Differential Game Model for Disaster Relief Cooperation between Host Government and Private Sector

The decision of the private sector to fulfil corporate social responsibility (CSR) has become an issue of common concern for the host country government and the private sector in collaborative disaster relief. From the perspective of social responsibility, this paper describes the different cooperation strategies of non-cooperation, cost subsidy, and collaborative cooperation, and constructs a differential game model of disaster relief cooperation between the government and the private sector. The rate of reputational decay has a significant effect on system benefits. The optimal CSR cost subsidy rate is related to marginal revenue and has nothing to do with other factors. Compared with the non-cooperative case, in the situation of the cost of subsidies, as the host country government and marginal revenue is greater than the private sector of the marginal revenue through government subsidies for the private sector in CSR and the government's optimal level of CSR efforts remained unchanged, the optimal level of CSR efforts to improve the private sector, the government, and the private sector's earnings are improving; Compared with the cost subsidy, the optimal CSR effort level of the government and the private sector increases in the case of collaborative cooperation, and so does the system benefit.

Research on the Operation Model and Strategy of Lithium Battery to Provide Frequency Regulation in the Power System

With the development of smart grid and energy internet, energy storage will play an important role in maintaining the power balance and providing frequency regulation in future power system. Consequently, energy storage faces a trade-off problem between the energy market and frequency regulation market. In this work, an operation model and strategy of energy storage to provide frequency regulation is proposed. Taking lithium battery as an example of energy storage, its technical feasibility to provide frequency regulation is firstly discussed. Then, a day-ahead energy market model in the power system is constructed to calculate the revenue of lithium battery. Finally, the operation strategy of lithium battery to provide secondary frequency regulation (namely AGC) is proposed based on the model of opportunity cost. Case study is conducted on a modified IEEE 6-bus system. It shows that the reduced marginal revenue of lithium battery in the energy market increases with the growth of its declared capacity for frequency regulation. Consequently, the optimal declared frequency regulation capacity for lithium battery is the amount, at which the reduced marginal revenue in the energy market is equal to the compensation price of frequency regulation.

Are the Lowest-Paid UFC Fighters Really Overpaid? A Comment on Gift (2019)

In a recent article in this Journal, Gift (2019) attempts to measure the marginal revenue product (MRP) of individual Ultimate Fighting Championship (UFC) fighters. According to Gift’s estimates, top-tier UFC Fighters are frequently and substantially underpaid relative to their MRP while “a sizable percentage of UFC fighters generated little to no MRP,” and are consequently “overpaid by traditional measures.” In this Comment, we examine possible explanations for this finding, including various limitations of Gift’s data and methods. We also examine the underlying economics of the sport, in which quasi-fixed broadcast revenue streams, ignored in Gift's MRP estimates, play a large and increasingly dominant role. As Berri et al. (2015 ) have emphasized, comparisons of athlete compensation and standard MRP metrics (even if estimated correctly) are “meaningless” in the presence of substantial quasi-fixed revenues. Critically, Gift assumes zero MRP for all fighters in all bouts in all non-Pay-Per-View (PPV) events. As a result, Gift's method assumes fighters are “overpaid” for the vast majority (75 percent) of fighter-bouts. Even setting this aside, we argue that Gift's use of Google Trends data—at best an extremely crude proxy for a fighter's contribution to PPV revenue—suffers from measurement error, producing attenuation bias. As a consequence, Gift's data and methods are likely to substantially underestimate UFC fighters’ economic value.

Macro and Micro Dynamics of Productivity: From Devilish Details to Insights

Firm-level, revenue-based productivity measures are ubiquitous in studies of firm dynamics and aggregate outcomes. One common measure is increasingly interpreted as reflecting “distortions” since in distortions’ absence, equalization of marginal revenue products should yield no dispersion in this measure. Another common but distinct measure is the residual of the firm-level revenue function, which reflects “fundamentals.” Using micro-level US manufacturing data, we find these alternative measures are highly correlated, exhibit similar dispersion, and have similar relationships with growth and survival. However, the distinction between these alternative measures is critically important for quantitative assessment of the level and decline of allocative efficiency. (JEL D21, D22, D24, G32, L60)

A Bioeconomic Analysis of a Renewable Resource in the Presence of Illegal, Unreported and Unregulated Fishing

The issue of illegal, unreported and unregulated (IUU) fishing is of prime concern to fisheries in developing countries where the regulatory regimes are often weak. This study proposes a Gordon-Schaefer bioeconomic model with non-constant catchability and nonlinear cost to study the impact of IUU fishing on the stock size of a marine fishery in Ghana. The static equilibrium reference points of the model are established and discussed. Bifurcation analysis on the modified Schaefer model shows the existence of a transcritical bifurcation point were the model is structurally unstable. Pontryagin’s maximum principle is employed to investigate the necessary conditions of the model, and also established are the sufficiency conditions that guarantee the existence and uniqueness of the optimality system. The characterization of the optimal control gives rise to both the boundary and interior solutions, with the former indicating that the resource should be harvested if and only if the marginal revenue of harvest exceeds the marginal revenue of stock. Numerical simulations with empirical data on the Ghana sardinella are carried out to validate the theoretical results. It is shown that IUU fishing leads to excessive exploitation of the resource biomass to levels below 50% of the carrying capacity. This has the tendency of making the fishery unsustainable, with its concomitant loss of revenue to fishers.

An optimal freshness-keeping effort model for fresh produce with constraints of special funds

<p style='text-indent:20px;'>The quality deterioration in the post-production process of fresh products is very serious, and the life-cycle freshness-keeping technology investment is an effective way to reduce the deterioration. Because the investment cost is high in practice, enterprises need to allocate special funds for each stage to maximize their marginal revenue. In this paper, we use freshness to characterize the quality level of fresh products and investigate a maximize marginal revenue problem where a firm assigns special funds for the freshness-keeping effort with each post-production process. An optimal freshness-keeping model with the constraints of special funds is discussed. The investigation shows that both the optimal freshness-keeping effort and the closed-form optimal solutions of enterprises exist uniquely. A reasonable freshness-keeping investment in different post-production processes can improve the performance of enterprises with limited fund constraints. We then simulate the effect rules of funds constraint on these solutions based on numerical analysis and give some management insights.</p>