Cyberpower in Strategic Affairs: Neither Unthinkable nor Blessed

Abstract

This article explores the effect of connectivity on strategic affairs. It argues that the effect on war's character is potentially, although not yet shown in practice, considerably large. Its effect upon the distribution of power among states in the international system is small, contrary to the claims of ‘cyberwar’ alarmists. All told, however, its effect upon strategic affairs is complex. On the one hand, it represents a significant advance in the ‘complexification’ of state strategies, understood in the sense of the production of intended effects. On the other hand, strategists today – still predominantly concerned with the conflicts and confrontations of states and organised military power – are generally missing the power which non-traditional strategic actors, better adapted to the network flows of the information age, are beginning to deploy. These new forms of organization and coercion will challenge the status quo.     

To wait or not to wait: Optimal ordering under lead time uncertainty and forecast updating

There has been a dramatic increase over the past decade in the number of firms that source finished product from overseas. Although this has reduced procurement costs, it has increased supply risk; procurement lead times are longer and are often unreliable. In deciding when and how much to order, firms must consider the lead time risk and the demand risk, i.e., the accuracy of their demand forecast. To improve the accuracy of its demand forecast, a firm may update its forecast as the selling season approaches. In this article we consider both forecast updating and lead time uncertainty. We characterize the firm's optimal procurement policy, and we prove that, with multiplicative forecast revisions, the firm's optimal procurement time is independent of the demand forecast evolution but that the optimal procurement quantity is not. This leads to a number of important managerial insights into the firm's planning process. We show that the firm becomes less sensitive to lead time variability as the forecast updating process becomes more efficient. Interestingly, a forecast‐updating firm might procure earlier than a firm with no forecast updating. © 2009 Wiley Periodicals, Inc. Naval Research Logistics, 2009     

A primal-dual cutting-plane algorithm for all-integer programming

The integer programming literature contains many algorithms for solving all-integer programming problems but, in general, existing algorithms are less than satisfactory even in solving problems of modest size. In this paper we present a new technique for solving the all-integer, integer programming problem. This algorithm is a hybrid (i.e., primal-dual) cutting-plane method which alternates between a primal-feasible stage related to Young's simplified primal algorithm, and a dual-infeasible stage related to Gomory's dual all-integer algorithm. We present the results of computational testing.     

French Nuclear Diplomacy

“French nuclear diplomacy” is the French government's use of civilian nuclear cooperation agreements (NCAs) to advance specific commercial and strategic interests. During the heart of the so-called nuclear renaissance, the Élysée Palace aggressively peddled France's nuclear expertise and technology abroad, signing over a dozen new NCAs in an effort to bring in business for the French industry, forge diplomatic relationships, and promote global nonproliferation norms. Several years later, however, the outcomes of France's aggressive global nuclear power push appear nominal at best. This article explores the mixed results of this nuclear campaign, and through three case studies, illustrates how many of France's commercial and political disappointments stem from unrealistic expectations and the disorganization of the French nuclear complex.     

Dynamic pricing under first order Markovian competition

We evaluate the effect of competition on prices, profits, and consumers' surplus in multiperiod, finite horizon, dynamic pricing settings. In our base model, a single myopic consumer visits two competing retailers, who offer identical goods, in a (first order Markovian) probabilistic fashion—if the posted price exceeds the consumer's valuation for the good, he returns to the same store in the following period with a certain probability. We find that even a small reduction in the return probability from one—which corresponds to the monopoly case at which prices decline linearly—is sufficient to revert the price decline from a linear into an exponential shape. Each retailer's profit is particularly sensitive to changes in his return probability when it is relatively high, and is maximized under complete loyalty behavior (i.e., return probability is one). On the other hand, consumer surplus is maximized under complete switching behavior (i.e., return probability is zero). In the presence of many similar consumers, the insights remain valid. We further focus on the extreme scenario where all consumers follow a complete switching behavior, to derive sharp bounds, and also consider the instance where, in this setting, myopic consumers are replaced with strategic consumers. © 2011 Wiley Periodicals, Inc. Naval Research Logistics, 2011     

Robust ship scheduling with multiple time windows

We present a ship scheduling problem concerned with the pickup and delivery of bulk cargoes within given time windows. As the ports are closed for service at night and during weekends, the wide time windows can be regarded as multiple time windows. Another issue is that the loading/discharging times of cargoes may take several days. This means that a ship will stay idle much of the time in port, and the total time at port will depend on the ship's arrival time. Ship scheduling is associated with uncertainty due to bad weather at sea and unpredictable service times in ports. Our objective is to make robust schedules that are less likely to result in ships staying idle in ports during the weekend, and impose penalty costs for arrivals at risky times (i.e., close to weekends). A set partitioning approach is proposed to solve the problem. The columns correspond to feasible ship schedules that are found a priori. They are generated taking the uncertainty and multiple time windows into account. The computational results show that we can increase the robustness of the schedules at the sacrifice of increased transportation costs. © 2002 Wiley Periodicals, Inc. Naval Research Logistics 49: 611–625, 2002; Published online in Wiley InterScience (www.interscience.wiley.com). DOI 10.1002/nav.10033     

Currency Warfare and Just War: The Ethics of Targeting Currencies in War

ABSTRACT

Is Currency Warfare defined as, the use of monetary or military force directed against an enemy’s monetary power as part of a military campaign, a just way to fight a war? This article explores the ethics of waging currency warfare against the Just War Tradition’s principles of jus in bello (just conduct in war) and its criteria of discrimination and proportionality. The central argument is that currency warfare is inherently indiscriminate but may be proportionate when policy makers consider the nature of the threat confronted and the targeted currency's level of internationalization, that is, to what degree it is used in foreign transactions or used as a foreign currency reserve. I evaluate this argument against historical cases during the Second World War (1939–1945), the Gulf War (1990–1991), subsequent operations against Saddam Hussein in the early 1990s, and the ongoing campaign against ISIS.     

Acceptance sampling,imperfect production,and the optimality of zero defects

Acceptance sampling is often used to monitor the quality of raw materials and components when product testing is destructive, time-consuming, or expensive. In this paper we consider the effect of a buyer-imposed acceptance sampling policy on the optimal batch size and optimal quality level delivered by an expected cost minimizing supplier. We define quality as the supplier's process capability, i.e., the probability that a unit conforms to all product specifications, and we assume that unit cost is an increasing function of the quality level. We also assume that the supplier faces a known and constant “pass-through” cost, i.e., a fixed cost per defective unit passed on to the buyer. We show that the acceptance sampling plan has a significant impact on the supplier's optimal quality level, and we derive the conditions under which zero defects (100% conformance) is the policy that minimizes the supplier's expected annual cost. © 1997 John Wiley & Sons, Inc. Naval Research Logistics 44: 515–530, 1997     

Non-violent Resistance and Last Resort

It is commonly accepted that recourse to war is justifiable only as a last resort. If a situation can be resolved by less harmful means, then war is unjust. It is also commonly accepted that violent actions in war should be necessary and proportionate. Violent actions in war are unjust if the end towards which those actions are means can be achieved by less harmful means. In this article, I argue that satisfaction of the last resort criterion depends in part upon the likelihood of success of non-violent alternatives to war, and that the actual and potential effectiveness of non-violent resistance means that the last resort criterion of the jus ad bellum and the proportionality criterion of the jus in bello are harder to satisfy than is often presumed.     

The effect of a temporary product distribution channel on supply chain performance

We analyze a supply chain of a manufacturer and two retailers, a permanent retailer who always stocks the manufacturer's product and an intermittent deal‐of‐the day retailer who sells the manufacturer's product online for a short time. We find that without a deal‐of‐the‐day (DOTD) retailer, it is suboptimal for the manufacturer to offer a quantity discount while it is optimal for the retailer to offer periodic price discounts to consumers. With the addition of a DOTD retailer, it is likely to be optimal for the manufacturer to offer a quantity discount. We show that even without market expansion, i.e., no exclusive DOTD retailer consumers, opening the intermittent channel can leave the permanent retailer no worse‐off while increasing the manufacturer's profit. We identify the regular and discounted wholesale prices and the threshold quantity at which the manufacturer should give the discount. We also identify the optimal retail prices. We find that opening the intermittent channel increases the profit of the manufacturer, is likely to decrease the average retail price and to increase sales, and may increase the permanent retailer's profit. © 2016 Wiley Periodicals, Inc. Naval Research Logistics 63: 505–528, 2016     

Weakest‐link attacker‐defender games with multiple attack technologies

In this article, we examine a model of terrorism that focuses on the tradeoffs facing a terrorist organization that has two qualitatively different attack modes at its disposal. The terrorist organization's objective is to successfully attack at least one target. Success for the target government is defined as defending all targets from any and all attacks. In this context, we examine how terrorist entities strategically utilize an efficient but discrete attack technology — e.g., suicide attacks — when a more conventional mode of attack is available, and the optimal anti‐terrorism measures.© 2012 Wiley Periodicals, Inc. Naval Research Logistics, 2012     

Strategic obfuscation of production capacities

Recent supply‐chain models that study competition among capacity‐constrained producers omit the possibility of producers strategically setting wholesale prices to create uncertainty with regards to (i.e., to obfuscate) their production capacities. To shed some light on this possibility, we study strategic obfuscation in a supply‐chain model comprised of two competing producers and a retailer, where one of the producers faces a privately‐known capacity constraint. We show that capacity obfuscation can strictly increase the obfuscating producer's profit, therefore, presenting a clear incentive for such practices. Moreover, we identify conditions under which both producers' profits increase. In effect, obfuscation enables producers to tacitly collude and charge higher wholesale prices by moderating competition between producers. The retailer, in contrast, suffers a loss in profit, raises retail prices, while overall channel profits decrease. We show that the extent of capacity obfuscation is limited by its cost and by a strategic retailer's incentive to facilitate a deterrence. © 2014 Wiley Periodicals, Inc. Naval Research Logistics 61: 244–267, 2014     

Multiple subset sum with inclusive assignment set restrictions

In a traditional multiple subset sum problem (MSSP), there is a given set of items and a given set of bins (or knapsacks) with identical capacities. The objective is to select a subset of the items and pack them into the bins such that the total weight of the selected items is maximized. However, in many applications of the MSSP, the bins have assignment restrictions. In this article, we study the subset sum problem with inclusive assignment set restrictions, in which the assignment set of one item (i.e., the set of bins that the item may be assigned to) must be either a subset or a superset of the assignment set of another item. We develop an efficient 0.6492‐approximation algorithm and test its effectiveness via computational experiments. We also develop a polynomial time approximation scheme for this problem. © 2011 Wiley Periodicals, Inc. Naval Research Logistics, 2011     

Bringing Balancing Back In: Britain's Targeted Balancing, 1936–1939

This article challenges the conventional wisdom that Neville Chamberlain rejected the British tradition of balance of power in the 1930s. In contrast to balance of power and balance of threat theories, states do not balance against aggregate or net shifts in power. Instead, leaders define threats based on particular elements of a foreign state's power. The import is that different components of power of a foreign state are more or less threatening and aggregate shifts in power alone may not provoke counterbalancing behavior. In the 1930s, Britain balanced against the most threatening components of power: the German Luftwaffe and the threat of a knock-out air assault against the homeland, Japan's Imperial Navy and its threat to Britain's commercial trade routes and the Dominions in East Asia, and the Italian Navy and the threat to Britain's line of communication through the Mediterranean Sea to India and Asia. Given Britain's difficult financial circumstances, all other components of power, such as the army and the land components of power of Germany, Japan, and Italy were ranked as secondary in terms of its rearmament priorities. Thus, London was able to narrow the gap with Berlin in specific components of power of strategic importance such as aircraft production or to exceed Germany in other areas such as the Royal Navy and its battlefleet.     

Determining optimal sizes of bounded batches with rejection via quadratic min‐cost flow

In this article, we consider a single machine scheduling problem, in which identical jobs are split into batches of bounded sizes. For each batch, it is allowed to produce less jobs than a given upper bound, that is, some jobs in a batch can be rejected, in which case a penalty is paid for each rejected job. The objective function is the sum of several components, including the sum of the completion times, total delivery cost, and total rejection cost. We reduce this problem to a min‐cost flow problem with a convex quadratic function and adapt Tamir's algorithm for its solution. © 2017 Wiley Periodicals, Inc. Naval Research Logistics 64: 217–224, 2017     

A logistic regression/Markov chain model for NCAA basketball

Each year, more than $3 billion is wagered on the NCAA Division 1 men's basketball tournament. Most of that money is wagered in pools where the object is to correctly predict winners of each game, with emphasis on the last four teams remaining (the Final Four). In this paper, we present a combined logistic regression/Markov chain model for predicting the outcome of NCAA tournament games given only basic input data. Over the past 6 years, our model has been significantly more successful than the other common methods such as tournament seedings, the AP and ESPN/USA Today polls, the RPI, and the Sagarin and Massey ratings. © 2006 Wiley Periodicals, Inc. Naval Research Logistics, 2006.     

Legitimate Authority as a Jus Ad Bellum Condition: Defense of a Procedural Requirement in Just War Theory

ABSTRACT

Today, it is widely held that while authorization may be helpful in assuring that the other jus ad bellum criteria are met, legitimate authority is not itself a condition for just recourse to war. Or, if it is necessary, it is said to be a trivial requirement, as mobilization for war requires some political authorization. Those who would retain the legitimacy requirement have differing views about who the proper authority is. I argue that, reasonably understood, legitimate authorization is necessary for jus ad bellum. Considerations of agency and consent in force combine with the social contract to commit us to deferring to recognized authorities. These obligations are strengthened by the epistemic reliability and pragmatic value conferred by governing institutions and procedures limiting recourse to war. These same rationales imply that the U.N. Security Council should regulate the international use of force. I qualify that if higher authorities fail to act, other subsidiary authorities may then authorize force. However, the move to each subsequent level of authorization must be justified. Understood in this way, the requirement that wars not be fought without legitimate authorization is a non-trivial, necessary procedural jus ad bellum condition.     

A produce‐to‐stock system with advance demand information and secondary customers

We consider a manufacturer (i.e., a capacitated supplier) that produces to stock and has two classes of customers. The primary customer places orders at regular intervals of time for a random quantity, while the secondary customers request a single item at random times. At a predetermined time the manufacturer receives advance demand information regarding the order size of the primary customer. If the manufacturer is not able to fill the primary customer's demand, there is a penalty. On the other hand, serving the secondary customers results in additional profit; however, the manufacturer can refuse to serve the secondary customers in order to reserve inventory for the primary customer. We characterize the manufacturer's optimal production and stock reservation policies that maximize the manufacturer's discounted profit and the average profit per unit time. We show that these policies are threshold‐type policies, and these thresholds are monotone with respect to the primary customer's order size. Using a numerical study we provide insights into how the value of information is affected by the relative demand size of the primary and secondary customers. © 2007 Wiley Periodicals, Inc. Naval Research Logistics, 2007     

Some experiences using MIL-STD-105 in the united states air force

The historical and, to some extent, the current role of attribute inspection sampling in the United States Air Force is described. Some insight into consideration culminating in revisions made to the original MIL-STD-105 sampling plans is provided. These revisions were motivated from a practitioner's perspective rather than that of a statistical expert. Some significant administrative applications within the Air Force are described, and a practical method, based on the total amount of inspection, is given for distinguishing between sampling plans that have a fixed risk level (i.e., common value on the OC curves).     

Toward optimal bidding strategies

In this paper we investigate a form of rational behavior in response to an oligopoly pricing problem where only one buyer is involved. We investigate the problem from the standpoint of the seller who wants to maximize his gain from the transaction. In particular, we deal with the problem of one seller's response to an invitation to submit a sealed (i. e., noncooperative) bid to a government or other dominant purchasing agency for supplying a specified bundle of goods and services for which either (1) no other demand exists, or (2) the terms or quantities involved cannot, at least in the short run, be obtained from another source. Although treated from a normative standpoint, i. e., what bid the supplier should make, the paper also has implications for the buyer's behavior and oligopoly-monopsony pricing in a more general sense.