Marginal abatement cost (MAC) is a critically important concept for efficient environmental policy and management. In this paper we argue that most empirical studies using frontier estimation methods such as data envelopment analysis (DEA) over-estimate MACs. The first methodological contribution of to clarify the conceptual distinction between shadow price MAC in order analyze three sources up...

We use the implementation of a new prospective payment system (PPS) for inpatient rehabilitation facilities (IRFs) to investigate the effect of changes in marginal and average reimbursement on costs. The results show that the IRF PPS led to a significant decline in costs and length of stay. Changes in marginal reimbursement associated with the move from a cost-based system to a PPS led to a 7-1...

In a model where two competing downstream firms establish an input joint venture (JV), we analyze how different royalty rules for covering fixed costs affect channel profits. Under running royalties (regardless of whether based on predicted or actual output), the downstream firms’ perceived marginal costs are above the true marginal costs since fixed costs are incorporated. We find that tougher...

Previously, personalized service was provided by traditional channel. Now, they are available online by using web channel. Some unique features of a web channel make it different from a traditional channel. Previous research has studied the competition between a web channel and a traditional channel from various angles. In this paper, we develop a model to examine the impact of switching costs ...