This paper models a machine replacement and capacity expansion problem as an infinite-horizon linear program. We establish a strong duality result and show that stationary dual prices are optimal, regardless of initial conditions. These prices measure the economic value of owning vintage machinery and thus define depreciation schedules. We present necessary and sufficient conditions for straigh...

This paper uses a multicountry econometric model to examine Asia-type crises. Experiments are run for Thailand, Malaysia, the Philippines, and Korea, each corresponding to a depreciation of the country’s currency. The results suggest that both the expansionary and inflationary effects of a depreciation are in general fairly large.

Research and development (R&D) depreciation rates are critical to calculating the rates of return to R&D investments and capital service costs, both of which are important for capitalizing R&D investments in the national income and product accounts. Although important, measuring R&D depreciation rates is extremely difficult because both the price and output of R&D capital are generally unobserv...

This study analyzes the technical-economic feasibility study for construction of solar plants in 14 different locations of Khuzestan province in Iran. The HOMER software, Data Envelopment Analysis (DEA), Balanced Scorecard (BSC), and Game Theory (GT) were used for ranking the areas in the province. The outputs of the HOMER software includes the kind of equipment to be used for building of each ...

One of the primary assumptions in most optimal pricing methods is that the production cost is a non-increasing function of lot-size. This assumption does not hold for many real-world applications since the cost of unit production may have non-increasing trend up to a certain level and then it starts to increase for many reasons such as an increase in wages, depreciation, etc. Moreover, the prod...

It is commonly accepted in the industrial organization literature that rate of return regulation leads to inefficient outcomes. Since prices are calculated so as to cover the regulated firm’s average cost, which includes the periodic fixed costs associated with plant property and equipment, the conventional argument is that prices must exceed the marginal cost of production. This paper examines...

This paper applies an extended version of the superior goods model to the UK car market. The model involves the estimation of separate equations for the demand for new cars and the rental price of used cars. We have allowed for the direct influence of quality on car demand by using a measure derived from hedonic price equations. We have employed three measures of the user cost, reflecting diffe...