1,721,086 research outputs found
A probabilistic model for the estimation of declining discount rate
No full textIn the Cost-Benefit Analysis (CBA) the traditional discount procedures determine a significant contraction of the financial terms that are furthest over time. This contraction is not acceptable in the economic evaluation of public projects with inter-generational effects, since it causes little appreciation of the net benefits for the future generations. The use of time-Declining Discount Rate (DDR) represents a possible solution to the problem. Following a critical analysis of the main methodologies that the theory describes, the study proposes an innovative model for the estimation of DDR. The model, based on principles widely recognized in literature, uses probabilistic laws and returns a simple-use forecasting algorithm, as uses economic and demographic data easy to find. The implementation for the Italian economy makes it possible to validate the model and makes it clear how significantly the results of the CBA can vary if a declining discount rate instead of a time-invariant rate is chosen. The important political repercussions on the entire allocation process of public resources demonstrate the effectiveness of hyperbolic discount procedures, suggesting to distinguish between constant discount rates for the evaluation of projects with intra-generational effects and time-declining discount rates for interventions with inter-generational implications
Sustainability indicators for the economic evaluation of tourism investments on islands
Full text linkThe sustainable tourism development is often a key element for the enhancement of island states. The fragility and the environmental, social and economic vulnerability that characterize these territories make the need to integrate the multiple aspects of sustainability into the decision-making processes concerning the definition of plans and programs of investment in the tourism sector increasingly urgent. Thus, the aim of the work is to build a dataset of sustainability indicators classified and weighed according to the subsequent characterization of a multi-criteria evaluation model. This dataset is obtained by defining an analysis procedure aimed at: selecting scientifically valid indicators, readily available by the analysts and easy to interpret by stakeholders; weighing the indicators themselves based on criteria shared in the literature; taking into account the uniqueness of the territorial reference system. The evaluation protocol proposed is substantiated in the subsequent steps of selection, classification, weighting and ranking of sustainability indicators for the analysis of tourism projects on the island. Innovative elements essentially concern weighting operation. In fact, the weight of each indicator is a function of several evaluation criteria and is estimated by using both statistical analysis methods and analytic hierarchy processes. The output of the study, consisting of the dataset of sustainability indicators, is a prerequisite for the subsequent characterization of a multi-criteria evaluation model able to select investment projects that balance the environmental, economic and social specificities of the island. This can determine greater effectiveness in the allocation processes of both public and private resources
The role of discounting in energy policy investments
No full textFor informing future energy policy decisions, it is essential to choose the correct social discount rate (SDR) for ex-ante economic evaluations. Generally, costs and benefits—both economic and environmental—are weighted through a single constant discount rate. This leads to excessive discounting of the present value of cash flows progressively more distant over time. Evaluating energy projects through constant discount rates would mean underestimating their environmental externalities. This study intends to characterize environmental–economic discounting models cali-brated for energy investments, distinguishing between intra-and inter-generational projects. In both cases, the idea is to use two discounting rates: an economic rate to assess financial components and an ecological rate to weight environmental effects. For intra-generational projects, the dual discount rates are assumed to be constant over time. For inter-generational projects, the model is time-declining to give greater weight to environmental damages and benefits in the long-term. Our discounting approaches are based on Ramsey’s growth model and Gollier’s ecological discounting model; the latter is expressed as a function of an index capable of describing the performance of a country’s energy systems. With regards to the models we propose, the novelty lies in the calibration of the “environmental quality” parameter. Regarding the model for long-term projects, another innovation concerns the analysis of risk components linked to economic variables; the growth rate of consumption is modelled as a stochastic variable. The defined models were implemented to deter-mine discount rates for both Italy and China. In both cases, the estimated discount rates are lower than those suggested by governments. This means that the use of dual discounting approaches can guide policymakers towards sustainable investment in line with UN climate neutrality objectives
Alarp criteria to estimate acceptability and tolerability thresholds of the investment risk
No full textAssessing the riskiness of investments in civil works is an integral part of the decision-making process. The main limitation is the absence, both in the regulatory landscape and in the literature of the sector, of threshold values that can guide the analyst in expressing an assessment on the acceptance of the investment risk. The aim of the paper is to define a risk management model that overcomes this gap by introducing acceptability and tolerability thresholds for project risk. The idea is to jointly use: (i) the As Low As Reasonably Practicable (ALARP) logic, from which the concepts threshold of acceptability and tolerability of risk derive, for the first time applied to assess the project risk in the civil field; (ii) the Capital Asset Pricing Model (CAPM) and statistical methods to define an innovative methodology for estimating the aforementioned threshold values. According to the proposed approach, these risk limit values can be specified according to both the investment sector and the socio‐economic context of the project. The implementation of the methodology in the civil company sector in Europe allows to validate the described model. The elaborations show that the financial performance of the project is widely acceptable if the Expected Internal Rate of Return is greater than 7.8%; unacceptable if the expected rate of return is less than 5.6%; and tolerable as an ALARP if the expected rate is between 5.6% and 7.8%. The estimated acceptability and tolerability thresholds can provide the economic operator with a more immediate and consistent evaluation of the triangular balance of risks, costs, and benefits. This allows the decision‐making process to become more rational and transparent
An Economic Model to Assess the Long-Term Implications for Investments Aimed at Urban Sustainability
No full textThe long “life” of investments aimed at the sustainable development of the urban and built environment generates benefits, costs, and risks over a longer period than that of the generations that evaluate them. In this regard, reference should be made to environmental externalities, such as greenhouse gas emissions, which must be taken into account in the studies. This requires the use of logic that allows attributing the right weight to inter-generational effects in economic analyses. For this reason, the paper focuses on the choice of the Social Discount Rate (SDR) to be used in Cost-Benefit Analysis (CBA) of projects with long-term implications. In fact, social discounting is generally carried out using time-constant discount rates. Nevertheless, the resulting excessive contraction for Cash Flows (CFs) progressively more distant in time, leads to employing time-declining discount rates. Thus, the aim of this work is to propose an innovative model for the estimation of Declining Discount Rates (DDRs) based on probabilistic logic algorithms. The model, which is easy to implement in practice but always anchored to the theoretical principles of the reference literature, can become a determining tool for decision-making purposes since it leads to a good dimensioning of the long-term effects that sustainable urban development projects determine
Long-Term Effects Evaluation for Investments in the Energy and Water Sectors
No full textThe rapid economic and demographic growth of recent decades, together with the rising living standards and the unplanned urbanization process, have caused a disproportionate use of water and energy resources. This requires methodologies to support the decision-making processes capable of establishing sustainable actions and strategies. Therefore, in the Cost–Benefit Analysis (CBA) of investment projects, it is of increasing interest to also consider the extra-financial effects that are generated. For such effects, conventional discount procedures are often inadequate, especially when intergenerational environmental effects need to be assessed. This paper proposed a model that differently discounts the economic effects and environmental impacts that projects in the water and energy sectors determine. The model outlines a declining structure for both of the economic discount rate and the environmental discount rate. The main novelty of the model lies in the introduction of environmental quality into the logical-mathematical estimation scheme. Environmental quality is expressed according to the indicators that contribute to the Environmental Performance Index (EPI). The use of dual and declining discounting procedures makes it possible to give greater weight to environmental externalities, orienting guiding the decision-maker towards more sustainable investment choices
HyBloSE: Hybrid blockchain for secure-by-design smart environments
No full textAlthough smart environments are a key component of the Internet of Things (IoT), it is also clear that billions connected doors, washing machines, ovens and others will ultimately raise security and privacy concerns. Early work in this area, as well as most of commercial solutions, has adopted a centralized client/server approach, neglecting the multitude of risks that are induced by an unfair control of the server side. This has made the adoption of a decentralized and trust-less framework quintessential to guarantee devices security. Nevertheless, decentralized proposals are hardly applicable due to costs, slowness and privacy issues. In this paper, we make the use of blockchain practical for smart environments by designing HyBloSE, a secure-by-design and lightweight blockchain-based framework, able to run on low-power devices without additional hardware. HyBloSE is built by using Delegated Proof of Authority and a Moving Window Blockchain. We evaluate HyBloSE through a network emulator and real experiments with different Raspberry Pi platforms. Results show that HyBloSE guarantees a higher security level in terms of resiliency to internal and external attacks compared to centralized solutions, with overhead below 0.38s per operation and less than $4 per month for unlimited operations. Furthermore, we show how Proof of Authority is more adapt then Proof of Work in IoT private scenarios
SIDE: Self drIving DronEs embrace uncertainty
No full textAerial drones are increasingly used to perform monitoring tasks in a large number of applications. Current solutions to trajectory planning rely on perfect knowledge of ongoing events requiring inspection. Nevertheless, in many scenarios the events' time and position can only be estimated with some uncertainty. Unlike previous work, we consider critical scenarios where a squad of drones is required to autonomously inspect an area of interest under uncertainty of time and location of target events. The main goal of the squad is to ensure maximum coverage of event monitoring with minimum average inspection delay. With no initial knowledge, the drones share their local observations of the environment and apply the Parzen-Rosenblatt approach to manage a dynamic probabilistic map of ongoing events. This map is integrated into a virtual force approach for a joint solution to distributed dynamic trajectory planning and collision avoidance. Through extensive simulations and real-field experiments, we compare our proposal against AC-GAP, a state-of-art solution for UAVs, and Sweep, a sweep-based algorithm for multiple robots. We show that our proposal discovers new events 30-40% faster than the other algorithms, and outperforms them in terms of percentage of visited events and inspection delay, under a wide variety of scenarios
Insights in Urban Resource Management: A Comprehensive Understanding of Unexplored Patterns
Full text linkIn the last few decades, the rapid urbanisation process has led to an exponential growth of resource use, making increasingly difficult to ensure the principles of sustainability within urban systems. Similar to living organisms, cities have always required resources and energy to survive. However, technological development and population growth have consequently led to increasing urban inflows and outflows, in so deeply altering the relations of cities with the environment as a source and a sink. Examples include the extraction of minerals for built environment and industrial processes providing manufactured goods; the conversion of fossil energy into electricity for buildings and fuel for vehicles; the use of natural resources (e.g., land or water) to support urban expansion activities. In a planet with limited resources, the challenge should not be to find new resources but to improve the way we use them and the lifestyles that they support, or in other words, to plan strategies to generate more value and higher quality of life with fewer inputs. It is well-known that cities depend on imports of external resources; however, they also benefit from internal resources and ecosystem services. Based on this framework, an urgent effort is needed to explore crucial urban issues that have not yet been adequately investigated. A strategic resource management is needed to actually move towards sustainable cities. In particular, a special focus should be placed on: (i) to monitor and properly manage the city's resources and energy systems within the metaphor of “urban metabolism;” (ii) to define innovative approaches, actions and strategies that ensure the sustainable management of non-renewable urban resources; (iii) to protect and restore urban ecosystem services as valuable renewable resources, and finally (iv) to envisage participatory governance processes for the appropriate allocation of resources to the common well-being
SULLA DIPENDENZA DEL PREZZO DEGLI IMMOBILI RESIDENZIALI DAI LIVELLI DI ACCESSIBILITÀ A SERVIZI E INFRASTRUTTURE DI TRASPORTO (On the Dependence of Residential Property Prices on Levels of Accessibility to Services and Transport Infrastructure)
No full textIntrinsic characteristics and urban facilities significantly influence residential property prices. However, among the effects of city facilities, those related to accessibility to the urban system services and activities have not yet been sufficiently investigated and their spatial heterogeneity is often overlooked. The aim of the paper is to define a methodology to analyse the impact of accessibility to services and infrastructures on property values. It is a three-step methodology: (i) characterisation of the price function; (ii) verifying the goodness of the model; (iii) autocorrelation analysis and implementation of spatial econometric models. A new element of this research is the construction of a panel of input variables useful for setting the price function. In fact, in addition to intrinsic characteristics and zonal characteristics, local accessibility indicators and systemwide accessibility indicators, usually not included in evaluations, are introduced. In addition, the last step of the model demonstrates the necessity of implementing spatial econometric models in cases where the levels of spatial heterogeneity are not negligible. The implementation of the model to real case studies will allow to quantify the impact of local and systemwide accessibility on residential property values
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