Academic literature on the topic 'Differentiated capital cost'

Article reveals the growing need for increased investment in projects for the modernization and development of the motor road network and identifies the problem of high capital intensity of road construction facilities and the duration of the investment payback period that hinder the inflow of private investments. By analyzing the economic aspects of road infrastructure, the authors have developed the economic and mathematical model for optimizing the placement of asphalt-concrete plants and the cost of producing the asphalt mix, the algorithm for optimizing the cost of road facility construction, the algorithm for selecting effective investment options for commercial roadside projects.

AbstractThe English government has encouraged private providers – known as Independent Sector Treatment Centres (ISTCs) – to treat publicly funded (NHS) patients. All providers are to be remunerated under a prospective payment system that offers a price per case treated, adjusted by the Market Forces Factor (MFF) to reflect geographical variation in specific input costs. This payment system presupposes that any remaining cost differentials between providers result from inefficiencies. However, the validity of this assumption is unclear. This article describes the constraints that could cause public and private provider costs to differ for reasons outside their control. These constraints may be regulatory in nature, such as taxes and performance management regimens, or relate to the production process, such as input costs, the provision of emergency care, and case mix issues. Most of these exogenous cost differentials can be rectified by adjustments either to the regulatory system or to the payment method. However, differences in capital costs appear less tractable and further investigation into possible solutions is warranted.

Factor subsidies in a perfectly competitive setting are analysed. A very general model is used to derive expressions for the effect of a factor subsidy on the price and quantity of output and the two factor inputs. These expressions are differentiated to generate qualitative results for the impact of changes in the product-demand, production-function, and factor-supply parameters on the subsidy effects. A similar procedure is used to investigate the exchequer cost per job of general labour and capital subsidies in an industry with Cobb — Douglas technology. The analysis is relieved with illustrative simulations in which ‘representative’ parameter values are used.

Purpose – The purpose of this paper is to explore unequal dividend payment policies called differentiated dividends (DDs) in Korea. The characteristics of firms are examined which allocate higher dividends to small shareholders than large shareholders within the same share class. Design/methodology/approach – Logit analysis is used to compare firms that initiate DDs with those that pay conventional equal dividends. The abnormal market reaction to news of initiation of DDs is also examined. Findings – Managers of firms facing cash insufficiency are more likely to initiate DDs. The DD scheme is used as a method to cater to high dividend demands in the market. The stock price reaction to the initiation of DDs is positive when the total dividend payments are increased, signifying that the market interprets it as good news. Practical implications – Firms facing cash insufficiency can avoid an increase in the cost of capital by retaining extra cash from DDs rather than borrowing external funds. Additionally, managers can foster favorable market reactions by using DDs which helps firms in attracting new capital investments. Finally, regulatory bodies can consider encouraging managers to adopt unequal dividend schemes to allow higher dividend payments to small shareholders, especially in countries with weak legal protection for minority shareholders. Originality/value – Similar unequal dividend policies exist in European countries but there is a lack of research conducted on those policies. The paper provides implications for the strategic use of unequal dividends to maximize firm value.

<p>This study examines whether normative pressures from stock market regulators to improve the governance quality of Brazilian listed firms influence the participation and activism of institutional investors. More specifically, we investigate the association between institutional investor’s ownership and firm’s voluntary adhesion to the São Paulo Stock Exchange (B3) differentiated levels of corporate governance quality. Empirical testing is performed on a ten-year (2002–2011) panel data set from a sample of 439 firms listed on the B3. Our findings suggest that firms in differentiated corporate governance levels, that is, with better level of transparency and commitment to monitoring, are more attractive to institutional investors. We interpret this result as evidence supporting the shareholder activism movement, attributed by several scholars to institutional shareholders. Our study contributes to the governance literature on the firm’s response to normative pressures and the ability of internal governance mechanisms to signal lower agency cost to capital market. Our evidence also contributes to the ongoing discussion about the role and influence of institutional investors in the functioning of capital markets, and more specific in emerging market like Brazil.</p>

The present study contributes to the literature on international migration by examining social, demographic and contextual factors that influence modes of labor market incorporation and occupational cost among new immigrants during their first years after migration. The data for the analysis were obtained from the 1983 Census or Population conducted by Israel's Central Bureau of Statistics. The analysis focuses on men who immigrated to Israel between 1979 to 1983. Although most immigrants are able to join the economically active labor force shortly after arrival, they do so by adopting different strategies and at a substantial occupational cost. The data reveal that the likelihood of finding employment, the mode of labor market incorporation, and the size of the occupational cost are significantly affected by geocultural origin, occupation in the country of origin, and individual-level demographic and human capital resources. The meaning of the differentiated effects are discussed in detail. The findings point toward two central aspects that should be examined in the study of labor market incorporation of new immigrants: employment status and occupational cost.

Purpose On the basis of principal-agent and financing constraints theories, the purpose of this paper is to construct a unified research framework via mathematical models and to provide a logical and consistent explanation of the contradictory discovery of the relationship between dividend payment and I-CFO in the previous literature. Design/methodology/approach Establishing the economic mathematical models, this paper uses the comparative static analysis to figure out the equilibrium results, to further testify the conclusions, the authors initiate the empirical tests to make the discussion more realistic. Findings The authors observe that overinvestment caused by agency problems is the primary reason for I-C sensitivity when the investment expenditure is less than the internal capital; dividend payout suppresses the overinvestment caused by the agency problem, thus alleviating the investment’s dependence on the internal capital. However, underinvestment caused by the financing constraints is the primary cause of I-C sensitivity when the investment expenditure is greater than the internal capital. The payment of cash dividends increases the investment shortage caused by the financing constraints, thus increasing the sensitivity. Further, the authors explore the impact of dividend payments on I-CFO sensitivity. They argue that dividend payment is not an appropriate measure of financing constraints. Both I-CFO sensitivity and I-C sensitivity are functions of agency cost and information cost. Research limitations/implications This study provides a logical and consistent explanation of the contradictory discovery of the relationship between dividend payment and I-CFO in the previous literature and provides a clear framework and reference for future studies on the impact of financial constraints, agency cost on the investment’s dependence on the internal capital. Practical implications The theoretical model of this paper supports this differentiated mandatory dividend policy and provides reference and evidence for China's financing policies and dividend distribution policies. Originality/value This study theoretically and empirically analyzes and verifies the roles of agency cost and financial constraints on the determinants of I-C sensitivity for the first time. First, different from earlier literature, this paper puts forward I-C sensitivity as a new measure of investment’s dependence on internal capital, making the measurement more accurate. In the case of a firm with positive liquidity reserves, using the I-CFO sensitivity as a measure of external financing constraints could overestimate the firm’s financial constraints. Second, by constructing an economic static analysis framework, this study analyzes how I-C and I-CFO sensitivities change with the agency cost, the financing constraints and the dividend payment ratio. The research provides a basic framework and explanation on the contradictions of the earlier literature. The results are supposed to serve as a foundation for estimations of investment’s dependence on internal capital and should be embedded in general empirical tests in future research.

In the first paper of this series of three, Harvey's ‘circuits of capital’ argument was discussed, and was linked first to ground rent theory, and second to forms of social change and crisis in advanced, Western-style economies. In the present paper these various theoretical insights are used to reflect upon the urban housing market in Melbourne from the 1930s to the 1980s. It is concluded (1) that average rent (average annual cost relative to wages), and thereby housing-related accumulation, rose virtually uninterrupted from 1932 to 1977, providing the incentive to the suburbanisation boom of the 1950s and 1960s; (2) that an extraordinary rise in average rent in 1973 – 74 (to be viewed as ‘absolute rent’) created an affordability barrier, inhibiting the ability of the housing sector to provide an outlet for speculative investment in the current ‘global crisis’; and (3) that differentiated shifts in monopoly ground rent (that is, price rises in some submarkets and falls in others) thereby became increasingly important in providing incentive for both speculative and productive investment in housing. The third paper will extend this empirical exploration to the social conditions enabling these processes, and in turn affected by them.

Oil and gas companies are fairly large users of electricity, and the rising cost of electricity has become a major issue for the sector. Oil and gas producers often develop their own gas-fired generation plants and consume their own gas as generation fuel. An increasing price of gas in the domestic market has resulted in a corresponding increase in the opportunity cost of utilising gas for power generation. Declining costs of renewable energy and battery storage open opportunities for oil and gas companies to reduce the consumption of their own gas and source electricity at a lower cost, as well as achieve their sustainability objectives. Gas-fired generation is expected to continue to play a key role in ensuring the reliability of electricity supply. However, the percentage of renewable energy in the supply mix can be increased significantly without compromising the reliability. This paper will focus on the opportunities that exist for oil and gas companies to reduce their overall energy supply costs through a differentiated approach considering renewable energy sources and batteries, competitive tendering of energy supply requirements, and attracting capital from independent power producers and institutional investors. The paper will draw on lessons learnt from other energy intensive businesses in Australia.

The study evaluates the nature of market structure, and the degree and determinants of market power in the Zimbabwean banking sector during the period 2009-2014. The study employs the Lerner Index approach method to assess the market power of banks. The Lerner Index approach assists in measuring the extent to which a bank has market power to set its price above marginal cost. The study results established that the banking sector operates under monopolistic competition, confirming that banks possess some market power in pricing their products. This is a result of the nature of products sold by the banking sector, which are differentiated but close substitutes. The study found that the market power of banks increased during the period and was derailed by the memorandum of association which was signed between banks and the central bank. The study established that market power is determined by capital adequacy, non-performing loans, liquidity risk, cost income ratio, economic growth, and regulatory interventions. The study recommends that the government should ensure that it puts in place measures that enhance economic growth and should desist from interfering with the operations of market forces.

Armatec tillhandahåller system, produkter och funktionella lösningar inom värme, kyla och process. Företaget har lager i Sverige, Norge och Danmark. Under senare tid har företaget sett att lagret i Norge utgör en stor kostnad. Armatec har därför börjat fundera på om de skulle tjäna på att centralisera logistikstrukturen dvs. stänga lagret i Norge och utöka centrallagret i Göteborg. Syftet meddetta examensarbete är att undersöka huruvida lagret behövs i Norge eller ej. Den metod som arbetet använder sig av är Dupont - modellen eller avkastningsmodellen. Genom att använda denna modell beräknas lagerkostnaderna, transportkostnaderna, lagerstorlek, kapacitetsutnyttjande osv. Dessutom gör man en analys av leveransprecision, leveranssäkerhet, leveranstid och leverensflexibilitet. Arbetet har gått genom dessa punkter och finner att lagerräntabiliteten ökar med 13% om företaget Armatec stänger sitt lager i Norge. Detta under villkor att leveransservicenivån förbättras. Transportkostnaderna ökar något men inte markant i det här sammanhanget. Arbetet berör också andra typer av metoder som behandlar lagerlokaliserings fråga nämligen tyndpunktsmetoden, matematiska modeller samt Analytic Hierarchy Process (AHP) Uppsatsen använder sig av en differentierad lagerhållningsränta för att beräkna lagerkostnaderna. Man har dock utgått ifrån en multivariabel ABC analys för att klassificera produkterna. En kvalitativ metod nämligen SWOT- analysen dvs. Styrka ,Svaghet, möjligheter och Hot avslutar detta arbete. Slutstaten med detta examensarbete är att Armatec skulle tjäna på en centralisering av lagerstrukturerna. Författaren vill påminna läsaren att Företaget vill behålla sitt lager i Köpenhamn. Det är därför Köpenhamn inte igår i arbetet. Företaget har inget lager i Finland. Arbetet visar också att den finska marknaden inte kommer att påverkas i samband med centralisering

When aero-derivative gas turbines were first introduced into industrial service, the prime criterion for assessing the “relative value” of equipment was derived hy dividing the initial (or capital) cost of the equipment by the number of kilowatts produced. The use of “dollars per kilowatt” as an assessment parameter emanated from the utility sector and is still valid providing that the turbo-machinery units under consideration possess similar performance features with regard to thermal efficiency. Second generation gas turbines being produced today possess thermal efficiencies approximately forty-five percent greater than those previously available. Thus, a new criterion is required to provide the purchaser with a better “value” perspective to differentiate the various types of turbo-machinery under consideration. This paper presents a technique of combining the initial cost of equipment with the costs of fuel consumed, applied labor and parts to arrive at an assessment parameter capable of comparing the relative merits of varying types of turbo-machinery. For simplicity, this paper limits the life cycle cost derivation and discussion to turbo-generator units; however, the principles of this type of life cycle analysis can also be applied to gas turbines in mechanical drive applications and/or combined cycles.