Real Options using Markov Chains: an application to Production Capacity Decisions

In this work we address investment decisions using real options. A standard numerical approach for valuing real options is dynamic programming. The basic idea is to establish a discrete-valued lattice of possible future values of the underlying stochastic variable (demand in our case). For most approaches in the literature, the stochastic variable is assumed normally distributed and then approximated by a binomial distribution, resulting in a binomial lattice. In this work, we investigate the use of a sparse Markov chain to model such variable. The Markov approach is expected to perform better since it does not assume any type of distribution for the demand variation, the probability of a variation on the demand value is dependent on the current demand value and thus, no longer constant, and it generalizes the binomial lattice since the latter can be modelled as a Markov chain. We developed a stochastic dynamic programming model that has been implemented both on binomial and Markov models. A numerical example of a production capacity choice problem has been solved and the results obtained show that the investment decisions are different and, as expected the Markov chain approach leads to a better investment policy.Flexible Capacity Investments, Real Options, Markov Chains, Dynamic Programming

Técnicas para melhorar a durabilidade da construção em terra

Umas das principais fragilidades da construção em terra é a sua durabilidade face à ação da água, seja pelas chuvas, inundações ou ascensão da água por capilaridade, situações que acontecem sobretudo em países com elevado índice de pluviosidade. Contudo, as construções vernaculares têm demonstrado que é possível construir de forma durável, apesar de este conhecimento parecer ter sido esquecido ao longo dos anos. Por outro lado também têm sido desenvolvidas novas tecnologias para compactação, estabilização e impermeabilização de solos para melhorar a durabilidade da construção em terra. Todavia, a sustentabilidade da solução construtiva pode ser comprometida pelo uso excessivo de cimento ou materiais excessivamente impermeabilizantes. Neste artigo, pretende-se identificar e avaliar estratégias para proteção face à ação da água que têm sido utilizadas desde a Antiguidade até aos nossos dias. Deste modo, será possível perceber como inúmeros edifícios construídos em terra foram preservados ao longo de séculos, resistindo a condições climáticas severas

Corruption and political institutions in Portugal: an exploratory analysis

Corruption, political cover-ups, and fraud in a general form have become a matter of political debate in the last few years in Portugal. It is not that corrupt politicians and government officials were not around before the 21st century and are only now abusing their public authority, but is it only now coming out in public and in a big way. After thirty years of democracy, Portuguese public misuse of power is apparently no longer tolerated for government officials suspected of fraud and corruption now are being formally charged. The literature on corruption and democracy indicate that this is a positive sign of progress in the democratic development of sound political institutions. Empirical studies are few and recent, but they generally tend to point to a negative effect of corruption on attitudes toward government. In Portugal, however, despite public knowledge of alleged events, citizens do not seem to assign any blame. In fact, perceptions of corruption and fraud do not always seem to affect citizens’ ropensity to trust in political institutions. Using surveys conducted by the Eurobarometer in Portugal, we explore the relationship between corruption and fraud and political trust in different political institutions. We find that this relationship varies depending upon the institution. Citizens with a greater perception and concern for corruption and fraud in general express lower levels of trust in government and in the justice system. Results also show that this relationship does not hold in the case of the parliament, political parties, and the police.Fundação para a Ciência e a Tecnologia (FCT

Sobre o valor relevante das demonstrações financeiras separadas

A promulgação do Regulamento n.º 1606/2002 obrigou a que as entidades com títulos admitidos à cotação em Bolsa, na União Europeia, preparassem as suas demonstrações financeiras consolidadas de acordo com as International Financial Reporting Standards (IFRS) endossadas, mas concede a cada Estado Membro (EM) a escolha sobre o normativo a utilizar na preparação das demonstrações financeiras separadas. Dada a diversidade pelo facto de os Estados Membros poderem obrigar, permitir, ou proibir a aplicação das IFRS na preparação das demonstrações financeiras separadas das entidades que consolidam, este estudo tem como objetivo perceber se as DF separadas são relevantes, e se essa relevância é condicionada pela proibição ou obrigação do uso das IFRS na sua preparação. Este estudo inclui informação de entidades com títulos admitidos à cotação em bolsa em 17 países da EU nos quais a utilização das IFRS é exigida numas jurisdições e proibida em outras. Os resultados sugerem que as demonstrações financeiras separadas são relevantes para explicar o valor de mercado de uma entidade, e que a proibição do uso das IFRS na preparação dessas DF separadas mitiga o valor relevante do seu capital próprio e dos resultados líquidos, ainda que apenas no caso do capital próprio essa atenuação seja estatisticamente significativa.info:eu-repo/semantics/publishedVersio

Do citizens trust the civil service differently? Comparing the determinants of confidence in political-administrative institutions

This paper asks whether citizens judge public administration to be trustworthy using different criteria from other political institutions. Using survey data, we estimate ordered logistic and multivariate regressions to compare the determinants of trust in six different political-administrative institutions. Findings show that social trust, political interest, as well as other individual characteristics, have very similar effects on trust regardless of the institution. The evidence shows that people who are older and more educated, interested in politics, and employed in the public sector, are only slightly more likely to make some sort of distinction. Implications for non-discriminant judgement mechanisms are discussed.This study was conducted at Research Center in Political Science [UID/CPO/0758/2019], University of Minho, and was supported by the Portuguese Foundation for Science and Technology and the Portuguese Ministry of Education and Science through national funds

Exploring coalition behaviour in the allocation of Portuguese local government portfolios

The objective of this paper is to begin to explore coalition behaviour in Portuguese local government. Electoral rules exclude formal post-electoral coalition formation here. Given this, why study coalition behaviour in Portuguese local government? We argue that there is a coalition-like type of bargaining in the form of delegation, i.e., the distribution of portfolios to some but not all members of councils. This makes Portuguese local governments attractive sites for study. In the paper, we first describe the institutional structure and rules of the game at the local government level. Second, using descriptive evidence on recent local election data, we look at how parties behave post-electorally and discuss how this behaviour in light of the portfolio allocation and coalition bargaining literature.Fundação para a Ciência e a Tecnologia (FCT

Study and characterization of heat modified wood portuguese species

A modificação térmica tem-se revelado um método eficaz na melhoria da durabilidade de elementos de madeira. Até ao momento, as aplicações da madeira termicamente modificada (MTM) têm sido limitadas a revestimentos já que o tratamento térmico de tratamento conduz a uma redução significativa das resistências mecânicas da madeira. Contudo, este tratamento térmico poderá valorizar e potenciar a utilização de espécies de madeira menos utilizadas na construção, como são o Eucalipto e o Pinho bravo nacional. Com o objetivo de avaliar o efeito do tratamento térmico nas espécies referidas e, complementarmente, na madeira de Faia e Freixo, realizou-se uma campanha experimental composta por ensaios de caracterização mecânica (compressão paralela às fibras e flexão) e de estabilidade dimensional (retração, inchamento e teor de água de equilíbrio (TAE)). Para efeitos de comparação, todos os ensaios envolveram séries de provetes de cada espécie de madeira natural e MTM. Os resultados obtidos são coerentes com a bibliografia disponível, o aumento da estabilidade dimensional, assim como a diminuição do TAE e das propriedades mecânicas de flexão foram verificadas, permitindo, assim, avaliar a influência da modificação térmica nas propriedades de espécies de madeira presentes em Portugal.The thermal modification has proved to be an effective method to improve the durability of wood elements. Until the moment, applications of thermally modified wood (MTM) have been limited to non-structural applications, because the heat treatment leads to a significant reduction in the mechanical performance of wood. However, this heat treatment can promote the use of less used wood species in construction, as the national Eucalyptus and Pine. In order to evaluate the effect of heat treatment on the species of Pine, Eucalyptus, Beech and Ash, was held an experimental program that consisted in mechanical characterization tests (compression parallel to grain and flexion) and tests of dimensional stability (shrinkage, swelling and equilibrium moisture content (EMC)). For comparison, all tests were made with samples of non-modified and thermally modified wood. The results are consistent with the available literature, the dimensional stability increased, as well as the reduction of TAE and mechanical properties, allowing the evaluation of the thermal modification on the properties of wood species present in Portugal

Uncertainty estimation and in-house method validation of HPLC analysis of carotenoids for food composition data production

The method for separation and quantitative determination of the main carotenoids in food by high-performance liquid chromatography (HPLC) was in-house validated. Tomato (Lycopersicon esculentum M.) as food matrix was used to demonstrate its linearity, repeatability, intermediate precision, detection and quantification limits, sensitivity and bias. In addition, stability of carotenoids was studied in function of temperature and time. Method accuracy was quantified through measurement uncertainties estimate based on this validation study. Furthermore, a study was conducted to evaluate variability coming from location in an experimental field composed by 12 subfields. The use of two metal free reverse phase columns and an organic mobile phase based on acetonitrile, methanol and dichloromethane enabled the separation of the six target compounds (trans-a-carotene, trans-b-carotene, b-cryptoxanthin, all-lycopene, lutein, zeaxanthin) within a 30 min run; detection at 450 nm and external calibration allowed the quantification of the analytes. Carotenoids concentration and measurement uncertainty, in mg/100 g, in tomato varieties ‘‘lido” and ‘‘for salad” were, respectively, 1.0 ± 0.14 and 0.39 ± 0.056 for trans-b-carotene, 8 ± 2.0 and 2.3 ± 0.57 for all-lycopene and 0.10 ± 0.017 and 0.08 ± 0.015 for lutein; trans-a-carotene, b-cryptoxanthin and zeaxanthin were not detected in both varieties (detection limits, in lg/100 g, 0.81, 0.57 and 0.77, respectively). For b-carotene and lutein, uncertainty associated with the entire process including small-scale within-region variation was statistically different, at a significance level of 5%, from measurement uncertainty (which includes sampling in the laboratory)

Estudo e caracterização de espécies portuguesas de madeira termicamente modificada

A modificação térmica tem-se revelado um método eficaz na melhoria da durabilidade de elementos de madeira. Até ao momento, as aplicações da madeira termicamente modificada (MTM) têm sido limitadas a revestimentos já que o tratamento térmico de tratamento conduz a uma redução significativa das resistências mecânicas da madeira. Contudo, este tratamento térmico poderá valorizar e potenciar a utilização de espécies de madeira menos utilizadas na construção, como são o Eucalipto e o Pinho bravo nacional. Com o objetivo de avaliar o efeito do tratamento térmico nas espécies referidas e, complementarmente, na madeira de Faia e Freixo, realizou-se uma campanha experimental composta por ensaios de caracterização mecânica (compressão paralela às fibras e flexão) e de estabilidade dimensional (retração, inchamento e teor de água de equilíbrio (TAE)). Para efeitos de comparação, todos os ensaios envolveram séries de provetes de cada espécie de madeira natural e MTM. Os resultados obtidos são coerentes com a bibliografia disponível, o aumento da estabilidade dimensional, assim como a diminuição do TAE e das propriedades mecânicas de flexão foram verificadas, permitindo, assim, avaliar a influência da modificação térmica nas propriedades de espécies de madeira presentes em Portugal.The thermal modification has proved to be an effective method to improve the durability of wood elements. Until the moment, applications of thermally modified wood (MTM) have been limited to non-structural applications, because the heat treatment leads to a significant reduction in the mechanical performance of wood. However, this heat treatment can promote the use of less used wood species in construction, as the national Eucalyptus and Pine. In order to evaluate the effect of heat treatment on the species of Pine, Eucalyptus, Beech and Ash, was held an experimental program that consisted in mechanical characterization tests (compression parallel to grain and flexion) and tests of dimensional stability (shrinkage, swelling and equilibrium moisture content (EMC)). For comparison, all tests were made with samples of non-modified and thermally modified wood. The results are consistent with the available literature, the dimensional stability increased, as well as the reduction of TAE and mechanical properties, allowing the evaluation of the thermal modification on the properties of wood species present in Portugal