Rail infrastructure charges in Europe

This paper reviews results of a survey of rail infrastructure charges in Europe, presenting evidence on the structure and level of charges across 23 countries, and on the rationale behind the charges. A wide variety of both structure and level of charges is found, and it appears there is a range of explanations for this, including differences in the nature and mix of rail traffic, differences in the willingness and ability of governments to provide subsidies, and continued lack of consensus on the measurement of the marginal cost of infrastructure use. Recommendations on a sensible structure for rail infrastructure charges are given, although the need for further research is also acknowledged. The diversity of approach poses problems particularly for international rail freight, and there is a strong argument for the development of a specific set of international rail freight tariffs

On Optimal Service Differentiation in Congested Network Markets

As Internet applications have become more diverse in recent years, users having heavy demand for online video services are more willing to pay higher prices for better services than light users that mainly use e-mails and instant messages. This encourages the Internet Service Providers (ISPs) to explore service differentiations so as to optimize their profits and allocation of network resources. Much prior work has focused on the viability of network service differentiation by comparing with the case of a single-class service. However, the optimal service differentiation for an ISP subject to resource constraints has remained unsolved. In this work, we establish an optimal control framework to derive the analytical solution to an ISP's optimal service differentiation, i.e. the optimal service qualities and associated prices. By analyzing the structures of the solution, we reveal how an ISP should adjust the service qualities and prices in order to meet varying capacity constraints and users' characteristics. We also obtain the conditions under which ISPs have strong incentives to implement service differentiation and whether regulators should encourage such practices

SLA-Oriented Resource Provisioning for Cloud Computing: Challenges, Architecture, and Solutions

Cloud computing systems promise to offer subscription-oriented, enterprise-quality computing services to users worldwide. With the increased demand for delivering services to a large number of users, they need to offer differentiated services to users and meet their quality expectations. Existing resource management systems in data centers are yet to support Service Level Agreement (SLA)-oriented resource allocation, and thus need to be enhanced to realize cloud computing and utility computing. In addition, no work has been done to collectively incorporate customer-driven service management, computational risk management, and autonomic resource management into a market-based resource management system to target the rapidly changing enterprise requirements of Cloud computing. This paper presents vision, challenges, and architectural elements of SLA-oriented resource management. The proposed architecture supports integration of marketbased provisioning policies and virtualisation technologies for flexible allocation of resources to applications. The performance results obtained from our working prototype system shows the feasibility and effectiveness of SLA-based resource provisioning in Clouds.Comment: 10 pages, 7 figures, Conference Keynote Paper: 2011 IEEE International Conference on Cloud and Service Computing (CSC 2011, IEEE Press, USA), Hong Kong, China, December 12-14, 201

The effects of qos level degradation cost on provider selection and task allocation model in telecommunication networks

Firms acquire network capacity from multiple suppliers which offer different Quality of Service (QoS) levels. After acquisition, day-to-day operations such as video conferencing, voice over IP and data applications are allocated between these acquired capacities by considering QoS requirement of each operation. In optimal allocation scheme, it is generally assumed each operation has to be placed into resource that provides equal or higher QoS Level. Conversely, in this study it is showed that former allocation strategy may lead to suboptimal solutions depending upon penalty cost policy to charge degradation in QoS requirements. We model a cost minimization problem which includes three cost components namely capacity acquisition, opportunity and penalty due to loss in QoS

The use of cost accounting methodologies to determine prices in German health care

In many sectors of the health care system, prices at which providers are reimbursed by payers are not determined by the market mechanism, but rather by a defined administrative process. Depending on the sector, prices are set politically and are negotiated between different actors or are calculated according to a defined procedure, considering cost data from a sample of providers. The selected approach for price setting determines decisively, to which extent prices for certain services reflect the actual costs incurred for these services. A lack of reflection of actual costs can lead to unintended incentives for providers and therefore have implications on the allocative efficiency. Our analysis shows that in Germanys inpatient and outpatient sector, cost data is increasingly considered for price setting while in other sectors such as long-term care and rehabilitation, the use of cost data is still very limited. However, DRG-cost-weights in the inpatient sector insufficiently reflect actual costs incurred. Thus, decision makers in the German health care system rely more on cost data for price setting and improving the accuracy of cost calculations in order to increase allocative efficiency. -- Die Preisbildung für die Erstattung von Leistungserbringern erfolgt in vielen Sektoren des Gesundheitswesens nicht durch den Marktmechanismus, sondern durch einen administrativ definierten Prozess. Je nach Sektor werden politische Preise vorgegeben, unter den Akteuren verhandelt oder nach einem festgelegten Verfahren, unter Berücksichtigung von Kostendaten aus einer Stichprobe von Leistungserbringern, berechnet. Das gewählte Verfahren der Preisbildung determiniert in entscheidendem Maße, inwieweit die Preise für die erbrachten Leistungen die realen Kosten der Leistungserbringer für diese abbilden. Eine mangelnde Reflektion der Kosten in den Preisen kann zu Fehlanreizen für die Leistungserbringer und mithin zu einer Fehlallokation von Ressourcen führen. Im Rahmen dieser Untersuchung zeigt sich, dass in Deutschland im stationären und ambulanten Bereich zunehmend detaillierte Kostendaten für die Preisberechnung herangezogen werden, während dies in anderen Sektoren wie Pflege und Rehabilitation bislang nur sehr bedingt erfolgt. Es zeigt sich jedoch, dass auch im stationären Sektor die DRG-Relativgewichte bislang nur unzureichend die Kosten für die entsprechenden Leistungen abbilden. Insgesamt muss in Deutschland für die Preisbildung im Gesundheitswesen mehr auf Kosteninformationen für die Preisberechnung zurückgegriffen und die Verursachungsgerechtigkeit der Kostenkalkulationen verbessert werden, um die Allokationseffizienz zu erhöhen.

Inverting the regulatory rules? Optimizing airport regulation to account for commercial revenues

This paper analyzes the role of commercial revenues in today's airport regulatory system. We find that the current regulatory regime only partially achieves core aims such as welfare maximization. After highlighting instances in which airport price regulation is not economically justified, we explore the potential for airports to exercise market power in the commercial sector. In certain circumstances, we advocate the introduction of an 'inverted' dual till system under which commercial as opposed to aviation revenues are the focus of price regulation. The suitability of such a system varies from airport to airport, however, depending on various factors, such as the airport's competitive environment and the presence of capacity constraints. --Airport regulation,non-aviation revenues,price differentiation,single till,dual till