• Proceedings of the Korean Operations and Management Science Society Conference
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• 2004.10a
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• pp.539-553
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• 2004

This paper models and solves contracting schemes for both when quality is perfectly observable and when quality is not perfectly observable in supply chain. When quality is perfectly observable, the first-best optimal solution which is that the marginal utility of procurer obtained from the quantity and quality supplied by suppliers (the price) is equal to the marginal cost to produce the quantity and quality is obtained. However, when quality is not perfectly observable to procurers the optimal solution cannot be the first-best but the second-best where the price is greater than the marginal cost to produce the quantity and quality and social welfare is less than that of the first-best solution.

• Journal of the Korean Operations Research and Management Science Society
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• v.31 no.1
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• pp.25-36
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• 2006

Consider a supply chain in which a vendor supplies a product to a buyer. We assume that the buyer's and vendor's inventory cost structures are different, resulting in differences in inventory order/delivery cycle times. Here, if one party insists on its individually optimal order/delivery quantity, the other party will suffer from mismatches in cycle times. Under this scenario, coordination contracts that make use of either a Net Term/Two parts Term Trade Credit or a Quantity Discount are designed to align individually optimal order Quantities. We compare and analyze the perform ances of these contracts. The focus of the comparison is the ability of contracts to generate a lower cost for the supply chain. We show that a Trade Credit policy can be effectively used to coordinate a supply chain. In many cases it will result in a lower supply chain cost compared to that achieved by using a Quantitative Discount policy.

• KSII Transactions on Internet and Information Systems (TIIS)
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• v.6 no.12
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• pp.3133-3151
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• 2012

The optimal price strategy selection of two bounded rational cognitive mobile virtual network operators (MVNOs) in a duopoly spectrum sharing market is investigated. The bounded rational operators dynamically compete to sell the leased spectrum to secondary users in order to maximize their profits. Meanwhile, the secondary users' heterogeneous preferences to rate and price are taken into consideration. The evolutionary game theory (EGT) is employed to model the dynamic price strategy selection of the MVNOs taking into account the response of the secondary users. The behavior dynamics and the evolutionary stable strategy (ESS) of the operators are derived via replicated dynamics. Furthermore, a reward and punishment mechanism is developed to optimize the performance of the operators. Numerical results show that the proposed evolutionary algorithm is convergent to the ESS, and the incentive mechanism increases the profits of the operators. It may provide some insight about the optimal price strategy selection for MVNOs in the next generation cognitive wireless networks.

• Journal of Labour Economics
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• v.37 no.4
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• pp.89-112
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• 2014

This paper characterizes an optimal combination of grant and income-contingent loans (ICL) from efficiency and equity points of view as a government subsidy program for higher-education. In particular, we show that it is always desirable to introduce ICL for students regardless of their household incomes, and also provide arguments for the superiority of tax-financing system to loans with risk-premium as a financing mechanism of ICL. From policy point of view, this paper suggests a need for the extended coverage of our ICL system, while justifying its current tax-financing system.

• The Korean Journal of Financial Management
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• v.25 no.1
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• pp.177-196
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• 2008

The megatrend of convergence in finance, telecommunication, and service industries is being spread over the whole industry. It has generated various kinds of contractual alliance or joint venture. Our paper builds a theoretical model for the profit sharing between two firms that participate in a joint venture. The model shows how the profit sharing rule affects the incentives of the participants, and, eventually, the efficiency. We derive the first-best solution of the profit sharing, where no incentive distortion exists. Then, we compare the incentive-affecting cases with the first best outcome, and assess the efficiency and the fairness of distribution. Our analysis shows that if we properly design the decision-making structure on transfer price and production quantity, we can reach the socially optimal efficiency.

• The KIPS Transactions:PartC
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• v.19C no.2
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• pp.145-148
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• 2012

In a distributed streaming system using an advanced coding scheme that encodes a video into multiple substreams, the capacity of the system depends on the amount of contribution of participating peers. Thus, an incentive mechanism for peers to contribute voluntarily is needed to increase system capacity. In addition, since peers are not only a provider but also a consumer in the system (i.e. prosumer), the overall capacity of the system must be allocated fairly among the peers while it must be allocated in a way that can maximize the net quality of experience of peers to increase system efficiency. In this paper, we propose a substream allocation method to solve the problems taking an optimization approach. Unlike the other optimization approaches, the proposed method is verified quantitatively in a simulation study that it can use the capacity of video streaming system efficiently while allocating fair amount of substreams among peers because it considers explicitly the prosumer characteristics of peers.

• Management Science and Financial Engineering
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• v.1 no.1
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• pp.1-19
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• 1995

In this paper, we analyze an M / M / 1 queueing system where there are incentive conflicts among customers. Self-interested customers' decisions whether to join the system or not may not necessarily induce a socially optimal congestion level. As a way to alleviate the over-congestion, toll imposition was used in Naor's paper [3]. Instead of using a toll mechanism, we study the usefulness of imperfect information on system state (queue size, for example) as a way to reduce the over-congestion by self-interested customers. The main conclusion of this paper is that by purposefully giving fuzzy or imperfect information on the current queue size we can improve the congestion in the system. This result might look contradictory to rough intuition since perfect information should give better performance than imperfect information. We show how this idea is verified. In deriving this result, we use the concept of Nash equilibrium (pure and mixed strategy) as introduced in game theory. In some real situations, using imperfect information is easier to apply than imposing a toll, and thus the result of this paper has practical implications.

• Management Science and Financial Engineering
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• v.13 no.2
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• pp.117-139
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• 2007

This paper contributes by incorporating works addressing supply chain coordination and investing in setup reduction program. Consider a two-echelon, EOQ-like inventory system consisting of a supplier and a buyer. We assume that both the supplier and the buyer can invest in setup cost reduction programs in order to benefit from small order sizes. However, the costs of investing in setup cost reduction programs are different for the two parties, leading to mismatches in individually optimal setup costs and order cycle times. We propose a supply chain coordination contract that makes use of quantity discount as an incentive transfer scheme for supply chain coordination.

• Journal of Forest and Environmental Science
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• v.32 no.1
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• pp.55-67
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• 2016

This paper investigated policies that drive the sustainable management of Ivorian forest which disappear at an annual rate of 250000 hectares. Based on an inter-temporal model for optimum allocation of forest land to three competing uses, the article found that sustainability depends on the incentive structure, of which forest taxes and fees are a key, though obviously not the sole, component. The study proposed to increase the area fee level by accounting for environmental externalities generated by forest harvesters and farmers. The paper showed that the area fee is a decreasing function of the forest natural rate of regeneration and the reconversion rate of agricultural surfaces. Finally, at the given forest natural rate of regeneration and the reconversion rate of agricultural surfaces, the model argued that the area fee need to be progressive (arithmetic progression) in the context of ecological equilibrium break while it should remain constant in normal situation.

• Proceedings of the Korean Society of Precision Engineering Conference
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• 2006.05a
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• pp.477-478
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• 2006

This paper presents the results of miniaturized micro milling machine tool development for micro precision machining process. Finite element analysis has been performed to know the relationship between design dimensional variables and structural stiffness in terms of static, dynamic, thermal aspects. Design optimization has been performed to optimize the design variables of micro machine tool to minimize the volume, weight and deformation of machine tool structure and to maximize the stiffness in terms of static, dynamic, and thermal characteristics. This study presents the assessment of the technology incentive for the minimization of machine tool in the quantitative context of static, dynamic stiffness, thermal resistance and thus the accuracy implications.