Optimal penalty for investment delay in public procurement contracts

Our aim in this paper is to provide a general framework in which to determine the optimal penalty fee inducing the contractor to respect the contracted delivery date in public procurement contracts (PPCs). We do this by developing a real option model that enables us to investigate the contractor's value of investment timing flexibility which the penalty rule - de facto - introduces. We then apply this setting in order to evaluate the range of penalty fees in the Italian legislation on PPCs: according to our calibration analysis, there is no evidence that the substantial delays recorded in the execution times of Italian investments are to be due to incorrectly set penalty fees. This result opens the way for other explanations of delays in PPCs: we thus extend our model to include the probability that the penalty is ineffectively enforced and study how calibration results are accordingly affected. We finally show how our model can be used to investigate both the case of a penalty/premium rule and the one of an optimal penalty fee in a concession contract.public procurement contracts, penalty fee, investment timing flexibility, investment irreversibility, contract incompleteness, enforceability of rules.

Statistical characterization of spatio-temporal sediment dynamics in the Venice lagoon

Characterizing the dynamics of suspended sediment is crucial when investigating the long-term evolution of tidal landscapes. Here we apply a widely tested mathematical model which describes the dynamics of cohesive and noncohesive sediments, driven by the combined effect of tidal currents and wind waves, using 1 year long time series of observed water levels and wind data from the Venice lagoon. The spatiotemporal evolution of the computed suspended sediment concentration (SSC) is analyzed on the basis of the \u201cpeak over threshold\u201d theory. Our analysis suggests that events characterized by high SSC can be modeled as a marked Poisson process over most of the lagoon. The interarrival time between two consecutive over threshold events, the intensity of peak excesses, and the duration are found to be exponentially distributed random variables over most of tidal flats. Our study suggests that intensity and duration of over threshold events are temporally correlated, while almost no correlation exists between interarrival times and both durations and intensities. The benthic vegetation colonizing the central southern part of the Venice lagoon is found to exert a crucial role on sediment dynamics: vegetation locally decreases the frequency of significant resuspension events by affecting patiotemporal patterns of SSCs also in adjacent areas. Spatial patterns of the mean interarrival of over threshold SSC events are found to be less heterogeneous than the corresponding patterns of mean interarrivals of over threshold bottom shear stress events because of the role of advection/dispersion processes in mixing suspended sediments within the lagoon. Implications for long-term morphodynamic modeling of tidal environments are discussed

MULTICRITERIA PRIORITIZATION OF POLICY INSTRUMENTS IN BUILDINGS ENERGY RETROFIT

Improvement of energy-efficiency in residential buildings is a crucial issue in Italy, where 55% of the building stock is older than 40 years and real estate assets are responsible for 33% of primary energy consumption. Consequently, the Italian residential sector offers considerable potential for reducing energy use and GHG emissions, particularly through energy-efficient renovations. Governments can introduce a wide range of policy instruments to encourage households in undertaking energy-efficient renovations: direct financial investments, regulatory instruments (e.g., performance and technology standards), economic and market-based instruments, support information and voluntary actions. Since 2006, the Italian Government has introduced fiscal incentive programs to enhance energy efficiency in residential buildings. During the period 1998-2016 the cost for the Italian Government to due to fiscal incentives (i.e. tax deductions) was extremely high compared to tax revenues. Thus incentives turned out to be excessively costly and not cost-effective. The design and implementation of incentive policies to buildings energy retrofit is a complex process involving a great number of decision variables and actors. Cost-effective incentive policies should prove capacity in stimulating investments, reducing social and environmental costs and promoting innovation. This complexity is exacerbated in the presence of stringent public budget constraints and lack of financial resources. In order to favor the implementation of cost-effective retrofit strategies, the policy maker must take into consideration along with buildings age and construction materials, social costs and benefits, EU and national targets, and environmental concerns. In this context, where multiple objectives need to be pursued, multiple criteria approaches provide a methodological framework to address the complexity of economic, physical, social, cultural and environmental factors which characterize incentive policies. In this paper we propose a multi-criteria decision model to support the policy maker in ranking sustainable incentive policies. In detail, we provide an AHP model for multiple-criteria prioritization of policy instruments to foster investments in energy retrofit of existing buildings

Urban quality in the city of the future: A bibliometric multicriteria assessment model

Abstract Assessing the quality of urban areas is considered as a difficult task. The main reason lies in the multidisciplinary nature of the field, and in the complexity of components that must be accounted for. This study aims to identify the most discussed topics in literature by weighing the main themes currently under investigation and defining their potential interdependencies. We provide a theoretical and conceptual framework to analyze contributions in literature on urban quality assessment in the city of the future by combining a bibliographic analysis and a multi-criteria approach. In detail, we reviewed literature and implemented a methodological approach, which combines a bibliometric analysis and the Analytic Hierarchy Process (AHP). According to the principal keywords "urban quality assessment" and "future city", we initially identified in SCOPUS database 1024 articles and a selection of most cited sub-keywords. Then we fine-tuned the research according to a sequential approach. We performed a statistical analysis on preliminary results and implemented a relative AHP model to obtain a priority ranking of the most relevant sub-keywords. This approach allows for analyzing articles, by combining multiple keywords with the identification of the degree of relationship among the different sub-keywords with respect to the main topic

Buildings energy retrofit valuation approaches: state of the art and future perspectives

The European Directives 2010/31/EU and 2012/27/EU identified the buiding sector as a key sector to achieve the 20-20-20 targets (and those set for 2030 and 2050) and identified existing buildings energy retrofit as a fundamental driver to promote development and create opportunities for employment in this sector which is still affected by a severe economic crisis. Buildings energy retrofit is a complex process involving a great number of decision variables and issues related not only to technical and technological aspects, but also to environmental, social and cultural aspects. This topic is widely debated in literature. There are several contributions on energy consumption modeling and evaluation as well as many authors addressed the impacts of retrofit strategies on CO2 emission reduction. There exists also a conspicuous strand of literature on the methodologies to evaluate different retrofit strategies according to their economic, environmental and social effects (e.g., multi-criteria analysis, life cycle costing and assessment, econometric models, etc.). Nonetheless, there is a lack of contributions that provide a systematic literature review and a classification of most relevant papers on the most innovative and multidisciplinary valuation approaches. This paper presents a systematic literature review, and aims to define the state of the art on valuation approaches of existing buildings energy retrofit. According to a dynamic systematic review protocol, we identified the most relevant contributions and we provide a synoptic table, which summarizes methodological and descriptive aspects and allows for identifying potential gaps in the literature and future developments

Field migration rates of tidal meanders recapitulate fluvial morphodynamics

The majority of tidal channels display marked meandering features. Despite their importance in oil-reservoir formation and tidal landscape morphology, questions remain on whether tidalmeander dynamics could be understood in terms of fluvial processes and theory. Key differences suggest otherwise, like the periodic reversal of landscape-forming tidal flows and the widely accepted empirical notion that tidal meanders are stable landscape features, in stark contrast with their migrating fluvial counterparts. On the contrary, here we show that, once properly normalized, observed migration rates of tidal and fluvial meanders are remarkably similar. Key to normalization is the role of tidal channel width that responds to the strong spatial gradients of landscape-forming flow rates and tidal prisms. We find that migration dynamics of tidal meanders agree with nonlinear theories for river meander evolution. Our results challenge the conventional view of tidal channels as stable landscape features and suggest that meandering tidal channels recapitulate many fluvial counterparts owing to large gradients of tidal prisms across meander wavelengths

Landfills Sizing in Metropolitan Areas

Abstract Waste managers have often to decide whether to undertake an irreversible one-shot capital outlay and invest in a potentially over-sized facility or to proceed with sequential investments to adapt to changes and reduce potential losses. In this paper, we determine the value of managerial flexibility to decide the capacity sizing of a landfill according to the Real Option Approach. We model the investment decision as the exercise of a compound option, where an earlier investment cost represents the exercise price required to acquire the subsequent option to continue operating the project until the next stage comes due