Fixed costs or common budgets often exist in numerous economic contexts which must be allocated among the entities making up an organization. Let’s say this is the case of a university that has to share a certain amount of money to buy equipment (microscopes, software, etc.) among the different degree courses. The dilemma facing the manager in charge is how to allocate the budget fairly among t...

We analyze Bertrand’s price competition in a homogenous good market with a fixed cost and an increasing marginal cost (i.e., with variable returns to scale). If the fixed cost is avoidable, we show that the non-subadditivity of the cost function at the output corresponding to the oligopoly break-even price, denoted by D(pL(n)), is sufficient to guarantee that the market supports an equilibrium ...

OPTIMAL SCHEDULING FOR CHARGING ELECTRIC VEHICLES WITH FIXED SETUP COSTS

We extend Melitz (2003) to allow for both global and bilateral fixed export costs. If global (bilateral) export costs dominate, the average sales ratio (import sales per product variety/domestic sales per variety), decreases (increases) in variable (fixed) trade barriers, due to adjustment along the intensive (extensive) margin of trade. Using novel data on bilateral US movie exports we find th...

The techniques and methods of developing cost models for respirators are discussed. Models are developed and implemented in this study for nineteen types of respirators in two major classes (air-purifying and supplied-air) and one LEV system. One respirator model is selected for detailed discussion from among the twenty models. The technical cost method is used in constructing the cost models f...

Farmers incur proportional and fixed transactions costs in selling their crops on markets. Using data for Peruvian potato farmers, we propose a method to measure these transactions costs. When opportunities exist to sell a crop on alternative markets, the observed choice of market can be used to infer a monetary measure of transactions costs in market participation. The market choice model is f...

We consider the periodic-review, single-location, single-product, production/inventory control problem under non stationary demand and service-level constraints. The product is perishable and has a fixed shelf life. Costs comprise fixed ordering costs and inventory holding costs. For this inventory system we discuss a number of control policies that may be adopted. For one of these policies, we...