Does Income Inequality Derive the Separatist Terrorism in Turkey?

Separatist terrorism has been a severe problem for Turkey since the mid-1980s. The conventional wisdom contends that economic deprivation in southeastern Turkey is the fundamental reason for the long-running battle against the Kurdish rebels. Considering that there is limited empirical literature on the roots of terrorism in Turkey, yielding conflicting results about the claim that the main cause of terrorism is deprived economic conditions, this study aims to answer whether there is a causal relationship between income inequality and separatist terrorism in Turkey. To this end, the Global Terrorism Data Base for the period of 1973–2006, two Theil indices of pay inequality as proxy for income inequality, and the vector autoregression and Autoregressive Moving Average (ARMA) methods are utilized. The results support the early findings that income inequality, a particular focus in this paper and an essential indicator of economic deprivation, is not a main cause of escalation of separatist terrorism in Turkey.     

Collaborative procurement among competing buyers

Collaborative procurement emerged as one of the many initiatives for achieving improved inter‐firm coordination and collaboration. In this article, we adopt a game‐theoretical approach to study the interaction between two firms who procure jointly, but produce independently and remain competitors in a product market characterized by price‐sensitive demand. We study the underlying economics behind collaborative procurement, examine the effects of collaboration on buyer and supplier profitability, and derive conditions under which collaboration is beneficial to each participant. We find that a necessary and sufficient condition for a buyer to collaborate is to increase its sales. We identify the conditions that lead equal size buyers (i.e., consortia consisting of only large buyers or only small buyers) versus different size buyers to collaborate. We also determine the conditions that make collaboration profitable for the supplier, and show that rather than selling a large quantity to a single buyer, the supplier prefers to sell to multiple buyers in smaller quantities. © 2008 Wiley Periodicals, Inc. Naval Research Logistics, 2008     

Book review

This paper investigates the economic roots of separatist terrorism in Turkey. The political conventional wisdom is that poverty in highly Kurdish‐populated, south‐eastern Turkey is one of the most important causes of separatist terrorism and Turkish–Kurdish conflict in Turkey. Therefore, many economic policies have been implemented to improve the economic conditions in the south‐eastern part of the country. Using the Global Terrorism Database and Vector Autoregression (VAR) methodology, I find that there is no causal relationship between economic conditions in south‐eastern Turkey and separatist terrorism. Therefore policy‐makers should be cautious in using economic measures to prevent separatist terrorism in Turkey.     

The effects of customer rebates and retailer incentives on a manufacturer's profits and sales

In some industries such as automotive, production costs are largely fixed and therefore maximizing revenue is the main objective. Manufacturers use promotions directed to the end customers and/or retailers in their distribution channels to increase sales and market share. We study a game theoretical model to examine the impact of “retailer incentive” and “customer rebate” promotions on the manufacturer's pricing and the retailer's ordering/sales decisions. The main tradeoff is that customer rebates are given to every customer, while the use of retailer incentives is controlled by the retailer. We consider several models with different demand characteristics and information asymmetry between the manufacturer and a price discriminating retailer, and we determine which promotion would benefit the manufacturer under which market conditions. When demand is deterministic, we find that retailer incentives increase the manufacturer's profits (and sales) while customer rebates do not unless they lead to market expansion. When the uncertainty in demand (“market potential”) is high, a customer rebate can be more profitable than the retailer incentive for the manufacturer. With numerical examples, we provide additional insights on the profit gains by the right choice of promotion.© 2009 Wiley Periodicals, Inc. Naval Research Logistics, 2010     

Optimal job splitting on a multi‐slot machine with applications in the printing industry

In this article, we define a scheduling/packing problem called the Job Splitting Problem, motivated by the practices in the printing industry. There are n types of items to be produced on an m‐slot machine. A particular assignment of the types to the slots is called a “run” configuration and requires a setup cost. Once a run begins, the production continues according to that configuration and the “length” of the run represents the quantity produced in each slot during that run. For each unit of production in excess of demand, there is a waste cost. Our goal is to construct a production plan, i.e., a set of runs, such that the total setup and waste cost is minimized. We show that the problem is strongly NP‐hard and propose two integer programming formulations, several preprocessing steps, and two heuristics. We also provide a worst‐case bound for one of the heuristics. Extensive tests on real‐world and randomly generated instances show that the heuristics are both fast and effective, finding near‐optimal solutions. © 2010 Wiley Periodicals, Inc. Naval Research Logistics, 2010