Economic Efficiency Objectives Research Articles

Le changement technique et les «Agency costs» : Un dilemne croissant pour le planificateur central soviétique

Technological Change and Agency Costs. A Growing Dilemma for Soviet Central Planners. Growth rates in the Soviet economy have slowed significantly in recent years. It appears that input growth rates cannot be increased substantially, so the burden of reversing the retardation falls, in large measure, on technological change. Yet the Soviet economic system is notoriously weak in generating and diffusing improved technology. These weaknesses are well known and yet they persist in the system. The central argument of this paper is that these systematic weaknesses are not necessarily a reflection of irrationality or ignorance, but rather reflect the results of an implicit trade-off between the objectives of economic efficiency and control of the system. Taking off from Zaleski's conclusion that the purpose of the planning system is to manage, the papers's analysis applies recent developments in the theory of agency costs to show why apparently illogical or irrational characteristics persist in the system. For example, the policy of permanent prices, the proclivity for long production runs of standardized products, and the reluctance to make allowances for obsolescence, among other things, can be understood in these terms. The basic analysis is then applied to characteristics of the system that appear to slow technological change. A main conclusion is that the existing planning system can be better understood as an instrument that is used to promote the ends of the leadership. To be effective, the system must be controlled, and it is the effort to maintain control that results in some of its apparently anomalous characteristics. In trying to understand the system or reform attempt, it is important to evaluate how well the system serves the ends of the leaders, rather than whether it conforms to neoclassical economic welfare criteria.

Linear decision rule in reservoir design and management: 6. Incorporation of economic efficiency benefits and hydroelectric energy generation

The linear decision rule (LDR) model introduced by ReVelle et al. (1969) is extended to include multiple uses of a reservoir system with an objective of economic efficiency. A method of incorporating hydroelectric energy production within the LDR model is presented and the water supply uses of the reservoir system are evaluated and reformulated. The extended LDR model is shown to be well within the limits of computational feasibility for large (10 or more facilities) reservoir systems with conflicting uses and an objective of maximizing net economic efficiency benefits.

A Model for Managing Reservoir Water Releases

AbstractTwo surface reservoirs in California's Salinas Basin are used to increase recharge of valley aquifers. Under the assumptions of zero price elasticity of demand for groundwater, unregulated groundwater withdrawals, and the objective of economic efficiency, the management criterion is to maximize the present value of expected aquifer recharge where the value of a unit of recharge is the associated reduction in pumping costs. A cyclical Markov dynamic programming management model is developed; optimal strategies are obtained. Results indicate the optimal strategy is relatively stable within the realistic range of alternative groundwater demand growth rates. The marginal value function for reservoir capacity is obtained by parametric analysis.

Environmental Aspects of River Basin Planning

Current methods, substance, and administration of river basin planning in the United States must be changed substantially to accommodate the increasing national concern for problems of environmental quality. Modifications will be required in planning theory; improvement or environmental quality should be adopted as a major national objective, along with currently accepted objectives of economic efficiency and income distribution. Significant changes are also needed in methods of computing benefits, cost and production functions, and in the planning process and techniques. Systems analysis methods must incorporate many environmental quality parameters and alternative development and management measures. Planning for river basins and for metropolitan areas must be integrated. Important changes required in water-resources policy, organization and administration are discussed. Extensive research and experimentation on new methods and approaches are required by research centers and public agencies concerned with water resources and environmental quality problems.

Some Educational and Cultural Problems and Needs of Negro Children and Youth

What are the educational problems and needs of Negro youth? Basically the needs of Negro children are the same as those of all children and youth. However, because of the marginal status of these young people, there are additional needs which must be met if they are to have an equal opportunity to realize the general purposes of society and education. What these general purposes are have been stated by different persons and groups over the centuries but consideration will be given here to the pronouncements of the Educational Policies Commission' of the National Education Association in 1938 because of the prestige of the educational leaders who make up this body. After reviewing previous statements of general aims of education in America, this group presented four great groups of goals: 1. The Objectives of SelfRealization; 2. The Objectives of Human Relationship; 3. The Objectives of Economic Efficiency; and, 4. The Objectives of Civic Responsibility.