Loyalty discounts

This paper considers the use of loyalty inducing discounts in vertical supply chains. An upstream manufacturer and a competitive fringe sell differentiated products to a retailer who has private information about the level of stochastic demand. We provide a comparison of market outcomes when the manufacturer uses two-part tariffs (2PT), all-unit quantity discounts (AU), and market share discounts (MS). We show that retailer's risk attitude affects manufacturer's preferences over these three pricing schemes. When the retailer is risk-neutral, it bears all the risk and all three schemes lead to the same outcome. When the retailer is risk-averse, 2PT performs the worst from manufacturer s perspective but it leads to the highest total surplus. For a wide range of parameter values (but not for all) the manufacturer prefers MS to AU. By limiting the retailer's product substitution possibilities MS makes the demand for manufacturer s product more inelastic. This reduces the amount (share of total profits) the manufacturer needs to leave to the retailer for the latter to participate in the scheme.This study is funded from the Valencian Economic Research Institute (IVIE) and the European Commission

Recovery Risk in Stock Returns

In this paper we argue that book-to-market and size attributes represent sensitivities of firm returns to several risk factors, and in so doing they subsume the information in other attributes. Although this gives them high cross-sectional explanatory power, they are not very indicative if we are concerned with testing whether an individual risk factor is priced. In that regard, claiming that financial distress is not priced, by only considering probability of bankruptcy, seems premature. Rational investors may also care about recovery rates and the relatively higher mean returns observed for small firms with very low book-to-market ratios is consistent with this view. To analyse recovery risk, we construct mimicking portfolios by sorting stocks on less noisy attributes such as fixed-assets and intangible-assets ratios. We find that recovery risk mimicking portfolios exhibit typical risk factor characteristics, and perform well in explaining the cross-section of returns. The results suggest that recovery risk factor is a good candidate to be priced, and much of the explanatory power of the size attribute comes from the fact that it embodies useful information regarding recovery risk. Overall, our findings have important portfolio management implications.

Precession of the Isolated Neutron Star PSR B1828-11

Stairs, Lyne & Shemar have found that arrival time residuals from PSR B1828-11 vary periodically with a period of 500 days. This behavior can be accounted for by precession of the radiopulsar, an interpretation that is reinforced by the detection of variations in its pulse profile on the same timescale. Here, we model the period residuals from PSR B1828-11 in terms of precession of a triaxial rigid body. We include two contributions to the residuals: (i) the geometric effect, which arises because the times at which the pulsar emission beam points toward the observer varies with precession phase; (ii) the spindown contribution, which arises from any dependence of the spindown torque acting on the pulsar on the angle between its spin and magnetic axes. We use the data to probe numerous properties of the pulsar, most notably its shape, and the dependence of its spindown torque on the angle between its spin and magnetic axes, for which we assume a sum of a spin-aligned component (with a weight 1-a) and a dipolar component perpendicular to the magnetic beam axis (weight a), rather than the vacuum dipole torque (a=1). We find that a variety of shapes are consistent with the residuals, with a slight statistical preference for a prolate star. Moreover, a range of torque possibilities fit the data equally well, with no strong preference for the vacuum model. In the case of a prolate star we find evidence for an angle-dependent spindown torque. Our results show that the combination of geometrical and spin-down effects associated with precession can account for the principal features of PSR B1828-11's timing behavior, without fine tuning of the parameters.Comment: 22 pages, 14 figures, submitted to MNRAS; added references, corrected typo

Exploiting Full-duplex Receivers for Achieving Secret Communications in Multiuser MISO Networks

We consider a broadcast channel, in which a multi-antenna transmitter (Alice) sends $K$ confidential information signals to $K$ legitimate users (Bobs) in the presence of $L$ eavesdroppers (Eves). Alice uses MIMO precoding to generate the information signals along with her own (Tx-based) friendly jamming. Interference at each Bob is removed by MIMO zero-forcing. This, however, leaves a "vulnerability region" around each Bob, which can be exploited by a nearby Eve. We address this problem by augmenting Tx-based friendly jamming (TxFJ) with Rx-based friendly jamming (RxFJ), generated by each Bob. Specifically, each Bob uses self-interference suppression (SIS) to transmit a friendly jamming signal while simultaneously receiving an information signal over the same channel. We minimize the powers allocated to the information, TxFJ, and RxFJ signals under given guarantees on the individual secrecy rate for each Bob. The problem is solved for the cases when the eavesdropper's channel state information is known/unknown. Simulations show the effectiveness of the proposed solution. Furthermore, we discuss how to schedule transmissions when the rate requirements need to be satisfied on average rather than instantaneously. Under special cases, a scheduling algorithm that serves only the strongest receivers is shown to outperform the one that schedules all receivers.Comment: IEEE Transactions on Communication

Cloud Benchmarking for Performance

How can applications be deployed on the cloud to achieve maximum performance? This question has become significant and challenging with the availability of a wide variety of Virtual Machines (VMs) with different performance capabilities in the cloud. The above question is addressed by proposing a six step benchmarking methodology in which a user provides a set of four weights that indicate how important each of the following groups: memory, processor, computation and storage are to the application that needs to be executed on the cloud. The weights along with cloud benchmarking data are used to generate a ranking of VMs that can maximise performance of the application. The rankings are validated through an empirical analysis using two case study applications; the first is a financial risk application and the second is a molecular dynamics simulation, which are both representative of workloads that can benefit from execution on the cloud. Both case studies validate the feasibility of the methodology and highlight that maximum performance can be achieved on the cloud by selecting the top ranked VMs produced by the methodology.Comment: 6 pages, 6th IEEE International Conference on Cloud Computing Technology and Science (IEEE CloudCom) 2014, Singapor

Extensible Automated Constraint Modelling

In constraint solving, a critical bottleneck is the formulationof an effective constraint model of a given problem. The CONJURE system described in this paper, a substantial step forward over prototype versions of CONJURE previously reported, makes a valuable contribution to the automation of constraint modelling by automatically producing constraint models from their specifications in the abstract constraint specification language ESSENCE. A set of rules is used to refine an abstract specification into a concrete constraint model. We demonstrate that this set of rules is readily extensible to increase the space of possible constraint models CONJURE can produce. Our empirical results confirm that CONJURE can reproduce successfully the kernels of the constraint models of 32 benchmark problems found in the literature

Influence of porosity on fatigue of additive manufactured titanium alloy Ti-6Al-4V

Process-induced defects have been identified as one of the principal failure sources in metal additive manufacturing (AM) under cyclic loading; yet, understanding how they impact fatigue behaviour, such as S-N curves, fatigue crack growth rates remains open. In this work, the high-cycle fatigue behaviour under constant amplitude, axial loading was studied for an AM titanium alloy Ti-6Al-4V that fails from sub-mm size, porosity type defects. More specifically, the dispersion of fatigue life due to porosity and the propagation behaviour of cracks initiated from pores were investigated.Two different AM processes, namely wire+arc additive manufacturing and laser powder-bed fusion, were used to manufacture titanium alloy Ti-6Al-4V used in this work. A trade-off was made by working with process-induced defects, e.g. defect morphologies were representative of real case scenarios, but the dimensions of defects were uncontrolled. A targeted experimental programme was developed to concentrate on the influence of defects by circumventing other parameters that might impact the fatigue life such as the surface roughness, build direction and more. Size and spatial distribution of process-induced defects were measured using a laboratory scale X-ray Computed Tomography prior to fatigue testing. Load-controlled fatigue testing was conducted by repeating tests at the selected stress levels in order to obtain statistically significant data. Furthermore, fatigue crack growth rates were measured for cracks initiating directly from surface pores using the replica technique. After each fatigue test, the crack initiating pore size was quantified by analysing the fracture surface using a scanning electron microscope. The experimental results were analysed both from a linear elastic fracture mechanics perspective and a total life perspective using the local elastic stresses in the vicinity of a pore. Key findings are summarised below.A popular approach to evaluate defect criticality is assuming a volumetric defect as a planar crack by projecting its area to the plane perpendicular to the applied load direction. This planar crack is then assessed using a Kitagawa-Takahashi diagram or similar since cracks at the sub-mm scale could grow below the threshold value of stress intensity factor range (∆Kth). It was found that the analogy of assuming pores as cracks was lost after a certain transition size and fatigue life reduction saturated despite the increase of crack initiating pore diameter roughly by a factor of four.Total fatigue life of AM Ti-6Al-4V could vary up to three orders of magnitude for nominally similar test specimens, as seen in the exploratory literature studies. Defects are considered as one of the causes of this scatter and in this work, defect location, e.g. embeddedor surface, was found to be the dominant factor rather than the defect size. In fact, within a same defect category, such as the surface pores, the scatter of fatigue life due to the variation in crack initiating defect size was less than a conventional manufactured Ti-6Al-4V, where the scatter assumed to be related to the distribution of unfavourably oriented surface grains.Individual fatigue life stages were also investigated by following surface cracks initiated from pores using the replica technique. First detected cracks were less than 50 µm length and occupied roughly 50% of the total fatigue life. This suggests that the crack initiation stage was significant and it should be accounted in fatigue life prediction approaches, noting that the measurements were limited to surface observations. During the crack propagation stage, small cracks could grow faster than the long crack growth measurements at the same nominal ∆K value, i.e. the so-called small crack behaviour. Such a behaviour was observed near the threshold region, however, it was less significant compared to conventional manufactured counterparts. Finally, a similitude to long crack growth rates was achieved,when the measured crack size added to the crack initiating pore size.<br/