Convergence of Probability Measures. By P. Billingsley. Chichester, Sussex, Wiley, 1968. xii, 253 p. 9 1/4“. 117s.

Convergence of Probability Measures

This chapter discusses leading problems linked to energy that the world is now confronting and to propose some ideas concerning possible solutions. Oil deserves special attention among all energy sources. Since the beginning of 1981, it has merely been continuing and enhancing the downward movement in consumption and prices caused by excessive rises, especially for light crudes such as those from Africa, and the slowing down of worldwide economic growth. Densely-populated oil-producing countries need to produce to live, to pay for their food and their equipment. If the economic growth of the industrialized countries were to be 4%, even if investment in the rational use of energy were pushed to the limit and the development of nonpetroleum energy sources were also pursued actively, it would be extremely difficult to prevent a sharp rise in prices. It is evident that it is absolutely necessary to pursue actively the development of coal, natural gas, and nuclear power if a physical shortage of energy is not to block economic growth.

World energy outlook

Framework Convention on Climate Change

The importance of remanufacturing used products into new ones has been widely recognized in the literature and in practice. In this paper, we address the problem of choosing the appropriate reverse channel structure for the collection of used products from customers. Specifically, we consider a manufacturer who has three options for collecting such products: (1) she can collect them herself directly from the customers, (2) she can provide suitable incentives to an existing retailer (who already has a distribution channel) to induce the collection, or (3) she can subcontract the collection activity to a third party. Based on our observations in the industry, we model the three options described above as decentralized decision-making systems with the manufacturer being the Stackelberg leader. When considering decentralized channels, we find that ceteris paribus, the agent, who is closer to the customer (i.e., the retailer), is the most effective undertaker of product collection activity for the manufacturer. In addition, we show that simple coordination mechanisms can be designed such that the collection effort of the retailer and the supply chain profits are attained at the same level as in a centrally coordinated system.

https://ink.library.smu.edu.sg/cgi/viewcontent.cgi?article=6102&context=lkcsb_research

Closed-Loop Supply Chain Models with Product Remanufacturing

A review of computer tools for analysing the integration of renewable energy into various energy systems

In this first part of a two-part article, the principal characteristics of the TIMES model and of its global incarnation as ETSAP-TIAM are presented and discussed. TIMES was conceived as a descendent of the MARKAL and EFOM paradigms, to which several new features were added to extend its functionalities and its applicability to the exploration of energy systems and the analysis of energy and environmental policies. The article stresses the technological nature of the model and its economic foundation and properties. The article stays at the conceptual and practical level, while a companion article is devoted to the more detailed formulation of TIMES equations. Special sections are devoted to the description of four optional features of TIMES: lumpy investments, endogenous technology learning, stochastic programming, and the climate module. The article ends with a brief description of recent applications of the ETSAP-TIAM model.

http://home.eng.iastate.edu/~jdm/ee590-Old/TIMES1.pdf

ETSAP-TIAM: the TIMES integrated assessment model Part I: Model structure

In this paper we analyze the joint implications of two effects: (a) inserting independent profit-maximizing retailers into thechannel system provides "buffering" to the manufacturers from price competition when their products are highly substitutable and intrachannel contracts are observable (as shown by McGuire and Staelin 1983 under the assumption of constant marginal production costs), and, (b) lack of channel coordination results in a reduction in manufacturer's incentives to invest in efforts to reduce production costs (as shown by Jeuland and Shugan 1983 for the case of bilateral monopoly). We show that both these results are robust in the sense that the first holds even in the presence of the vertical externality of manufacturer's effort reduction in a noncoordinated channel, and the second holds regardless of the degree of substitutability between the competing channel's products. Specifically, we analyze a four-stage game with two manufacturers and two retailers, where the intrachannel contracts are linear and observable and manufacturers make investments in process improvements to reduce their production costs. We find that the optimal channel structure decision depends on interactions between two parameters: the degree of substitutability between products and the level of investments required to achieve production cost reduction. These parameters represent what have been widely interpreted in the management literature as the two primary "generic strategies" that most organizations follow in order to gain competitive advantage: cost leadership and product differentiation (Porter 1980). Thus, our analysis brings out the strategic and interdisciplinary nature of the channel structure decision that can significantly affect firm profitability. Our main results are as follows. First, we find that decentralized, noncoordinated channels appear as more profitable equilibrium than integration (or perfectly coordinated channels) at high product substitutability even when process innovation dimension is accounted for, in agreement with the literature. However, the range of substitutability over which decentralization is an equilibrium strategy is smaller the easier it is to reduce production costs. Intuitively, the easier the cost reduction, the larger the cost penalty that the channel incurs as a result of not coordinating investment and pricing decisions between channel members, and thus smaller the range over which decentralization is an equilibrium. This implies that there is an explicit tradeoff between efficiency and strategic incentives in distribution channel design. Second, we show that decentralized manufacturers invest less in process innovation than integrated manufacturers do, regardless of the structure of the competing channel and the degree of substitutability between products. Consequently, a decentralized channel has higher costs, charges higher prices, and produces lower quantities than an integrated channel does. Moreover, these differences get larger the easier the cost reduction. The effect on manufacturer profits, however, is not that clear. Manufacturers make higher profits by decentralizing if products are highly substitutable, inagreement with McGuire and Staelin (1983) and Coughlan and Wernerfelt (1989). However, we also find that the relative profitability of decentralization at high substitutability (and of integration at low substitutability) increases the easier the cost reduction. Moreover, the range of substitutability over which decentralization is more profitable than integration is itself larger the easier the cost reduction (though decentralization is an equilibrium strategy over a smallerrange). Thus, process innovation accentuates the profit difference between integrated and decentralized channels andmakes the Prisoner's Dilemma situation worse in the choice of distribution channel structure. Finally, we analyze two examples of coordinated decision making in a channel: a divisional integrated system and franchising. In the first case, we find that decentralization can emerge as a unique (and more profitable) equilibrium at high product substitutability, in contrast to McGuire and Staelin(1983). In the second case, we find that decentralization is not always a unique equilibrium and it is not always more profitable than integration, in sharp contrast to the results by Coughlan and Wernerfelt (1989). Thus, franchising does not provide a sure way of achieving channel coordination when marginal production costs are not constant. In sum, this paper highlights the importance of simultaneously considering both the horizontal and the vertical dimensions of interorganizational relations on one hand and, on the other, paying attention to cross-functional interactions across marketing and operational decisions to better understand the underlying incentives that shape firm and market structures; conventional focus of marketing on demand side effects and of operations on cost side effects can lead to suboptimal decisions.

Process Innovation, Product Differentiation, and Channel Structure: Strategic Incentives in a Duopoly

This article is a companion to “ETSAP-TIAM: the TIMES integrated assessment model. part I: model structure”. It contains three sections, presenting respectively: the simplified formulation of the TIMES Linear Program (Sect. 1), the details of the computation of the supply demand equilibrium (Sect. 2), and the Endogenous Technology Learning Formulation (Sect. 3). The full details of these three formulations are available in the complete TIMES documentation at www.etsap/org/documentation.

ETSAP-TIAM: the TIMES integrated assessment model. part II: mathematical formulation

Information on ETSAP, its activities and members is also provided on the Inter-net. The home page contains the latest news, general information on ETSAP, and links to: ETSAP members; ETSAP 'outreach' activities; description of the MARKAL model and its users; archives of new items; selected publications and the ETSAP Newsletter.

Energy Technology Systems Analysis Programme

There is a revival in the nuclear debate observed in the literature. Most of theemission scenarios of the Intergovernmental Panel on Climate Change (IPCC) show animportant role for nuclear energy to satisfy energy demand in the long term. Moreover,several analyses have shown that nuclear technologies may represent very attractiveoptions for greenhouse gas (GHG) emission reductions, especially in developing coun-tries with high growth projections for energy demand. Our objective is to analyze therole of nuclear energy in long-term climate scenarios using the World-TIMES bottom-up model. World-TIMES is a global model with 15 regions that optimizes their entireenergy system over a 100-year horizon (2000–2100).We present energy and emission results for climate scenarios for two levels of CO 2 concentration (450 and 550 ppmv by 2100). We speciﬁcally analyze the penetrationlevel of nuclear energy in these scenarios, under various sets of assumptions on tech-nology parameters and exogenous constraints on nuclear energy development to reﬂectsocial perceptions.We highlight the fact that nuclear technologies satisfy most of the electricity pro-duction in all scenarios. The 450 ppmv scenario imposes very stringent technologicalchanges. Most regions experience an energy transition based on advanced oil and gastechnologies and by developing hydropower at the maximum potential. Other renew-able technologies could play a more important role, but need further cost reductionsor new regulations to penetrate the market in substantial proportions. Carbon seques-tration and endogenous demand reductions for energy services are also signiﬁcantlycontributing to reach environmental target.Key Words: Nuclear energy, World-TIMES model, Climate scenarios.

Richard Loulou

Papers

ETSAP-TIAM: the TIMES integrated assessment model Part I: Model structure

Process Innovation, Product Differentiation, and Channel Structure: Strategic Incentives in a Duopoly

ETSAP-TIAM: the TIMES integrated assessment model. part II: mathematical formulation

Energy Technology Systems Analysis Programme

The Role of Nuclear Energy in Long-Term Climate Scenarios: An Analysis with the World-TIMES model