Real Options: Applications in Public Economics

This paper illustrates the use of real options principles to value prototypical resource and industryinvestment projects. It captures important competitive/strategic dimensions in a step-by-stepanalysis of investment decisions (options) under uncertainty. It compares and contrasts staticdiscounted cash flow analysis (DCF) with real options analysis using three case studies. The initialexample values a resource extraction process using static DCF and then compares the projectvaluation when future information is valued and acted upon. The second example considers a coaldevelopment and uses the binomial valuation approach to capture the option value associated withhaving the right but not the obligation to exit the development. It contrasts this valuation approachagainst static DCF and highlights that future royalty payments could be underestimated if based onthe standard DCF valuation. The third example analyses the impact of providing a subsidy forhybrid vehicle production to accelerate potential uncertain environmental benefits. Lastly, thesuitability of the standard financial and economic evaluation tools used by treasury agencies isconsidered when projects contain real options.financial economics; investment decisions; public economics; externalities; subsidies; project evaluation

Advertising Research Issues from FTC Versus Stouffer Foods Corporation

Extrinsic evidence is frequently offered in Federal Trade Commission advertising deception cases, most often in the form of advertising research, such as copy tests. Although generally accepted principles exist for copy test evidence presented before the Commission, how these principles are operationalized can provide fertile ground for challenges. Thus, the authors review six copy testing and ad interpretation issues from the recent Stouffer Foods case. The authors discuss difficult tradeoffs inherent in relative versus absolute claims, multiple claims, control ad groups, control questions, and disclosure information. The careful consideration of such trade-offs in advertising research decisions will help in the preparation of extrinsic evidence before the Commission

Studying the Nature of Dark Energy with Galaxy Clusters

We report on the status of our effort to constrain the nature of dark energy through the evolution of the cluster mass function. Chandra temperature profiles for 31 clusters from a local cluster sample are shown. The X-ray appearance of the proto supermassive binary black hole at the center of the cluster Abell 400 is described. Preliminary weak lensing results obtained with Megacam@MMT for a redshift z=0.5 cluster from a distant cluster sample are given.Comment: 5 pages, to appear in: Aschenbach, B., Burwitz, V., Hasinger, G., Leibundgut, B. (eds.), Relativistic Astrophysics and Cosmology - Einstein's Legacy. ESO Astrophysics Symposia, Springer Verlag, Berlin, German

Flexible synthesis of polyfunctionalised 3-fluoropyrroles

An efficient and selective approach for the synthesis of polyfunctionalised 3-fluoropyrroles has been developed starting from commercial aldehydes. The methodology is concise, efficient and allows for the modular and systematic assembly of polysubstituted 3-fluoropyrroles. This synthesis provides an alternative and highly convergent strategy for the generation of these chemically and biologically important units

The link between post-qualification experience and self-confidence ratings in two problem-solving domains: a study of radiation therapists

Recognising one’s abilities and limits in clinical tasks is a valuable part of professionalism. This study investigated the self-ratings of problem-solving confidence of radiation therapists (RTs) in two domains: clinical scenarios and critical thinking items (CTIs). We divided the 60 participants into three groups based on post-qualification experience (PQE), and found that greater PQE was linkedwith higher selfrated confidence for clinical scenarios, but not for CTIs

Astrophysical Effects of Scalar Dark Matter Miniclusters

We model the formation, evolution and astrophysical effects of dark compact Scalar Miniclusters (``ScaMs''). These objects arise when a scalar field, with an axion-like or Higgs-like potential, undergoes a second order phase transition below the QCD scale. Such a scalar field may couple too weakly to the standard model to be detectable directly through particle interactions, but may still be detectable by gravitational effects, such as lensing and baryon accretion by large, gravitationally bound miniclusters. The masses of these objects are shown to be constrained by the Ly$\alpha$ power spectrum to be less than $\sim 10^4 M_\odot$, but they may be as light as classical axion miniclusters, of the order of $10^{-12} M_\odot$. We simulate the formation and nonlinear gravitational collapse of these objects around matter-radiation equality using an N-body code, estimate their gravitational lensing properties, and assess the feasibility of studying them using current and future lensing experiments. Future MACHO-type variability surveys of many background sources can reveal either high-amplification, strong lensing events, or measure density profiles directly via weak-lensing variability, depending on ScaM parameters and survey depth. However, ScaMs, due to their low internal densities, are unlikely to be responsible for apparent MACHO events already detected in the Galactic halo. A simple estimate is made of parameters that would give rise to early structure formation; in principle, early stellar collapse could be triggered by ScaMs as early as recombination, and significantly affect cosmic reionization.Comment: 13 pages, 12 figures. Replaced to reflect published versio

Unionization and Wage Inequality: A Comparative Study of the U.S, the U.K., and Canada

This paper presents a comparative analysis of the link between unionization and wage inequality in the U.S., the U.K., and Canada. Our main motivation is to see whether unionization can account for differences and trends in wage inequality in industrialized countries. We focus on the U.S., the U.K., and Canada because the institutional arrangements governing unionization and collective bargaining are relatively similar in these three countries. The three countries also share large non-union sectors that can be used as a comparison group for the union sector. Using comparable micro data for the last two decades, we find that unions have remarkably similar qualitative impacts in all three countries. In particular, unions tend to systematically reduce wage inequality among men, but have little impact on wage inequality for women. We conclude that unionization helps explain a sizable share of cross-country differences in male wage inequality among the three countries. We also conclude that de-unionization explains a substantial part of the growth in male wage inequality in the U.K. and the U.S. since the early 1980s.

The Evolution of the Returns to Human Capital in Canada, 1980-2005

We examine the evolution of the returns to human capital in Canada over the period 1980-2005. Our main finding is that returns to education increased substantially for Canadian men, contrary to conclusions reached previously. Most of this rise took place in the early 1980s and since 1995. Returns to education also rose, albeit more modestly, for Canadian women. Another important development is that after years of expansion, the wage gap between younger and older workers stabilized after 1995. Controlling for work experience and using Canadian Census data appear to account for the main differences between our results and earlier findings.Human Capital, Wage Differentials, Canada