Firm Flows Research Articles

Quantifying the potential impacts of land-use and climate change on hydropower reliability of Muzizi hydropower plant, Uganda

Abstract Ugandan rivers are being tapped as a resource for the generation of hydropower in addition to other uses. Studies on the reliability of these hydropower plants due to climate and land-use/land cover changes on the hydrology of these rivers are scanty. Therefore, this study aimed to model the impact of the changing climate and land-use/cover on hydropower reliability to aid proper planning and management. The hydropower reliability of Muzizi River catchment was determined from its past (1998–2010) and midcentury (2041–2060) discharge at 30 and 95% exceedance probability under Representative Concentration Pathways (RCPs) of 4.5 and 8.5, respectively. The past and projected hydropower were compared to determine how future climate and land-use changes will impact the discharge and hydropower reliability of Muzizi River catchment. Six LULC scenarios (deforestation, 31–20%; grassland, 19–3%; cropland, 50–77%; water bodies, 0.02–0.01%; settlement, 0.23–0.37%, and Barren land 0.055–0.046% between 2014 and 2060) and three downscaled Regional Climate Model (REMO and RCA4 for precipitation and RACMO22T for temperature from a pool of four CORDEX (Coordinated Regional Climate Downscaling Experiment) Africa RCMs) were examined. A calibrated SWAT simulation model was applied for the midcentury (2041–2060) period, and a potential change in hydropower energy in reference to mean daily flow (designflow ≥ 30% exceedance probability), firm flow (flow ≥ 95% exceedance probability), and mean annual flow was evaluated under the condition of altered runoff under RCP4.5 and RCP8.5 climate change scenarios for an average of REMO and RCA4 RCM. The future land use (2060) was projected using the MOLUSCE (Module for Land Use Change Evaluation) plugin in QGIS using CA-ANN. Three scenarios have been described in this study, including LULC change, climate change, and combined (climate and LULC change). The results suggest that there will be a significant increase in annual hydropower generation capacity (from 386.27 and 488.1 GWh to 867.82 and 862.53 GWh under RCP4.5 and RCP8.5, respectively) for the combined future effect of climate and land-use/cover changes. Energy utilities need to put in place mechanisms to effectively manage, operate, and maintain the hydropower plant amidst climate and land-use change impacts, to ensure reliability at all times.

The Cost of Poor Institutions: Estimations Based on Chinese Firm Flows

ABSTRACT This study estimates the cost of poor institutions using cross-provincial firm investments in China based on its unique land policies. We find that provinces with better institutions attract more firm investment and that institutions are substitutive with land price distortion. Firms with high (low) labor productivity move primarily between provinces with better (inferior) institutions. This stratification effect suggests that a poor institutional environment has dynamic costs, hindering technology diffusion from provinces with good institutions to those with poor institutions. The results imply that it is difficult to achieve industrial upgrades by factor price distortion rather than institutional environment improvements.

Current Assets Management, Remuneration, and Operating Cash Flow of UAE Construction Companies

This paper examines the effect of current assets management and remuneration on operating cash flow of construction firms listed in the United Arab Emirates stock market before and after the financial crises of 2008. The results present a negative and significant relationship between cash conversion cycle and operating cash flow for the full sample. The results also show a negative and significant relationship between the cash conversion cycle and operating cash flow of the firms during the crisis period. This indicated that the UAE construction companies were more efficient in managing their current assets during the crisis period.

The impact of patent citation information flow regarding economic innovation on common stock returns: Volume vs. patent citations

This study examines whether the number of forward patent citations (along with alternative patent data)—when used as a proxy for the mixing variable—could infer the aggregate amount of economic-innovation information arriving at the New York Stock Exchange (NYSE) in the United States. The results show that the number of forward patent citations, when used as a mixing variable, fails to eliminate total volatility persistence in the conditional variance equation of the exponential generalized autoregressive conditional heteroscedastic (EGARCH) model. However, the trading volume successfully eliminates total volatility persistence, thus confirming the validity of the framework used. When the volatility is modeled with an expectation of mean return, the persistence of conditional variance is deterministically increased, and the sum of the volatility coefficients exceeds unity. The inclusion of trading volume with a time trend in the variance equation rectifies the deterministic increase in the conditional volatility. These findings suggest that the form of heteroscedasticity (i.e., as per the autoregressive conditional heteroscedastic model, ARCH model) in NYSE portfolio returns is based on the type of shocks to volatility (e.g., deterministic vs. stochastic), which manifests as news arrivals (i.e., new information arrivals proxied by trading volume) at the stock market. The volume therefore reflects the time dependence in the innovations to the ARCH error generation process. The response of volatility to volume persists over time when the volatility estimates are derived from the EGARCH model with an expectation for the mean of return. Backward patent citations, patent applications, and patents issued have been found to interact somewhat with trading volume, suggesting that each of these variables could play the role of an absorptive capacity variable as the new information flow associated with economic innovation (i.e., flow of firms’ stock of new knowledge) could be picked up by the trading volume.

Modeling Business Land Use Equilibrium for Small Firms’ Relocation and Consumers’ Trip in a Transportation Network

This paper studies the integrated models for small and medium-sized enterprises’ distribution and consumers’ trip in an urban network based on the simultaneous equilibrium approach. In this paper, each firm aims at finding some business centers to set up shops to maximize his net profit while each consumer is a traveler who chooses his destination (business center) and travel route according to the minimization of individual net social cost, which is equal to the cost of travel time minus the destination attraction measure. The contribution of this paper can be divided into three parts. Firstly, a new deterministic equilibrium model is developed to capture consumers’ travel choice and firms’ location choice. The relocation cost between any two business centers is explicitly considered. Furthermore, the business center passenger/firm flow capacity constraint is incorporated into the previous model. Mathematically, we prove that this extension will derive the endogenous location transfer market in a business center for firms if the maximum firm flow capacity is reached at equilibrium. Finally, we extend the preceding deterministic models to the stochastic case.

Comments: Gross worker and job flows in Europe by M. Burda and C. Wyplosz

The BW paper is stimulating because it addresses a difficult and important problem — how can the introduction of worker and firm heterogeneity in the processes of employment and job dynamics be used to simultaneously explain labor force flows and job creation and destruction? The paper provides one example of a tightly parameterized model that generates theoretical predictions for each of the major worker and firm flows. Although, these predictions have not been tested as thoroughly as one might have hoped, the BW framework makes clear that such tests are both feasible and economically interesting.

The “Ins” and “Outs” of the Firm's Flow of Funds

The “Ins” and “Outs” of the Firm's Flow of Funds