In contrast to the overlapping-generations model, it is allowable to discount the future utility in a dynasty model without the ethical difficulty related to intergenerational conflicts. Much precedent research uses R...In contrast to the overlapping-generations model, it is allowable to discount the future utility in a dynasty model without the ethical difficulty related to intergenerational conflicts. Much precedent research uses Ramsey-type optimal growth theory in order to estimate the social discount rate. However, one must note that almost all the formulations neglect the existence of negative intertemporal externalities. This problem is vital when one analyzes the global warming problem mainly caused by the excess concentration of carbon dioxide (CO<sub>2</sub>). This is because an adjoining effect of capital accumulation exists besides the improvement of product capacity, which is reflected in the rate of interest (or equivalently, the marginal productivity of capital). That is, one cannot neglect a negative externality to the future productivity that originates from the excess emissions of CO<sub>2</sub>. Accordingly, following the optimal growth theory, the effective social discount rate should be heightened by a proportional carbon tax to suppress future excess consumption/ emissions than in the case of the existing analyses, which exclude such an intertemporal external diseconomy.展开更多
The freemium pricing model has become mainstream in the software industry.A large user base can induce positive network effects while expanding security risks associated with unpatched users.This study explores a two-...The freemium pricing model has become mainstream in the software industry.A large user base can induce positive network effects while expanding security risks associated with unpatched users.This study explores a two-stage decision problem faced by software vendors that involves a freemium versioning strategy and a subsequent security-patching strategy when taking both the positive network externality and negative security externality into consideration.It is noteworthy that a joint effect of the two externalities on the vendor’s management decisions exists.First,we analytically derive three patching strategies for the vendor:PS_(1)(rebates all users),PS_(2)(rebates only freeware users),and PS_(3)(rebates no users).Our results indicate that,if the strength of the positive network externality is relatively low,the optimal security-patching strategy will be significantly affected by the negative security externality.Specifically,when the intensity of the negative security externality is low,the vendor’s optimal patching strategy will be PS_(1).However,with the increase in the negative security externality,the optimal patching strategy changes to PS_(2) and then to PS_(3),whereas the strategy spaces of PS_(1) and PS_(2) decrease in the positive network externality to zero.Nevertheless,if the strength of the positive network externality is relatively high,the vendor is better off selecting PS_(1) when the negative security externality is low.However,when the negative security externality is high,PS_(3) is optimal.Furthermore,based on optimal patching strategies,we reveal the optimal conditions required for the vendor to adopt the freemium model compared with commercial only.Of interest,we find that the vendor adopting the freemium version is also influenced by the interaction of the two externalities.Finally,through numerical experiments,we find that the vendor and social planner’s interests can be aligned under certain conditions.However,this is not always the case.展开更多
文摘In contrast to the overlapping-generations model, it is allowable to discount the future utility in a dynasty model without the ethical difficulty related to intergenerational conflicts. Much precedent research uses Ramsey-type optimal growth theory in order to estimate the social discount rate. However, one must note that almost all the formulations neglect the existence of negative intertemporal externalities. This problem is vital when one analyzes the global warming problem mainly caused by the excess concentration of carbon dioxide (CO<sub>2</sub>). This is because an adjoining effect of capital accumulation exists besides the improvement of product capacity, which is reflected in the rate of interest (or equivalently, the marginal productivity of capital). That is, one cannot neglect a negative externality to the future productivity that originates from the excess emissions of CO<sub>2</sub>. Accordingly, following the optimal growth theory, the effective social discount rate should be heightened by a proportional carbon tax to suppress future excess consumption/ emissions than in the case of the existing analyses, which exclude such an intertemporal external diseconomy.
文摘The freemium pricing model has become mainstream in the software industry.A large user base can induce positive network effects while expanding security risks associated with unpatched users.This study explores a two-stage decision problem faced by software vendors that involves a freemium versioning strategy and a subsequent security-patching strategy when taking both the positive network externality and negative security externality into consideration.It is noteworthy that a joint effect of the two externalities on the vendor’s management decisions exists.First,we analytically derive three patching strategies for the vendor:PS_(1)(rebates all users),PS_(2)(rebates only freeware users),and PS_(3)(rebates no users).Our results indicate that,if the strength of the positive network externality is relatively low,the optimal security-patching strategy will be significantly affected by the negative security externality.Specifically,when the intensity of the negative security externality is low,the vendor’s optimal patching strategy will be PS_(1).However,with the increase in the negative security externality,the optimal patching strategy changes to PS_(2) and then to PS_(3),whereas the strategy spaces of PS_(1) and PS_(2) decrease in the positive network externality to zero.Nevertheless,if the strength of the positive network externality is relatively high,the vendor is better off selecting PS_(1) when the negative security externality is low.However,when the negative security externality is high,PS_(3) is optimal.Furthermore,based on optimal patching strategies,we reveal the optimal conditions required for the vendor to adopt the freemium model compared with commercial only.Of interest,we find that the vendor adopting the freemium version is also influenced by the interaction of the two externalities.Finally,through numerical experiments,we find that the vendor and social planner’s interests can be aligned under certain conditions.However,this is not always the case.
