Economy of Scale

There is now global evidence that it is cities and their immediate regions that drive economic growth. This report studies the Delhi National Capital Region (NCR), which accommodates India’s foremost economic agglomeration, through an economic geography lens that closely synergizes with urban and regional planning and governance.

A good model for the dynamic vehicle routing problem is the Dynamic Traveling Repairman Problem (DTRP) . The DTRP literature has focused on optimizing the expected value of system time, defined as the elapsed time between the arrival and the completion of each task. We focus on the stability and distribution of system time, including its variance. This paper establishes a partially policy independent necessary and sufficient condition for stability in the DTRP. The policy class includes some of the policies proven to be optimal for system time expectation under light and heavy loads in the literature. We propose a new policy named PART-n-TSP and compute a good approximation for its system time distribution. PART-n-TSP has lower system time variance than PART-TSP and Nearest Neighbor [4] when the load is neither too small or too large. We prove that PART-n-TSP is also optimal for system time expectation under light and heavy loads.

The Slovenian Energy Law, adopted in 1999, has opened the internal market to competition up to 64% of the final consumption. The opening of the internal market to foreign competition is envisaged for 2003. With regard to the methodology of price regulation, the Energy Law introduces the "price-cap" regulation, which aims to give firms incentive for cost reduction. To provide information for effective price regulation, we estimated a cost frontier function on a sample of Slovenian electricity distribution utilities over the 1991-2000 period. The estimated efficient frontier could be used by Slovenian regulatory agency as a benchmark to regulate network access prices. Our results show that Slovenian distribution companies are cost inefficient. We have also proved the presence of increasing returns to scale with most utilities not achieving the minimum efficient scale. Thus, the Slovenian regulatory authority should consider how to induce mergers of small electricity distribution utilities into larger units.

This paper explores the economies of scale and scope in the electricity, gas and water utilities. These issues have a crucial importance in the actual policy debates about unbundling the integrated utilities into separate entities, a policy which has often been supported by the ongoing reforms in the deregulation of network industries. This paper argues that the potential improvements in efficiency through unbundling should be assessed against the loss of scope economies. Several econometric specifications including a random-coefficient model are used to estimate a cost function for a sample of utilities distributing electricity, gas and/or water to the Swiss population. The estimates of scale and scope economies are compared across different models and the effect of heterogeneity among companies are explored. While indicating considerable scope and scale economies overall, the results suggest a significant variation in scope economies across companies due to unobserved heterogeneity.

Tbe process of specialisation of French farms: tecbnical cbanges and input price trend Key-utords: ttope econoill.tes, Jcate econon ies, agr icul tare, specialisation La spécialisation des exploitations agricoles: changements techniques et prix des facteurs Mots-clés: économies de gamme, économies d'échelle, agriculture, spécialisation Summary-For decadet, the French agricultttra/ sectar bas been characterised by farnt .rltecialitation and c\nceiltratiLn. Tbe competitiue equilibriuu tuitb a finite ntmber of fanu it tbe franeruork to analyse the cbanget in sca/e and scope econoruies and tbeir canseqaences on the rulectiae coupetitiueness af speciali:ed and d.iuersified farnu. This tbeoretical approach sbotus hatu tbe input ptice trend na1 explain tbe farn ryeria/i:ation pracess through thete tecbnical changes. Acrordingly, the eupirical analysis deals uith the dissociation of rhe anirnal and uegetal production lines, obsraed in tbe French farnu. According to au tbeoretica/ fratutuorh, the specialisation process uas nainly linked to tbe relatiue increase of the labow ' priaes, Up to 1987, rhe specialisation pernitted the puts at the sector leuel. In tbe saue tine, tbis inpat r higber in sun,iuing diuersified fants than in specialised farnts, At a contequeilce, rpecialisation uotld not haue indaced rnore laboar sauingt at the tector huel afnr 1987, and the specialisation procest has been stopped since. Résumé-L'évolurion de ['agriculture française est caractérisée par la concentrarion er [a spécialisation des exploications. Dans le cadre d'un équilibre concurtenriel comporrant un nombre fini d'exploitacions, la compétitivité relacive des ex-pLoirarions diversifiées et des exploitations spécialisées est décrite au lravers de l'évoi.rc.ion différenciée des économres d'échelle er des économies de gamme. Lapproche théorique montre comment l'évolution des prix des facceurs de production permet d'expliquer, au travers de ces changemenrs techniques la spécialisation des exploitations agricoles. Lanalyse empirique propose une incerprérarion de la dissociation des productions animale er végétale, observée dans le secreur agricoie. * INRA, Station d'éconorttie et sociologie rurales, 65, rue de Saint-Brieuc, 35042 Rennes cedex,

Genetically pure, uniform and dry seeds of greengram[Vigna radiata (L.) W ilczek] varieties Sujata and TARM-1 were treated with gamma rad iation of variab le doses (20, 30, 40, 50 and 60 kR) to assess the extent of mac ro-mutations induced in the M 2 generation and their scope for future use in p lant imp rovement programme. The irradiated seeds were sown in the M 1 field with their respective controls and harvested in bulk to raise the M 2 generation in Randomised Block Design(RBD) with three replicat ions. Wide spectrum of chlo rophyll and morphological macro mutants were observed in M 2 generation. Among the chlorophyll macro-mutants, chlorina was the most frequent in both cultivars. Among the morphological macro mutants, quadrifoliate was observed in highest frequency in variety Su jata and more poded type mutants in variety TARM-1. Nu mber of macro-mutations induced increased with rise in doses. The frequency of morphological mutation was higher in variety Sujata as compared to variety TA RM-1 suggesting higher sensitivity of the variety Sujata to gamma irradiat ion.

In the single-sink buy-at-bulk network design problem we are given a subset of source nodes in a weighted undirected graph: each source node wishes to send a given amount of flow to a sink node. Moreover, a set of cable types is given, each characterized by a cost per unit length and by a capacity: the ratio cost/capacity decreases from small to large cables by economies of scale. The problem is to install cables on edges at minimum cost, such that the flow from each source to the sink can be routed simultaneously. The approximation ratio of this NPhard problem was gradually reduced from O(log 2 n) to 65.49 by a long series of papers. In this paper, we design a better 24.92 approximation algorithm for this problem.

As part of its social policy, the government of Chile provides more than 1.8 million meals daily to public schoolchildren under the authority of Junta Nacional de Auxilio Escolar y Becas (JUNAEB), the state agency responsible for the program, at an annual cost of 360 million dollars. The service is provided by private firms chosen through an annual public auction. In order to capture economies of scale, a combinatorial auction design is implemented, allowing suppliers to bid on different sets of geographical units within the country. The bid evaluation process must solve multiple scenarios of a difficult combinatorial optimization model. To date, more than 2 billion dollars have been awarded under this methodology. In this paper, we describe the 2006 auction process and report that solution times can be significantly improved if the scenarios are solved in an appropriate order and the optimal solution to one scenario is employed as the initial solution of another. Results reflecting these improvements are given for real instances of the 2006 auction.

This study is on investigation of the productivity of Nigerian Shipping Industry, a study of some selected companies. In addressing the specific objectives, four hypotheses were formulated. Data was sourced through primary sources and secondary sources. The collected data were analyzed using Data Envelopment Analysis Model, Principal Component Analysis (PCA), Production Frontier Model Cobb Douglas Function, Data Envelopment Analysis (DEA) Model, Least Squares Regression–Based Estimation of Frontier. From the analysis Based on the significance of the p value at α = 0.05, the researcher reject the null hypothesis in favour of the alternative hypothesis. Therefore, the productivity of shipping companies was positively affected by capital input resources applied during the study period, in hypothesis two it is also significant at α = 0.05. Therefore, based on this result we again see a positive contribution of labour input with productivity in the case of these shipping companies. In hy...

Towards a Business Model for Viable City Logistics Initiatives The role of financial continuity, externalities and stakeholders Katsela, Konstantina 2020 Link to publication Citation for published version (APA): Katsela, K. (2020). Towards a Business Model for Viable City Logistics Initiatives: The role of financial continuity, externalities and stakeholders.

This paper addresses the challenge of achieving profitable city logistics initiatives. A case study examines the financial continuity of one such initiative in Sweden by exploring its cost structure, the relative importance of its revenue variables, and the variables that determine the economy of scale. The results show the potential of obtaining a viable business model and provide new insights into the economy of scale for city logistics. The paper presents a detailed cost-benefit analysis of the implementation of a six-month pilot programme for a city logistics initiative. The initiative combines the consolidation of transportation of goods for both private enterprises and municipalities, and shows that the relationship between goods volumes and profitability is not linear, but rather follows a logarithmic shaped curve. A sensitivity analysis highlights the impact of goods volumes and pricing on the financial performance of the business model.

We study two related network design problems with two cost functions. In the buy-at-bulk k-Steiner tree problem we are given a graph G(V, E) with a set of terminals T ⊆ V including a particular vertex s called the root, and an integer k ≤ |T |. There are two cost functions on the edges of G, a buy cost b : E −→ R + and a distance cost r : E −→ R +. The goal is to find a subtree H of G rooted at s with at least k terminals so that the cost e∈H b(e)+ t∈T −s dist(t, s) is minimized, where dist(t, s) is the distance from t to s in H with respect to the r cost. We present an O(log 4 n)-approximation algorithm for the buy-at-bulk k-Steiner tree problem. The second and closely related one is bicriteria approximation algorithm for Shallow-light k-Steiner trees. In the shallow-light k-Steiner tree problem we are given a graph G with edge costs b(e) and distance costs r(e), and an integer k. Our goal is to find a minimum cost (under b-cost) k-Steiner tree such that the diameter under r-cost is at most some given bound D. We develop an (O(log n), O(log 3 n))approximation algorithm for a relaxed version of Shallow-light k-Steiner tree where the solution has at least k 8 terminals. Using this we obtain an (O(log 2 n), O(log 4 n))-approximation algorithm for the shallow-light k-Steiner tree and an O(log 4 n)-approximation algorithm for the buy-at-bulk k-Steiner tree problem. Our results are recently used to give the first polylogarithmic approximation algorithm for the non-uniform multicommodity buy-at-bulk problem [9].

We consider two models of stochastic serial inventory systems with economies of scale for which the forms of optimal policies are known. In the first model, each stage has a fixed-order quantity, while in the second model, there is a fixed-order cost for external supplies. For each model, we show that the optimal policy parameters can be bounded and approximated by a series of independent, single-stage optimal policy parameters. We further construct closed-form bounds and approximations for the single-stage solutions and apply them to the serial systems. These results provide simple and effective solutions that will help to facilitate implementations in practice. They also allow us to see the connections between the serial and single-stage systems and sharpen our intuition on optimal policy parameters and system behavior.

Den hastige udbygning af biogassektoren, hovedsagelig i Tyskland, har i de seneste år skabt et kolossalt marked for avancerede styrings-og reguleringsværktøjer til biogasanlæg i alle størrelser. Traditionelle sensorer såsom simple gasanalysatorer og pH-prober ...

The Spanish electric sector is empirically analysed using a multistage -multiproduct quadratic cost function estimated with data on firms from 1985 to 1996. Economies of both vertical (EVI) and horizontal (EHI) integration are calculated through economies of scope. Estimated EVI indicate that joint generation and distribution saves 6.5% of costs, lower than what has been obtained in similar studies in the USA. This difference suggests that expenses in both system coordination and market transactions are a relevant source of economies, already accounted for in the Spanish electric sector where a central coordination agency exists. EHI between generation products are somewhat larger.

I traditionel økonomistyring og internt regnskabsvaesen registreres normalt kun hvad man kunne kalde de direkte målbare kvalitetsomkostninger. Disse bygger på, at kun synlige effekter fra kvalitetsproblemer indgår i virksomhedens beslutningsgrundlag. På grund af øget fokus på kvalitet-og dermed på kvalitetsomkostningernes voksende betydning, specielt i relation til virksomhedens forøgede anvendelse af avanceret og fleksibelt produktionsudstyr, hvor flere produkter ofte produceres sammen og dermed påvirker prioritetsraekkefølgen-bør en virksomhed gøre sig tanker om hvordan de forskellige produktvarianter og ordrer påvirker ressourcer og kvalitetsomkostninger. For at tage højde for dette, betragtes en beregningsmodel til at visualisere defektprocenternes betydning rent omkostningsmaessigt i sammenhaeng med de traditionelle produktionsparametre, som kapacitetsudnyttelse, ordrestørrelse, teknologi etc. Størrelsen af disse afledte omkostninger børså vidt der ikke er mulighed for elimineringogså indgå i virksomhedens langsigtede beslutningsgrundlag og formål. Indledning 1 Kvalitetsomkostninger (KVO) er, ofte sammen med omkostninger til fleksibilitet i litteraturen, kaldt for »dårligt-strukture-149

Delhi-National Capital Region (NCR) is an economic development-based region conceived to absorb the huge migration into Delhi and accommodate employment requirements and civic necessities. It is a planning region with a cumulative economy of USD 370 billion and pulls in nearly a quarter of India’s total foreign direct investment. e role of agglomeration e ects and the economy of scale is pivotal in shaping this region as an economic hub. Although the service sector-related activities constitute a staggering 66% of its total GDP, only 26% is contributed by the NCR’s secondary sector. is secondary sector is a large employer in the region and has huge potential and scope for further development. is review paper explores the literature related to the changing nature and pattern of the industrial sector, which comprises of approximately 17% and 6% of the total economy of the NCR and Delhi, respectively. It also intends to assess the infrastructure, migration, and income types and pattern...

Delhi-National Capital Region (NCR) is an economic development-based region conceived to absorb the huge migration into Delhi and accommodate employment requirements and civic necessities. It is a planning region with a cumulative economy of USD 370 billion and pulls in nearly a quarter of India’s total foreign direct investment. e role of agglomeration e ects and the economy of scale is pivotal in shaping this region as an economic hub. Although the service sector-related activities constitute a staggering 66% of its total GDP, only 26% is contributed by the NCR’s secondary sector. is secondary sector is a large employer in the region and has huge potential and scope for further development. is review paper explores the literature related to the changing nature and pattern of the industrial sector, which comprises of approximately 17% and 6% of the total economy of the NCR and Delhi, respectively. It also intends to assess the infrastructure, migration, and income types and pattern...

Froudbyttet i hvidklover er pavirket af en lang raekke dyrkningsfaktorer. I okologisk produktion har forsog gennem de senere ar vist, at skadedyr kan reducere froudbyttet vaesentligt. Umiddelbart findes ingen dyrkningsmaessige tiltag, som kan lose dette problem. Faktorer som plantetaethed har endvidere stor betydning for afgrodens udbyttepotentiale.

Jeg vii benytte lejligheden til at takke stud.oecon. Louise Hindrichsen, bibliotekarstuderende Solvejg Tolstrup og stud.scient.adm. Rene Nielsen for deres arbejde og engagement i forbindelse med projektets opstart, ligesom min kollega, lektor Mogens 0. Madsen skal takkes for god inspiration. Endvidere skal der t?emsmttes en tak til Anders Hummehnose, Nordjysk Landbrugsrådgivning for stor imedekommenhed ved fiemskaffelse af faktuelle oplysninger. Sidst-men ikke mindst-tak til Institut for Økonomi, Politik og Forvaltning for okonomisk st0tte til projektets apstart. Aalborg Universitet i februar 1997 Jan Holm Ingemamr Fremstillingen afsluttes med presentation af nogle pointer som grundlag for overvejelser omkring en mere hensigtsmmssig udformning af landbrugspolitikken. ' Da 2. verdenskrig bred ud havde landbrugssektoren ikke hall gnuullag for en modernisering, da de ekonomiske sår eller 30-emes tise ikke var overnmdet. Der ekslsterede således en stor, men forazldet og noget slidt landbrugssektor ved krigens udbrud. Under krigen havde landbruget rimeligt gode okonorniske forhold, men ikke de praktiske muligheder for investeringer i saxligt omfang. * De6neret som forholdet mellem det primaxe landtigs salgspriser og priser på imlk&e råvarer m.v. ' Der tznkes ber på hjemmemarkedsordningerne, hvorefier Lmdbruget tia 1958 i relation til overenskomstforhandlingeme på arbejdamarkedet germemfmte sine egne "overenskomstforhandlinger" med

We establish a necessary and sufficient condition for stability in the dynamic traveling repairman problem (DTRP) [3] under the class of polling-sequencing (P-S) policies satisfying unlimited-polling and economy of scale. The P-S class includes some of the policies proven to be optimal for the expectation of system time under light and heavy loads in the DTRP literature. The number of tasks inside each polling partition is shown to be a Markov chain. Policies such as first come first serve, traveling salesman policy, nearest neighbor and Daganzo's algorithm are shown to have economy of scale.

In this paper we propose a model to explain the behaviour of the Spanish electrical utility industry during the period 1987-1997, under the then existing regulatory system (Marco Legal Estable). The paper will study the presence of economies of scale, the effect of technological progress and the differences in the efficiency of the different companies within the market. The paper concludes that the Spanish electrical utility industry was not, in fact, characterized by economies of scale during this period, but witnessed a great improvement in efficiency within that period. All the critical market factors remind stable.

Esta versão contém as críticas e sugestões dos elementos do Juri.O presente trabalho tem como escopo averiguar se existem benefícios comuns entre as compras compartilhadas e os serviços compartilhados. Para tanto, objetiva-se trabalhar com duas variáveis, padronização e economia de escala. A abordagem da pesquisa será quantitativo-qualitativa. O enquadramento é denominado como pesquisa exploratória, tendo em vista que é o formato de pesquisa mais adequado quando esta se tratar de estudo de caso. Para a variável economia de escala pretende-se verificar os custos com mão de obra e o custo com publicações nas compras do Instituto Federal de Ciência e Tecnologia de Rondônia (IFRO), como também a verificação de economia de escala com base nos dados de compras de bens de consumo e serviços, aferindo se o volume de demanda dos mesmos têm implicação no preço. Os dados dessa variável encontram-se em repositório público, compras governamentais do Governo Federal. Para a pesquisa referente à v...

We test a mechanism whereby groups are formed endogenously, through the use of voting. Once formed, groups play a public-goods game, where there are economies of scale: the social value of an incremental contribution to the group account increases with the size of the group. Societies of nine people are initially formed randomly into three groups of three people, with

Delhi-National Capital Region (NCR) is an economic development-based region conceived to absorb the huge migration into Delhi and accommodate employment requirements and civic necessities. It is a planning region with a cumulative economy of USD 370 billion and pulls in nearly a quarter of India’s total foreign direct investment. e role of agglomeration e ects and the economy of scale is pivotal in shaping this region as an economic hub. Although the service sector-related activities constitute a staggering 66% of its total GDP, only 26% is contributed by the NCR’s secondary sector. is secondary sector is a large employer in the region and has huge potential and scope for further development. is review paper explores the literature related to the changing nature and pattern of the industrial sector, which comprises of approximately 17% and 6% of the total economy of the NCR and Delhi, respectively. It also intends to assess the infrastructure, migration, and income types and pattern...

As part of its social policy, the government of Chile provides more than 1.8 million meals daily to public schoolchildren under the authority of Junta Nacional de Auxilio Escolar y Becas (JUNAEB), the state agency responsible for the program, at an annual cost of 360 million dollars. The service is provided by private firms chosen through an annual public auction. In order to capture economies of scale, a combinatorial auction design is implemented, allowing suppliers to bid on different sets of geographical units within the country. The bid evaluation process must solve multiple scenarios of a difficult combinatorial optimization model. To date, more than 2 billion dollars have been awarded under this methodology. In this paper, we describe the 2006 auction process and report that solution times can be significantly improved if the scenarios are solved in an appropriate order and the optimal solution to one scenario is employed as the initial solution of another. Results reflecting these improvements are given for real instances of the 2006 auction.

Since 1990s the liner shipping industry has faced a period of restructuring and consolidation, and been confronted with a continuing increase in container vessel scale. The impact of these changes is noticeable in trade patterns, cargo handling methods and shipping routes, in short 'operations'. After listing factors influencing size, growth in container ship size is explained by economies of scale in deploying larger vessels. In order to quantify economies of scale, this paper uses the liner service cash flow model. A novelty in the model is the inclusion of '6000-20-foot Equivalent Unit (TEU) vessels and the distinction in costs between single and twin propeller units on ships. The results illustrate that scale economies have been Á and will continue to be Á the driving force behind the deployment of larger container vessels. The paper then assesses the link between ship size and operations, given current discussions about the increase in container vessel scale. It is found that (a) ship size and operations are linked; (b) optimal ship size depends on transport segment (deep-sea vs. short-sea shipping, SSS), terminal type (transhipment terminals vs. other terminals), trade lane (East-West vs. North-South trades) and technology; and (c) a ship optimal for one trade can be suboptimal for another.

The Slovenian Energy Law, adopted in 1999, has opened the internal market to competition up to 64% of the final consumption. The opening of the internal market to foreign competition is envisaged for 2003. With regard to the methodology of price regulation, the Energy Law introduces the "price-cap" regulation, which aims to give firms incentive for cost reduction. To provide information for effective price regulation, we estimated a cost frontier function on a sample of Slovenian electricity distribution utilities over the 1991-2000 period. The estimated efficient frontier could be used by Slovenian regulatory agency as a benchmark to regulate network access prices. Our results show that Slovenian distribution companies are cost inefficient. We have also proved the presence of increasing returns to scale with most utilities not achieving the minimum efficient scale. Thus, the Slovenian regulatory authority should consider how to induce mergers of small electricity distribution utilities into larger units.

This note generalises models from two influential papers in the theory of supply chain outsourcing under competition: McGuire and Staelin (1983) and Cachon and Harker (2002). The first paper studies the impact of competitive intensity on the outsourcing decision from the supplier's point of view for linear supply cost; the second paper examines the impact of supply economies of scale from the retailer's point of view when selling perfectly substitutable products. By considering competitive intensity and supply economies of scale simultaneously, we find that equilibrium channel structures are primarily determined by the competitive intensity, which is true even under supply diseconomies of scale; the key message in the second paper of scale economies driving retailer's outsourcing supply decision is highly dependent on the assumption of perfect substitutes. Our finding has no qualitative difference when either the suppliers or the retailers are modeled as the channel leader and make the outsourcing decisions.

Over the past two decades, institutions that make microloans to low-income borrowers in developing and transition economies have focused increasingly on making their lending operations financially sustainable by charging interest rates that are high enough to cover all their costs. They ...

It is a general perception that the Philippine public and private higher educational institutions differ markedly in their cost structures in servicing the degree programs they offer. This perception might be motivated by the well recognized differences between government-run and private HEIs with respect to a number of attributes-their sizes, their business orientations, their priorities in service provision, their funding sources and their scale and/or scope economies. Hence, in empirically establishing the cost function of the country's HEIs, it is postulated in the present study that there exist distinct cost functions for the two types of institutions. This study, which supplements the Commission on Higher Education (CHED) commissioned project entitled "A Comprehensive Analysis of Degree Programs" aims to econometrically establish the empirical cost functions for the country's higher education degree programs for public and private HEIs.

As part of its social policy, the government of Chile provides more than 1.8 million meals daily to public schoolchildren under the authority of Junta Nacional de Auxilio Escolar y Becas (JUNAEB), the state agency responsible for the program, at an annual cost of 360 million dollars. The service is provided by private firms chosen through an annual public auction. In order to capture economies of scale, a combinatorial auction design is implemented, allowing suppliers to bid on different sets of geographical units within the country. The bid evaluation process must solve multiple scenarios of a difficult combinatorial optimization model. To date, more than 2 billion dollars have been awarded under this methodology. In this paper, we describe the 2006 auction process and report that solution times can be significantly improved if the scenarios are solved in an appropriate order and the optimal solution to one scenario is employed as the initial solution of another. Results reflecting these improvements are given for real instances of the 2006 auction.

We consider a multi-product serial two echelon inventory system with stochastic demand. Inventories at the downstream location are replenished periodically using an automatic ordering system. Under vendor managed inventory strategies the upstream stage is allowed to adapt these orders in order to benefit from economies of scale. We propose three different VMI strategies, aiming to reduce the order picking cost at the upstream location and the transportation costs resulting in reduced total supply chain costs. In a detailed numerical study the VMI strategies are compared with a retailer managed inventory strategy for two different demand models suitable for slow moving products. It is shown that if inventory holding costs are low, compared to handling and transportation costs, efficiencies at the warehouse are improved and total supply chain costs are reduced.

This paper illustrates the transformation going on in the new local loop architectures for multimedia services due to new technologies, both wireline and wireless. New local loop architectures such as the hybrid fiber / coax (HFC), fiber to the curb (FTTC) and, in the future, fiber to the home / building (FTTH / B) tend to have production and economic cost characteristics that are fundamentally different from the traditional twisted pair copper distribution networks. Their scale economies tend to be lower and there are also strong indications of significant economies of scope that were not available to either telephone or cable television networks of the past. Policy implications are: (1) that it is very unlikely that a single uniform architecture will prevail in the way that twisted copper pair dominated the telephone network and coax cable dominated cable television in the past. Rather, the local loop of the future is more likely to be characterized by heterogeneous technologies. (2) We will see increased competition in the local loop due to a low probability of effective entry preemption and entry encouraged by reduced economies of scale and new economies of scope.

As part of its social policy, the government of Chile provides more than 1.8 million meals daily to public schoolchildren under the authority of Junta Nacional de Auxilio Escolar y Becas (JUNAEB), the state agency responsible for the program, at an annual cost of 360 million dollars. The service is provided by private firms chosen through an annual public auction. In order to capture economies of scale, a combinatorial auction design is implemented, allowing suppliers to bid on different sets of geographical units within the country. The bid evaluation process must solve multiple scenarios of a difficult combinatorial optimization model. To date, more than 2 billion dollars have been awarded under this methodology. In this paper, we describe the 2006 auction process and report that solution times can be significantly improved if the scenarios are solved in an appropriate order and the optimal solution to one scenario is employed as the initial solution of another. Results reflecting these improvements are given for real instances of the 2006 auction.

In the single-sink buy-at-bulk network design problem we are given a subset of source nodes in a weighted undirected graph: each source node wishes to send a given amount of flow to a sink node. Moreover, a set of cable types is given, each characterized by a cost per unit length and by a capacity: the ratio cost/capacity decreases from small to large cables by economies of scale. The problem is to install cables on edges at minimum cost, such that the flow from each source to the sink can be routed simultaneously. The approximation ratio of this NPhard problem was gradually reduced from O(log 2 n) to 65.49 by a long series of papers. In this paper, we design a better 24.92 approximation algorithm for this problem.