Incentive Costs Research Articles

Service providers’ experiences of using a telehealth network 12 months after digitisation of a large Australian rural mental health service

BackgroundDespite evidence of benefits of telehealth networks in increasing access to, or providing, previously unavailable mental health services, care providers still prefer traditional approaches. For psychiatric assessment, digital technology can offer improvements over analog systems for the technical and, subsequently, the social quality of provider-client interaction. This is in turn expected to support greater provider uptake and enhanced patient benefits. ObjectiveWithin the framework of Innovation Diffusion Theory, to study service providers’ experiences of an existing regional telehealth network for mental health care practice twelve months after digitisation in order to identify the benefits of digital telehealth over an analog system for mental health care purposes in rural Australia. MethodsQualitative interviews and focus groups were conducted with over 40 service providers from June to September 2013 in South Australia, ranging from the metropolitan central operations to health providers located up to 600km away in rural and remote areas of the same state. Participants included rural mental health teams, directors of nursing at rural hospitals, metropolitan-based psychiatrists and registrars, the metropolitan-based mental health team dedicated to rural provider support, rural GPs, administrative staff, and the executive group of the state rural health department. Fieldwork was conducted 12 months after the analog system was digitised. The interview and focus group data were analysed using thematic analysis, focusing on three key areas of innovation diffusion theory: relative advantage, technical complexity and technical compatibility. ResultsFive themes with 11 sub-themes were identified: (1) “Existing Uses”, with three sub-themes: current mental health use, use by GPs, and use for staff support; (2) “Relative Advantage”, with four sub-themes: improved technical quality, improved clinical practice, time and cost benefits for providers, and improved patient care; (3) “Technical Complexity”; (4) “Technical Compatibility” with two sub-themes: technical-clinical and technical-administrative; and (5) “Broader Organisational Culture”, with two sub-themes: organizational policy support and ‘digital telehealth' culture. ConclusionsThe digitised telehealth network was generally well received by providers and adopted into clinical practice. Compared with the previous analog system, staff found advantages in better visual and audio quality, more technical stability with less “drop-out”, less time delay to conversations and less confusion for clients. Despite these advantages, providers identified a range of challenges to starting or continuing use and they recommended improvements to increase uptake among mental health service providers and other providers (including GPs), and to clinical uses other than mental health. To further increase uptake and impact of telehealth-mediated mental health care in rural and remote areas, even with a high quality digital system, future research must design innovative care models, consider time and cost incentives for providers to use telehealth, and must focus not only on technical training but also how to best integrate technology with clinical practice and must develop an organization-wide digital telehealth culture.

Permanent and Temporary Policy Incentives for Conservation under Stochastic Returns from Competing Land Uses

AbstractRapid conversion of private land for agricultural and urban use has raised concern worldwide over the loss of ecological services. To inform conservation policy, we model privately optimal land use decisions using a real options framework that assumes both the ecological and commercial values of land are stochastic and that land conversion is irreversible. We analyze permanent and temporary land conservation policy incentives using this dynamic framework to guide policy makers interested in designing efficient payment mechanisms to achieve ecological preservation goals. We find that while the financial cost of temporary policy incentives is generally much lower than permanent policy incentives, this difference is very small in scenarios with high discount rates and lower uncertainties in conversion returns and lower expected trend in conservation returns. Alternately, the financial cost of temporary conservation is substantially lower than that of permanent conservation when the expected trend in conservation returns and uncertainties in conservation and conversion returns is high and the discount rate is low. Comparison with net present value and single‐source uncertainty models indicates that the presence of a second uncertainty increases the option value of delaying conversion, and shows that permanent and temporary policy incentives based on either of the two simpler models can be seriously misguided if multiple uncertainties are present. We illustrate the analytical results with a case study of tropical deforestation in Indonesia where private landowners can either conserve forests and earn carbon credits, or convert to palm oil agriculture and earn profits from the sale of palm oil.

Technical and Economic Assessment of a 10 MW Wind Farm at Pakphanang District in Nakhon Si Thammarat Province

This paper presents the technical and economic assessment of a 10 MW wind farm at Pakphanang district in Nakhon Si Thammarat province, southern Thailand. The microscale wind resource map within 10 km is developed based on 3 years recorded wind data at 120 m above ground level (agl) (2012-2014) along with computational fluid dynamic (CFD) wind flow modeling with resolution of 90 m. The 5 x 2.0 MW and 4 x 2.5 MW modeled wind farms are positioned along the shoreline with a position criteria of 5 times the rotor diameter between the turbines. The net annual energy production (AEP) and capacity factor (CF) with wake losses are analyzed. The economic analysis is done based on the current project cost and financial incentive (Adder). Results show that the annual mean speed at 120 m agl is 5.2 m/s. The net AEP and CF are 36.60 GWh/year and 41.78%, respectively with wake loss of 0.40%. Under project cost of 75 million THB/MW and 70% debt ratio and Thailand Board of Investment (BOI) tax exemption promotion, the benefit cost ratio is 1.04, the net present value is 65.96 million THB, the financial internal rate of return is 17.70% and the payback period is 4 years. Finally, a 10 MW wind power project could avoid greenhouse gas emission of 19,764 tons CO2eq per year.Keywords: Wind Energy, Wind Farm, Capacity Factor, Wind Flow Modeling, Project Analysis

The interaction of pillars in multi‐pillar pension systems: A comparison of Canada, Denmark, Netherlands and Sweden

AbstractCanada, Denmark, the Netherlands and Sweden have advanced multi‐pillar pension systems. Using micro‐simulations, this article presents a close examination of the interaction of pillars in these countries. The relative importance and the role of the different pension pillars vary from country to country, and according to age, income, gender and socio‐economic dimensions as well as between generations. A further area of investigation is the mitigation capacity of the four pension systems. On the one hand, adverse labour careers lead to lower life‐time earnings and lower private pension accruals. On the other hand, these effects are mitigated through the design of pillars and their interaction. Mitigation is important to income security and stability in retirement and to post‐retirement income distribution. However, mitigation mechanisms come at the cost of incentives. Moreover, in many countries, the generosity of public benefits is set to decrease – increasing the importance of private pensions. This will shift risk and uncertainty from employers and pension institutions to individuals. Thus, risks and uncertainties related to private pensions will become more important, raising questions about the division of responsibilities between public and private pensions, and about the potential of mitigating such risk through pillar interaction. These concerns are further reinforced by labour market changes. Although a pension system free of distortions is inconceivable, this article seeks to contribute to addressing how mitigation should be designed, and how mitigation and risk sharing should be balanced against incentives, challenges which are as much political as technical.

Modeling the demand for a shared-ride taxi service: An application to an organization-based context

Traffic congestion has become a worldwide concern. One way to address this problem is to enhance the performance of the transport system by means of sound public transportation that is capable of appropriately addressing the demand of travelers, especially in highly urbanized areas of the world. The implementation of shared-ride transportation has been a viable transportation solution in many areas. The purpose of this study is to evaluate the market demand potential of a Shared-Ride Taxi (SRT) service in an organization-based context. It presents an integrated choice and latent variable modeling framework for modeling the number of times per week a Shared-Ride Taxi would be used if it were implemented at an organization. The study involves extensive analysis of practical policy scenarios through which the impact of cost incentives (subsidies) and multiple SRT attributes on travelers’ behavior is examined.Using stated preference data, the model is applied to a case study of the students at the American University of Beirut in Lebanon. Research results are expected to provide an initial evaluation of the market potential for a Shared-Ride Taxi in a university setting in Lebanon. Results reveal that 30–50% of the students are willing to utilize the Shared-Ride Taxi service under practical scenarios and that subsidies are likely to play a key role in increasing the SRT ridership.

Collusion and biased tournaments

Tournaments are vulnerable to collusion. This paper finds that biased tournaments can be more effective at preventing collusion than unbiased ones. When agents can collude to exert low effort, introducing some bias into tournaments generates opposite effects on favored and disfavored agents׳ respective incentives to exert high effort and provides strong incentives for the favored agent to deviate from collusion. Introducing an adequate degree of bias reduces the principal׳s incentive cost for preventing collusion; however, granting excessive bias instead increases the incentive cost. We show that the optimal level of bias can be endogenously determined.

The earnings management opportunity for US oil and gas firms during the 2011 Arab Spring event

Purpose – This study aims to examine whether US oil and gas companies engaged in earnings management during the 2011 Arab Spring, which resulted in significant increases in both crude oil and gasoline prices. Design/methodology/approach – Following a similar research methodology from prior research, this study tests the existence of earnings management based on discretionary total accruals, current accruals and non-current accruals to determine whether both large petroleum refining firms and relatively small oil and gas-producing firms, jointly and separately, lowered reported earnings. Findings – The results show that, overall, US oil and gas companies as a group engaged in income-decreasing earnings management during the Arab Spring. The results seem to support the political cost hypothesis. However, further analyses indicate that the results are driven by abnormal income-decreasing accruals of the relatively small oil and gas-producing firms, which are politically less sensitive. Research limitations/implications – The findings suggest that there may be other non-political cost incentives, such as income smoothing, for the relatively small oil and gas-producing firms managing earnings downward during periods of large oil price increases. However, the possibility for firms with reversals of income-increasing activity from other quarters is not ruled out. Originality/value – This study not only is the first empirical study of earnings management by oil and gas companies during the Arab Spring, but also contributes to extant earnings management literature regarding political cost hypothesis, which still remains a major concern for US oil and gas companies.

Getting a Valid Survey Response From 662 Plastic Surgeons in the 21st Century.

Web-based surveys save time and money. As electronic questionnaires have increased in popularity, telephone and mailed surveys have declined. With any survey, a response rate of 75% or greater is critical for the validity of any study. We wanted to determine which survey method achieved the highest response among academic plastic surgeons. All American Association of Plastic Surgeons members were surveyed regarding authorship issues. They were randomly assigned to receive the questionnaire through 1 of 4 methods: (A) emailed with a link to an online survey; (B) regular mail; (C) regular mail + $1 bill, and (D) regular mail + $5 bill. Two weeks after the initial mailing, the number of responses was collected, and nonresponders were contacted to remind them to participate. The study was closed after 10 weeks. Survey costs were calculated based on the actual cost of sending the initial survey, including stationary, printing, postage (groups B-D), labor, and cost of any financial incentives. Cost of reminders to nonresponders was calculated at $5 per reminder, giving a total survey cost. Of 662 surveys sent, 54 were returned because of incorrect address/email, retirement, or death. Four hundred seventeen of the remaining 608 surveys were returned and analyzed. The response rate was lowest in the online group and highest in those mailed with a monetary incentive. Despite the convenience and low initial cost of web-based surveys, this generated the lowest response. We obtained statistically significant response rates (79% and 84%) only by using postal mail with monetary incentives and reminders. The inclusion of a $1 bill represented the greatest value and cost-effective survey method, based on cost per response.

The Optimal Timing of Unemployment Benefits: Theory and Evidence from Sweden

This paper provides a simple, yet robust framework to evaluate the time profile of benefits paid during an unemployment spell. We derive sufficient-statistics formulae capturing the marginal insurance value and incentive costs of unemployment benefits paid at different times during a spell. Our approach allows us to revisit separate arguments for inclining or declining profiles put forward in the theoretical literature and to identify welfare-improving changes in the benefit profile that account for all relevant arguments jointly. For the empirical implementation, we use administrative data on unemployment, linked to data on consumption, income, and wealth in Sweden. First, we exploit duration-dependent kinks in the replacement rate and find that, if anything, the moral hazard cost of benefits is larger when paid earlier in the spell. Second, we find that the drop in consumption affecting the insurance value of benefits is large from the start of the spell, but further increases throughout the spell. In trading off insurance and incentives, our analysis suggests that the flat benefit profile in Sweden has been too generous overall. However, both from the insurance and the incentives side, we find no evidence to support the introduction of a declining tilt in the profile. (JEL D82, E21, E24, J64, J65)

Does OTC Derivatives Reform Incentivize Central Clearing?

The reform program for the over-the-counter (OTC) derivatives market launched by the G-20 nations in 2009 seeks to reduce systemic risk from OTC derivatives. The reforms require that standardized OTC derivatives be cleared through central counterparties (CCPs), and they set higher capital and margin requirements for non-centrally cleared derivatives. Our objective is to gauge whether the higher capital and margin requirements adopted for bilateral contracts create a cost incentive in favor of central clearing, as intended. We introduce a model of OTC clearing to compare the total capital and collateral costs when banks transact fully bilaterally versus the capital and collateral costs when banks clear fully through CCPs. Our model and its calibration scheme are designed to use data collected by the Federal Reserve System on OTC derivatives at large bank holding companies. We find that the main factors driving the cost comparison are (i) the netting benefits achieved through bilateral and central clearing; (ii) the margin period of risk used to set initial margin and capital requirements; and (iii) the level of CCP guarantee fund requirements. Our results show that the cost comparison does not necessarily favor central clearing and, when it does, the incentive may be driven by questionable differences in CCPs’ default waterfall resources. We also discuss the broader implications of these tradeoffs for OTC derivatives reform.

Does OTC Derivatives Reform Incentivize Central Clearing?

The reform program for the over-the-counter (OTC) derivatives market launched by the G-20 nations in 2009 seeks to reduce systemic risk from OTC derivatives. The reforms require that standardized OTC derivatives be cleared through central counterparties (CCPs), and they set higher capital and margin requirements for non-centrally cleared derivatives. Our objective is to gauge whether the higher capital and margin requirements adopted for bilateral contracts create a cost incentive in favor of central clearing, as intended. We introduce a model of OTC clearing to compare the total capital and collateral costs when banks transact fully bilaterally versus the capital and collateral costs when banks clear fully through CCPs. Our model and its calibration scheme are designed to use data collected by the Federal Reserve System on OTC derivatives at large bank holding companies. We find that the main factors driving the cost comparison are (i) the netting benefits achieved through bilateral and central clearing; (ii) the margin period of risk used to set initial margin and capital requirements; and (iii) the level of CCP guarantee fund requirements. Our results show that the cost comparison does not necessarily favor central clearing and, when it does, the incentive may be driven by questionable differences in CCPs’ default waterfall resources. We also discuss the broader implications of these tradeoffs for OTC derivatives reform.

Wind technologies: Opportunities and barriers to a low carbon shipping industry

The abatement potential of wind technologies on ships is estimated to be around 10–60% by various sources. To date there has been minimal uptake of this promising technology, despite a number of commercially available solutions that have been developed to harness this free and abundant energy source. Several barriers have been referred to in the literature that inhibit uptake of energy efficiency measures in shipping. This paper provides a systematic analysis of the viability of wind technology on ships and the barriers to their implementation, both from the perspective of the technology providers and technology users (ship owner–operators), using the survey and the deliberative workshop method. The data generated from these methods is analysed using the qualitative content analysis method. The results show that whilst there is renewed interest in wind power, there are several common economic barriers that are hindering the mass uptake of wind technologies. Our analysis shows that third party capital is a plausible solution to overcoming the cost of capital, split incentives and information barriers that have contributed to inhibiting the uptake of wind technology in the shipping industry.

Development of immunity following financial incentives for hepatitis B vaccination among people who inject drugs: A randomized controlled trial

BackgroundPeople who inject drugs (PWID) are at risk of hepatitis B virus (HBV) but have low rates of vaccination completion. The provision of modest financial incentives increases vaccination schedule completion, but their association with serological protection has yet to be determined. ObjectiveTo investigate factors associated with vaccine-induced immunity among a sample of PWID randomly allocated to receive AUD$30 cash following receipt of doses two and three (‘incentive condition’) or standard care (‘control condition’) using an accelerated 3-dose (0,7,21 days) HBV vaccination schedule. Study designA randomised controlled trial among PWID attending two inner-city health services and a field site in Sydney, Australia, assessing vaccine-induced immunity measured by hepatitis B surface antibodies (HBsAb≥10mIU/ml) at 12 weeks. The cost of the financial incentives and the provision of the vaccine program are also reported. ResultsJust over three-quarters of participants – 107/139 (77%) – completed the vaccination schedule and 79/139 (57%) were HBsAb≥10mIU/ml at 12 weeks. Vaccine series completion was the only variable significantly associated with vaccine-induced immunity in univariate analysis (62% vs 41%, p<0.035) but was not significant in multivariate analysis. There was no statistically discernible association between group allocation and series completion (62% vs 53%). The mean costs were AUD$150.5, (95% confidence interval [CI]: 142.7–158.3) and AUD$76.9 (95% CI: 72.6–81.3) for the intervention and control groups respectively. ConclusionDespite increasing HBV vaccination completion, provision of financial incentives was not associated with enhanced serological protection. Further research into factors which affect response rates and the optimal vaccination regimen and incentive schemes for this population are needed.

Neural-Network Based Optimal Dynamic Control of Delivering Packets in Selfish Wireless Networks

In this letter, we investigate the dynamic packet delivery through a specific path in selfish wireless networks (SeWNs) with cascaded selfish relay nodes (RN). A dynamic node-selfishness model is designed to formulate the variation of the RN's degree of node-selfishness (DeNS) with both its own resource and the incentive controlled by the source. When the node-selfishness dynamics are unknown, using the neural network (NN), we further identify the node-selfishness model and then approximate the optimal incentives for maximizing the infinite-horizon utility, namely the tradeoff between the path reliability and the incentive cost in the long term. Simulation results demonstrate the effectiveness of the proposed scheme.

Holistic Biomass Transport Model for Sustainable Development of Cellulosic Biofuel

&lt;p&gt;Sustainable development of the cellulosic biofuel sector will require biomass supply strategies that can minimize the cost of cellulosic biomass. While the conversion cost of cellulosic biofuel has come down significantly in the last decade, there has not been as significant change in biomass cost. Several studies have provided optimization models for minimizing biomass cost. However, most of the existing models have focused on a modelling approach to optimize a single component of biomass cost, using an integrated biomass transportation model. While separate studies have provided a model on farmer supply response that includes farmer participation and the incentives offered by biorefineries. However, there is a gap in understanding the linkage between transport cost, farmer participation and farmer incentives on biomass cost. As a result most optimization models available in literature are focused on reducing biomass transport cost. This study shows that a strong linkage exists between biomass transport cost and incentives offered to farmers. A holistic biomass supply model is developed that incorporates an integrated biomass transportation model, as well as the relationship between farmer incentives and farmer participation using data from some recent surveys. The holistic model enables a trade-off between increase in incentives and reduction in transport cost. This will help companies develop sustainable long term supply contracts between biorefineries and farmers. The study shows that biorefineries that focus on minimizing biomass cost through optimization of transport cost alone, without considering its relationships with farmer supply response will incur 15 to 20% higher biomass cost.&lt;/p&gt;

Reputation-Based Incentives for Data Dissemination in Mobile Participatory Sensing Networks

The ever-more-capable smart mobile phone gave birth to a novel sensing paradigm, participatory sensing. In the application environment of mobile participatory sensing networks, mobile equipment is usually weakly connected. Due to uncertainty of connection, mobile nodes sometimes need encounter opportunities to accomplish data communication and transmission. However, the participants’ reluctance would diminish their enthusiasm if there is no incentive mechanism. To address this nontrivial issue, we propose reputation-based incentive schemes to motivate participants to disseminate reliable data in participatory sensing system, named RIDD, while minimizing incentive cost for maintaining sufficient number of reliable participants. When an intended receiver receives the data packet from a participant, the receiver authorizes the participant by an acknowledgment message within an encryption code automatically generated by the data packet, which serves as a proof of successful data delivery. RIDD evaluates participants using reputation degree calculated according to the encryption code, encouraging reliable participants to keep being interested in the participatory service with rewards. We conduct simulations in different scenarios. The results show that RIDD remarkably increases the winning probability of participants who disseminate accurate data and reduces the cost for retaining sufficient number of reliable participants.

Incentive Contract Design for Cooperation and Win-Win of Chinese Government and Enterprise in the View of Ecological Civilization

In the view of ecological civilization, the incentive contract between government and enterprise to cooperate and build ecological economy is built by introducing value preference parameter into the classical principal-agent model. Model equilibrium has been analyzed and a numerical example verifies the validity of conclusion. Research results prove that value preference parameter can effectively coordinate interest relationship between government and enterprise and control incentive cost. Value preference parameter of government, marginal output and risk avoidance attitude of enterprise can influence the change of incentive contract.

The Impact of Policy Measures on Future Power Generation Portfolio and Infrastructure: A Combined Electricity and CCTS Investment and Dispatch Model (ELCO)

This paper presents a general electricity-CO2 (ELCO) modeling framework that is able to simulate interactions of the energy-only market with different forms for national policy measures. We set up a two sector model where players can invest into various types of generation technologies including renewables, nuclear and Carbon Capture, Transport, and Storage (CCTS). For a detailed representation of CCTS we also include industry players (iron and steel as well as cement), and CO2 transport and CO2 storage including the option for CO2 enhanced oil recovery (CO2-EOR). The players maximize their expected profits based on variable, fixed and investment costs as well as the price of electricity, CO2 abatement cost and other incentives, subject to technical and environmental constraints. Demand is inelastic and represented via a selection of type hours. The model framework allows for regional disaggregation and features simplified electricity and CO2 pipeline networks. The model is balanced via a market clearing for the electricity as well as CO2 market. The equilibrium solution is subject to constraints on CO2 emissions and renewable generation share. We apply the model to a case study of the UK Electricity Market Reform to illustrate the mechanisms and potential results attained from the model.

Political accountability and sequential policymaking

We develop a model of political accountability with sequential policymaking. When a bureaucrat's actions are transparent, his overseer faces a political time inconsistency problem—she is tempted to revise her retention rule in the middle of the policymaking process. As a result, the bureaucrat's equilibrium behavior overemphasizes later tasks. If the overseer knows the technology by which policies translate into outcomes, then she can eliminate these distortions using task-specific budget caps. However, if the overseer is uncertain about this technology, such budget caps introduce ex post inefficiency. When uncertainty is sufficiently large and consequential, the overseer prefers an institutional environment with a fungible budget and no transparency. Such an environment allows the overseer to exploit the bureaucrat's expertise, though at the cost of weaker overall incentives.

Anticipating PEV buyers’ acceptance of utility controlled charging

Utility controlled-charging (UCC) of plug-in electric vehicles (PEVs) could potentially align vehicle charging with the availability of intermittent, renewable electricity sources. We investigated the case of a nightly charging program where the electric utility can control home PEV charging. To explore consumer acceptance of this form of UCC, we implemented a web-based survey of new vehicle buyers in Canada (n=1470). The survey assessed interest in PEVs, explained UCC, and elicited openness to UCC through attitudinal questions and a stated choice experiment. We find potential for UCC support among one-half to two-thirds of respondents interested in purchasing a PEV, depending on the scenario. However, some respondents express concerns with privacy and loss of control. To quantify preferences for UCC, we estimated a latent class choice model where respondents chose between different PEV charging programs. The model identified four distinct respondent segments (or classes) that vary in their acceptance of UCC, as well as their valuation of renewable electricity, saving money on their electrical bill, and undergoing charging inconvenience. The overall sample was more sensitive to cost incentives than to renewable incentives, where cost-based UCC programs garnered 63–78% enrollment while renewable-based programs garnered only 49–59% enrollment. Overall, we observe the potential for widespread acceptance of UCC programs among Canadian PEV buyers, but program design and deployment will need to carefully acknowledge the various motivations and concerns of different vehicle buyer segments.