations, no matter how small, from the pre-planned route to visit a discretionary service facility. Here the model is generalized in a number of directions, all sharing the property that the customer may deviate from the pre-planned route to visit a discretionary service facility. Three different generalizations are offered, two of which can be solved approximately by greedy heuristics and the third by any approximate or exact method used to solve the pmedian problem. It is shown for those formulations yielding to a greedy heuristic approximate solution, including the formulation in [1], that the problems are examples of optimizing submodular functions for which the Nemhauser et. al. [51 bound on the performance of a greedy algorithm holds. In particular, the greedy solution is always within 37% of optimal, and for one of the formulations it is proved that the bound is tight

Customer Service Employees and Discretionary Service Behavior: A Psychological Contract Model

We present a theoretical framework for explicating contact employee behavior during customer service encounters, labeled discretionary service behavior (DSB). The model takes an organizational justice perspective, incorporating psychological contracts and fairness perceptions. We define DSB, examine potential antecedents, present research propositions related to the model, and discuss potential organizational outcomes

Merchant Transmission Investment

We examine the performance attributes of a merchant transmission investment framework that relies on �market driven� transmission investment to provide the infrastructure to support competitive wholesale markets for electricity. Under a stringent set of assumptions, the merchant investment model appears to solve the natural monopoly problem and the associated need for regulating transmission companies traditionally associated with electric transmission networks. We expand the model to incorporate imperfection in wholesale electricity markets, lumpiness in transmission investment opportunities, stochastic attributes of transmission networks and associated property rights definition issues, the effects of the behaviour system operators and transmission owners on transmission capacity and reliability, co-ordination and bargaining considerations, forward contract, commitment and asset specificity issues. This significantly undermines the attractive properties of the merchant investment model. Relying primarily on a market driven investment framework to govern investment is likely to lead to inefficient investment decisions and undermine the performance of competitive markets

Merchant Transmission Investment

We examine the performance attributes of a merchant transmission investment framework that relies on market driven' transmission investment to provide the infrastructure to support competitive wholesale markets for electricity. Under a stringent set of assumptions, the merchant investment model has a remarkable set of attributes that appear to solve the natural monopoly problem traditionally associated with electricity transmission networks. We extend the merchant investment model to incorporate imperfections in wholesale electricity markets, lumpiness in transmission investment opportunities, stochastic attributes of transmission networks and associated property rights definition issues, the effects of behavior of transmission owners and system operators on transmission capacity, maintenance and reliability, coordination and bargaining considerations, forward contract, commitment and asset specificity issues. Incorporating these more realistic attributes of transmission networks and the behavior of transmission owners and system operators undermines the attractive properties of the merchant model and leads to inefficient transmission investment decisions.

Benchmarking the Health Sector in Germany – An Application of Data Envelopment Analysis

At present, a first round of hospital benchmarking as required by German law on health care reform takes place. After extensive discussions between hospitals and insurance companies, which are jointly responsible to deliver benchmarking results, a method with some peculiar characteristics was chosen. In this paper it is argued that the deficiencies of said method could be overcome by using Data Envelopment Analysis (DEA). The reasons that make DEA an advisable tool for policy decisions within the context of relative performance evaluation in the health care sector are discussed. In order to illustrate the potential of nonparametric frontier estimation for hospital benchmarking in Germany, a comparison of hospitals, which provide the same basic clinical care, is carried out. Controlling for differences in the case mix and for possible heterogeneity of the services which hospitals provide, substantial productivity differences can be detected. Beyond simply identifying inefficient providers DEA leads to additional insight about the reasons of inefficiency and to useful management implications.Health care reform benchmarking relative performance evaluation Data Envelopment Analysis

Cargo dwell time in Durban : lessons for Sub-Saharan African ports

Based on quantitative and qualitative data, this paper attempts to identify the main reasons why cargo dwell time in Durban port has dramatically reduced in the past decade to a current average of 3-4 days. A major customs reform; changes in port storage tariffs coupled with strict enforcement; massive investments in infrastructure and equipment; and changing customer behavior through contractualization between the port operator and shipping lines or between customs, importers, and brokers have all played a major role. The main lesson for Sub-Saharan Africa that can be drawn from Durban is that cargo dwell time is mainly a function of the characteristics of the private sector, but it is the onus of public sector players, such as customs and the port authority, to put pressure on the private sector to make more efficient use of the port and reduce cargo dwell time.Transport Economics Policy&Planning,Transport and Trade Logistics,Common Carriers Industry,Ports&Waterways,Airports and Air Services

Supporting public availability and accessibility with Elvin: experiences and reflections.

We provide a retrospective account of how a generic event notification service called Elvin and a suite of simple client applications: CoffeeBiff, Tickertape and Tickerchat, came to be used within our organisation to support awareness and interaction. After overviewing Elvin and its clients, we outline various experiences from data collated across two studies where Elvin and its clients have been used to augment the workaday world to support interaction, to make digital actions visible, to make physical actions available beyond the location of action, and to support content and socially based information filtering. We suggest there are both functional and technical reasons for why Elvin works for enabling awareness and interaction. Functionally, it provides a way to produce, gather and redistribute information from everyday activities (via Elvin) and to give that information a perceptible form (via the various clients) that can be publicly available and accessible as a resource for awareness. The integration of lightweight chat facilities with these information sources enables awareness to easily flow into interaction, starting to re-connect bodies to actions, and starting to approximate the easy flow of interaction that happens when we are co-located. Technically, the conceptual simplicity of the Elvin notification, the wide availability of its APIs, and the generic functionality of its clients, especially Tickertape, have made the use of the service appealing to developers and users for a wide range of uses

Are cost models useful for telecoms regulators in developing countries?

Worldwide privatization of the telecommunications industry, and the introduction of competition in the sector, together with the ever-increasing rate of technological advance in telecommunications, raise new and critical challenges for regulation. Fo matters of pricing, universal service obligations, and the like, one question to be answered is this: What is the efficient cost of providing the service to a certain area or type of customer? As developing countries build up their capacity to regulate their privatized infrastructure monopolies, cost models are likely to prove increasingly important in answering this question. Cost models deliver a number of benefits to a regulator willing to apply them, but they also ask for something in advance: information. Without information, the question cannot be answered. The authors introduce cost models and establish their applicability when different degrees of information are available to the regulator. They do no by running a cost model with different sets of actual data form Argentina's second largest city, and comparing results. Reliable, detailed information is generally scarce in developing countries. The authors establish the minimum information requirements for a regulator implementing a cost proxy model approach, showing that this data constraint need not be that binding.ICT Policy and Strategies,Decentralization,Environmental Economics&Policies,Economic Theory&Research,Business Environment,ICT Policy and Strategies,Environmental Economics&Policies,Geographical Information Systems,Economic Theory&Research,Educational Technology and Distance Education

Free entry in infrastructure

With a policy of free entry, individuals, firms, or community groups who wish to supply power, water, and sanitation services can do so with minimal legal restrictions. Free entry is the opposite of"exclusivity"or"legal monopoly". Free entry is allowed in most industries, but governments usually allow only one provider of power, water, and sanitation in any given area. This is supposed to prevent wasteful duplication and ensure a supply of essential services to poor and marginal areas. But monopoly water and power utilities often operate at high cost, lack funds to invest, and provide low-quality, unreliable service. Worse, poor and marginal areas are often unserved. When the monopoly model doesn't work, it is time to look at alternatives. The authors provide examples of alternative solutions in developing countries: *In Karachi, Pakistan, the Orangi Pilot Project provides sanitation in an unplanned settlement. Roughly 800,000 working class people lived in an area where sanitary conditions were medievaland a long-hoped-for sewerage system never came. Starting in 1980, a charitable group developed a low-cost approach to piped sanitation, explained the technology to the community, and catalyzed community action. Householders and neighborhoods funded the construction of household pourflush latrines and sewerage lines. * In Paraguay, 300 to 400 private individuals and aguateros supply good quality piped water to areas unserved by the public water company. Unlike the public company, the aguateros allow payment of connection fees on installment, making it easier for low-income consumers to connect. * In Yemen, small-scale electricity providers innovatively meet the rural and village demand for electricity that the public utility does not meet. These entrants seldom duplicate investments, although some government intervention to ensure interconnection could improve efficiency. Limitations on entry may sometimes be justified for environmental reasons or to promote private sector investment, but those cases are rare. Legalizing alternative providers will allow them to expand and meet new needs. Limits on their entry may be needed sometimes, but limits should be the exception, not the rule, the authors argue. Generally, free entry should be allowed in power, water, and sanitation.Health Economics&Finance,Decentralization,Water and Industry,Economic Theory&Research,Environmental Economics&Policies,Town Water Supply and Sanitation,Environmental Economics&Policies,Health Economics&Finance,Water and Industry,Economic Theory&Research