Creating Fragility Functions for Performance-Based Earthquake Engineering

The Applied Technology Council is adapting PEER's performance-based earthquake engineering methodology to professional practice. The methodology's damage-analysis stage uses fragility functions to calculate the probability of damage to facility components given the force, deformation, or other engineering demand parameter (EDP) to which each is subjected. This paper introduces a set of procedures for creating fragility functions from various kinds of data: (A) actual EDP at which each specimen failed; (B) bounding EDP, in which some specimens failed and one knows the EDP to which each specimen was subjected; (C) capable EDP, where specimen EDPs are known but no specimens failed; (D) derived, where fragility functions are produced analytically; (E) expert opinion; and (U) updating, in which one improves an existing fragility function using new observations. Methods C, E, and U are all introduced here for the first time. A companion document offers additional procedures and more examples

Determinants of the Timing and Incidence of Exploratory Drilling on Offshort Wildcat Tracts

This paper documents exploratory drilling activity on offshore wildcat oil and gas leases in the Gulf of Mexico that were sold between 1954 and 1990, with emphasis on the period before 1980. For each year of the lease, we study the determinants of the decision whether or not to begin exploratory drilling, and the outcome of any drilling activity. Our results indicate that equilibrium predictions of plausible noncooperative models are reasonably accurate, and more descriptive than those of cooperative models of drilling timing. We discuss why noncooperative behavior may occur, and the potential gains from coordination.

Patterns of Trade in the Market for Used Durables: Theory and Evidence

The consumption value of a durable good diminishes as it ages due to physical deterioration and consumers' preference for the new. We develop a model of consumer specialization and trade in the market for used durables based on imperfect substitutability. Imperfect substitutability across vintages is reflected in a declining market price over time. Heterogeneous consumers maximize utility by specializing in durables of differing ages. Consumers must trade to acquire their preferred vintage each period. When there are transaction costs in the secondhand market, the volume of trade due to specialization increases with imperfect substitutability. We examine the determinants of vehicle ownership transfers in Illinois, a measure of trade volume. Observed patterns of trade across automobile model years are consistent with our model, and inconsistent with a model of adverse selection.

Bidding Rings and the Winner's Curse: The Case of Federal Offshore Oil and Gas Lease Auctions

This paper extends the theory of legal cartels to affiliated private value and common value environments, and applies the theory to explain joint bidding patterns in U.S. federal government offshore oil and gas lease auctions. We show that efficient collusion is always possible in private value environments, but may not be in common value environments. In the latter case, fear of the winner's curse can cause bidders not to bid, which leads to inefficient trade. Buyers with high signals may be better off if no one colludes. The bid data is consistent with oil and gas leases being common value assets, and with the prediction that the winner's curse can prevent rings from forming on marginal tracts.

Ohio School Milk Markets: An Analysis of Bidding

We examine the institutional details of the school milk procurement process, bidding data, statements of dairy executives, and supply characteristics in Ohio during the 1980's. We compare the bidding behavior of a group of firms to a control group. We find that the behavior of each of the firms differs from that of the control group. We argue that the behavior of these firms is consistent with collusion. The estimated average effect of collusion on market prices is about six and one half percent, or roughly the cost of shipping school milk about 50 miles.

Explaining the Effects of Campaign Finance Reform on Electoral Competitveness in Governors\u27 Races

This study examines the impact of stringent campaign contribution laws on competition in gubernatorial contests. In addition to the stringency of campaign contribution laws, however, it explores several other potential causes of competition. For instance, this study considers the availability of public funding, a state’s vote for president, the existence of an open seat race, income of a state, state population, the institutional powers of a given state’s governor, and the winning party. This study ultimately demonstrates the extent to which campaign contribution limits have little effect on gubernatorial competitiveness. Of the alternatives, both the presence of an open seat and the availability of public financing to challengers proves partially determinative, and present additional avenues for further research

Empirical Implications of Equilibrium Bidding in First-Price, Symmetric, Common Value Auctions

This paper studies federal auctions for wildcat leases on the Outer Continental Shelf from 1954 to 1970. These are leases where bidders privately acquire (at some cost) noisy, but equally informative, signals about the amount of oil and gas that may be present. We develop a test of equilibrium bidding in a common values model that is implemented using data on bids and ex post values. We compute bid markups and rents under the alternative hypotheses of private and common values and find that the data are more consistent with the latter hypothesis. Finally, we use data on tract location and ex post values to test the comparative static prediction in common value auctions that bidders may bid less aggressively when they expect more competition.