• Journal of Korean Institute of Industrial Engineers
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• v.13 no.1
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• pp.1-10
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• 1987

This paper deals with a single-facility multiproduct lot-size model requiring consideration of setup costs. Each product is demanded at the constant rate per unit time in the next particular period. Due to the limitation of the production capacity, some productions of total demand requirement in that period must be pre-produced. The aim of this project is to determine when and how much of each product to make in order to minimize the total setup costs and inventory carrying-costs of all products. Also this paper contains the further realistic treatment of inventory carrying-costs.

• The Journal of Fisheries Business Administration
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• v.26 no.2
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• pp.133-146
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• 1995

WTO system has just begun and the development for fishing industry is being carried out. The task of National Federation of Fisheries Cooperatives(NFFC ) is not only to support producers' competitive edge, but also to realize the efficiency embodied in the businesses of NFFC itself. Then it can continue to compete other firms and offer the comprehensive services only when it achieves its efficiency. The efficiency of NFFC is the economies of scale and scope. NFFC should achieve its scale and scope economies to be efficient. NFFC needs to expand its size in fish distribution and banking business to have scale economies. Also, the communication and coordination systems among member-supporting, fish distribution, and banking business need to be strengthened to get its scope economies. It is interesting theoretically and in policy making to test the hypotheses that cooperatives are capable of offering the comprehensive services such as distribution, credit, and insurance to the members. It is meaningful to their development for agricultural and small businesses cooperatives as well as fisheries cooperatives to survive the fierce competition under WTO system. National Federation of Agricultural Cooperatives(NFAC) is much greater in business size than NFFC. The estimation and test in the multiproduct cost function of NFAC will show interesting results.

• Journal of the Korean Society for Aviation and Aeronautics
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• v.14 no.4
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• pp.38-47
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• 2006

This study analyzes the expense structure of the air transport industry, based on the cost and income data of 18 major airlines, estimates the economic effectiveness of scale and conducts comparative analysis. As for the method of analysis, Translog cost function and the Fourier flexible function were used. The result showed that big companies had the economy of scale based on the Translog cost function, while the Fourier flexible function led to a estimation that expanding the input is not recommended, for the expansion of scale entails the poor economy of scale. It can be presumed that the economy of scale was estimated according to the U shape of the Translog cost function in the given data. On the other hand, the Fourier flexible cost function approaches the unknown function, as it is a Fourier series, and correctly infers the economy of scale based on the analyzed data. As for the flag carrier's economy of scale, it was inferred that the economy of scale existed by any of two functions. Therefore, the conclusion was that further expanding the scale will not cause any problem.

• Journal of Institute of Control, Robotics and Systems
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• v.12 no.12
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• pp.1163-1168
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• 2006

Manufacturing technology for the production of high value-added fine chemical products is emphasized and getting more attention as the diversified interests of customers and the demand of high quality products are getting bigger and bigger everyday. Thus, the development of advanced batch processes, which is the preferred and most appropriate way of producing these types of products, and the related technologies are becoming more important. Therefore, high-precision batch distillation is one of the important elements in the successful manufacturing of fine chemicals, and the importance of the process operation strategy with quality assurance cannot be overemphasized. Accordingly, proposing a process structure explanation and operation strategy of such processes including batch processes and batch distillation would be of great value. We investigate optimal operation strategy and production planning of multi-purpose plants consisting of batch processes and batch distillation for the manufacturing of fine chemical products. For the short-term scheduling of a sequential multi-purpose batch plant consisting of batch distillation under MPC and UIS policy, we proposed a MILP model based on a priori time slot allocation. Also, we consider that the waste product of being produced on batch distillation is recycled to the batch distillation unit for the saving of raw materials. The developed methodology will be especially useful for the design and optimal operations of multi-purpose and multiproduct plants that is suitable for fine chemical production.

• Journal of Institute of Control, Robotics and Systems
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• v.7 no.10
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• pp.867-873
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• 2001

The purpose of this study is to find analytic solution of determining the optimal capacity (lot-size) of multiproduct acyclic multistage production and inventory system to meet the finished product demand under the constraint of finite intermediate storage. Intermediate storage is a practical way to mitigate the material flow imbalance through the line of supply and demand chain. However, the cost of constructing and operating storage facilities is becoming substantial because of increasing land value, environmental and safety concern. Therefore, reasonable decision-making about the capacity of processes and storage units is an important subject for industries. The industrial solution for this subject is to use the classical economic lot sizing method, EOQ/EPQ(Economic Order Quantity/Economic Production Quantity) model, incorporated with practical experience. But EOQ/EPQ model is not suitable for the chemical plant design with highly interlinked processes and storage units because it is developed based on single product and single stage. This study overcomes the limitation of the classical lot sizing method. The superstructure of the plant consists of the network of serially and/or parallelly interlinked non-continuous processes and storage units. The processes transform a set of feedstock materials into another set of products with constant conversion factors. A novel production and inventory analysis method, PSW(Periodic Square Wave) model, is applied to describe the detail material flows among equipments. The objective function of this study is minimizing the total cost composed of setup and inventory holding cost. The advantage of PSW model comes from the fact that the model provides a set of simple analytic solutions in spite of realistic description of the material flows between processes and storage units. the resulting simple analytic solution can greatly enhance the proper and quick investment decision for the preliminary plant design problem confronted with economic situation.

• Journal of Korean Society of Transportation
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• v.25 no.6
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• pp.141-157
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• 2007

This paper evaluates the effects of privatization and deregulation on the firm-specific efficiency and total factor productivity (TFP) growth in the Korean and Japanese railways. Using a stochastic frontier approach and a generalized translog functional form, the paper specifies the equation system consisting of a multiproduct variable cost function and input share equations which is estimated with Zellner's iterative seemingly unrelated regression and the corrected least squares method. The Korean and Japanese railway firms are assumed to produce three outputs (Shinkansen passenger-kilometers, incumbent railway passenger-kilometers, ton-kilometers of freight) using three input factors (labor, fuel, maintenance and rolling stock). A monetary value of the ways and fixed installations held by the railroad firm is also included as a quasi-fixed input. The empirical results indicate that the average estimate of cost inefficiency is 2.57% for the total sample and on the average, JNR and JR Kyushu are found to be worst efficient while the most efficient railway firm in the sample is JR West. Also the cost efficiency levels of seven JRs have been improved after the reform and privatization of JNR. The findings also indicate that TFP growth of the privately-owned JRs are higher than those of the government-owned KNR and JNR. Three-island JRs and JR Freight have slightly higher TFP growth than Honshu JRs as well. Thus, the results suggest that managerial autonomy and increased competition via deregulation have improved efficiency and TFP growth.

• Journal of Korean Society of Transportation
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• v.19 no.6
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• pp.89-102
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• 2001

Using a multiproduct translog cost function model, this paper examines the existence or absence of scale and scope economies in Seoul's urban bus industry. The Paper then conceptualizes that the bus firm produces three outputs (city, seat and local bus-kilometers) using low input factors(labor, capital, fuel and maintenance). Using 1996 annual observations for 81 Seoul's bus firms, the equation system consisting of a cost function and three input share equations is estimated with the nonlinear iterative Zellner method. The findings show that the cost function corresponding to a non-homothetic production technology with separability between local bus outputs and inputs adequately represents the structure of cost for Seoul's bus firms, and that the demand lot all input factors is quite inelastic with respect to their own price. On the other hand, nearly all firms experience mild overall economies or scale, but rather marked product-specific economies of scale with respect to all the three outputs. In addition, there appear to be substantial economies or scope associated with the joint production of city and seat bus services, while considerable diseconomies of scope associated with that of city and local bus services. These results indicate that the merger of smaller firms into larger firms with a fleet of approximately 200 buses would result in more cost-efficient bus services.

• Journal of Korean Society of Transportation
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• v.22 no.6
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• pp.159-173
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• 2004

Using a generalized translog multiproduct cost function model, this paper examines economies of scale and scope in the vertically-integrated Korean railway industry. The paper then conceptualizes that the Korea National Railroad (KNR) produces four outputs (passenger-kilometers, ton-kilometers of freight, average length of passenger trips, and average length of freight haul) using three input factors(labor, fuel and maintenance, and rolling stock and capital). Using time series data collected from the KNR's annual records for the years from 1977 to 2002, the simultaneous equation system consisting of a cost function and two input share equatins is estimated with the Zellner's iterative seemingly unrelated regression. The findings show that the cost function corresponding to a non-Cobb-Douglas, non-homothetic, and non-homogeneous production technology adequately represents the KNR's cost structure. On the other hand, the Korean railway industry experiences sizeable overall scale economies, which result from substantial product-specific scale economies associated with passenger-kilometers and freight ton-kilometers and from scope economies associated with their joint production. In addition, the magnitude of economies of scope is influenced largely by the ratio of passenger trips, and has increased over time as the former has increased while the latter has decreased.

• The Journal of the Convergence on Culture Technology
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• v.8 no.3
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• pp.405-413
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• 2022

Since the COVID-19 outbreak, the active utilization of new health care service utilizing the ICT technology and data science such as telemedicine, smart hospital, AI dignosis has been increasingly found. In this study we examined the business model of Amazon healthcare which leads disruptive innovation in U.S. health care industry with the introduction of hybrid model of telemedicin, in-person care and customer-centric online drug delivery, home-use diagnostic kit, characterized by the integrated model combining medical care, drug delivery and the use of diagnostic kit. We showed using the multiproduct competition model that the synergy effect between the Amazon's original business areas and the healthcare business area causes the active market penetration and the increase in the customer value from utilization of the Amazon care. Using Hotelling's spatial competition model, we also showed that the competition in the health care market can be greater when consumer's choice of health care providers are available in telemedicine platform. In the long, run the issue of competition being weakened due to the exit of less competent healthcare providers may arise, to which the policymakers in the charge of fair competition in health care industry should pay attention.

• Journal of Korean Society of Transportation
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• v.24 no.2 s.88
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• pp.65-78
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• 2006

This paper investigates the cost structure ot the Korea and Japan railroad industry with respect to density, scale and scope economies as well as productivity growth rate using a generalized trans)og multiproduct cost function model. The paper then assumes that the Korea and Japan railway companies pi·educe three outputs (incumbent railway passenger-kilometers. Shinkansen passenger-kilometers, ton-kilometers of freight) using four input factors (labor, fuel, maintenance, rolling stock and capital). The specified cost function includes foul other independent variables: track lengths to reflect network effects, two dummies to reflect nation and ownership effects, and time trend as a proxy for technical change. The simultaneous equation system consisting of a cost function and three input share equations is estimated with the Zellner's iterative seemingly unrelated regression. The unbalanced panel data used in the paper, a total of 154 observations. are collected from the annual records of the Korea National Railroad (KNR) for the yews $1977{\sim}2003$, Japan National Railways (JNR) for the years $1977{\sim}1984$. seven Japan Railways (JR's) for the years $1987{\sim}2003$. The findings show that the Korean and Japanese railways exhibit product-specific and overall economies of density but product-specific diseconomies of scale with respect to incumbent railway passenger-kilometers, Shinkansen-kilometers and ton-kilometers. However, the railways experience mild overall economies of scale which result from economies of scope associated with the joint production of incumbent railway/Shinkansen and feight, freight/incumbent railway and Shinkansen except Shinkansen/incumbent railway and freight. In addition, the economies of density and scale in the KNR, JR east, JR central, and JR west companies at the point of the years $1990{\sim}2003$ average is generally analogous to the above results at the point of sample average. There also appear to be economies of ssope associated with the joint Production of the incumbent railway and Shinkansen in JR central but diseconomies of scope in JR East and JR West. The findings also indicate that the productivity growth rate of the privately-owned JR's is larger than that of the government-owned KNR.