LESSON 64 FOUR JHANAS PART IV 20 10 2010 FREE ONLINE eNālandā Research and Practice UNIVERSITY
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The teachings of Buddha are eternal, but even then Buddha did not proclaim them to be infallible. The religion of Buddha has the capacity to change according to times, a quality which no other religion can claim to have…Now what is the basis of Buddhism? If you study carefully, you will see that Buddhism is based on reason. There is an element of flexibility inherent in it, which is not found in any other religion.
§ Bhimrao Ramji Ambedkar , Indian scholar, philosopher and architect of Constitution of India, in his writing and speeches
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FOUR JHANAS PART IV
THE FOUR JHANAS - The Buddha
THE FOUR JHANAS
From A Buddhist Dictionary: Manual of Buddhist Terms and Doctrines:
jhana: ‘absorption’ (meditation) refers chiefly to the four meditative absorptions of the fine-material sphere (rupa-jjhana or rupavacara-jjhana; see: avacara). They are achieved through the attainment of full (or attainment-, or ecstatic) concentration (appana, see: samadhi) during which there is a complete, though temporary suspension of the fivefold sense-activity and of the 5 hindrances (see: nivarana). The state of consciousness, however is one of full alertness and lucidity. This high degree of concentration is generally developed by the practice of one of the 40 subjects of tranquility meditation (samatha-kammatthana; see: bhavana). Often called the 4 immaterial spheres (arupayatanaare called absorptions of the immaterial sphere (arupa-jjhana or arupavacara-jjhana).
The Four Jhanas
There is the case where a monk — quite withdrawn from sensuality, withdrawn from unskillful qualities — enters and remains in the first jhana:
rapture and pleasure born from withdrawal, accompanied by directed thought and evaluation. He permeates and pervades, suffuses and fills this very body with the rapture and pleasure born from withdrawal. There is nothing of his entire body unpervaded by rapture and pleasure born from withdrawal.
Furthermore, with the stilling of directed thought and evaluation, he enters and remains in the second jhana:
rapture and pleasure born of composure, unification of awareness free from directed thought and evaluation — internal assurance. He permeates and pervades, suffuses and fills this very body with the rapture and pleasure born of composure. There is nothing of his entire body unpervaded by rapture and pleasure born of composure.
And furthermore, with the fading of rapture, he remains in equanimity, mindful and alert, and physically sensitive to pleasure. He enters and remains in the third jhana, of which the Noble Ones declare, ‘Equanimous and mindful, he has a pleasurable abiding.’:
He permeates and pervades, suffuses and fills this very body with the pleasure divested of rapture, so that there is nothing of his entire body unpervaded with pleasure divested of rapture.
And furthermore, with the abandoning of pleasure and stress — as with the earlier disappearance of elation and distress — he enters and remains in the fourth jhana:
purity of equanimity and mindfulness, neither-pleasure-nor-pain. He sits, permeating the body with a pure, bright awareness, so that there is nothing of his entire body unpervaded by pure, bright awareness. (Anguttara Nikaya 5: 28. From: accesstoinsight.org: Samadhanga Sutta.)
To look at the “innovation” animated cartoon page from the CartoonStock Animation directory, the web’s biggest searchable archive of cartoon animations for licensing.
The Golden Age of U.S. animation is a period in the United States animation history that began with the advent of sound cartoons in 1928, with a peak between the second half of the 1930s and the first half of the 1940s, and continued into the early 1960s when theatrical animated shorts slowly began losing to the new medium of television animation. Many memorable characters emerged from this period including Bugs Bunny, Mickey Mouse, Donald Duck, Daffy Duck, Porky Pig, Goofy, Popeye, Betty Boop, Woody Woodpecker, Mighty Mouse, Mr. Magoo, Wile E. Coyote and Road Runner , Tom and Jerry, and an incredibly popular adaptation of Superman. Feature length animation also began during this period, most notably with Walt Disney’s first films: Snow White and the Seven Dwarfs, Pinocchio, Fantasia, Dumbo and Bambi.
Can low budget features deliver great VFX?
Our Cross Channel Film Lab is currently researching the potential of visual effects in low to mid budget feature films (we’re looking at budgets of up to €10 milion). How can the latest technological developments be opened up to film-makers at every level - great VFX no longer solely the preserve of Avatar or even District 9?
The infamous VFX short “Panic Attack” by Uruguayan Fede Alvarez that led to a Hollywood deal, Neill Blomkamp’s pre-District 9 short - these successes demonstrate the potential of low budget ‘bedroom VFX’ (as in VFX made in someone’s bedroom, not VFX set in the bedroom, and probably not literally made in the bedroom, though you never know…) and of individuals using existing software to produce unexpectedly stunning visuals.
Other curious innovations at the very low budget end include international creatives collaborating on projects like Iron Sky at Wreckamovie, offering up an intriguing crowd-sourced VFX paradigm. While Blender continues to be a fascinating model for free ‘3D content creation’ technology that develops with its users.
Will the next tier of low budget VFX be led by innovations in technology - or by innovations in the use of existing technology? Do the most exciting opportunities lie in creating new tools or in bringing the most creative people together to do clever things with standard software? What other opportunities for innovation exist where the development doesn’t cost a fortune?
THE VFX LAB
Our emerging proposal is the creation of a UK/French VFX lab that can match VFX experts and trainees with advanced film projects (and of course their creative teams) to stretch the possibilities of their visions and budgets - ultimately developing short taster tapes for each project as a route to finance. We want to explore whether such a model could inspire lower budget film-makers to realise greater ambitions, and more sensational visual effects…
Our research process is just beginning, and it’s very much a new world to me - so of course, it’s very exciting - and a bit scary. We’re starting to talk to a range of inspiring people about if and how a VFX lab could work. Should it also support professional development and graduate training for creatives and VFX specialists? Does it meet a current need - or are we barking up the wrong computer-generated tree?
WHAT DOES THE INDUSTRY THINK SO FAR?
So far the response has been very positive - there seems to be an appetite amongst VFX professionals for a space where visual effects could be pushed to their limits, where creatives could learn more about the possibilities and costs of VFX, and industry entrants get practical experience of workflows, pipelines and real life projects.
Talking to those on the development side, there also seems to be a growing desire from emerging writers and directors to make films with a distinctive visual sensibility - using visual effects or ‘stereo 3D’ technology at a lower budget level in order to make something really striking, with potential to attract a broad audience.
The UK Film Council mention an increase in material coming in from creative teams with a more ‘comic book’ sensibility or stronger visual aspirations. Gareth Edwards’ up and coming sci-fi film “Monsters” is currently highlighted as a more recent example of great bedroom VFX. While in the world of 3D, “Street Dance 3D” was made for just £5 million (but has already apparently taken £12 million at the UK box office alone) and offers proof that populist 3D films can be made at a lower budget.
The short format also seems to serve a viable purpose when playing with VFX or 3D material - both as an R&D opportunity and a financing tool. The shorts mentioned above have reached a broad audience and led to greater opportunities for new writer/directors. While established producers are also exploring the role of shorts to ease entry into these brave new worlds. Producer Julie Baines recently developed a powerful trailer (not a scene from the proposed film, but a self contained story) for a 3D movie with which to explore the film-makers’ vision, learn about the technology and raise finance for the future film.
I’ve also heard positive examples of VFX companies getting involved in TV projects at a very early stage of development - helping producers to budget effectively, and run their shoot so that they can get the best possible results from a lower VFX budget. Here again, it seems to be more about a creative use of what exists than the development of a completely new process - but we’re keen to explore this further.
THE POLITICAL CONTEXT
It’s also interesting political timing for innovations in VFX. The government has recently announced an independent review into the UK’s VFX and gaming industries - to be delivered by Nesta and Skillset; and the VFX industry is currently on a Home Office Skills Shortage list.
The UK Companies I’ve spoken to so far are busy, particularly with US projects. Recently, visual effects in Inception, Pirates of the Caribbean, and of course Harry Potter’s wizardry have been generated by UK companies. ‘Mid size’ companies likeRushes have doubled in size in the past two years. Yet the VFX industry is still talking about how hard it can be to find graduates with the right skills. There’s clearly a need for some further innovation, and training.
It is of course a very challenging time in the UK for accessing funding for projects that attempt to innovate in film-making. The future for the UK Film Council and regional development agencies looks bleak, and we don’t yet know how the regional screen agencies will fare. Budgets are being cut across the board.
On the positive, this sets a strong context for innovations at the lower budget level. But even if our VFX lab develops into a project with clear value, and we can prove a strong economic benefit for the UK film industry, one of our biggest challenges yet may lie in finding secure sources of funding.
Our research is ongoing - so everything I’ve mulled over here may change. But at the moment, it’s really exciting to see that a lab with the best talent from the UK and France could serve a clear purpose and generate real progress. And perhaps more importantly, it’s exciting to see genuine potential for low-mid budget film-makers to use VFX in ever more compelling ways.
(And I haven’t even started to talk about the potential benefits of getting VFX practitioners and screenwriters to inspire each other at an early stage - that’s for another post…)
If you have any thoughts about how VFX can best be developed for lower budget films, do please get in touch. We’d love to hear from you.
This video shows how visual effects in movies has evolved since 1900.
is our regular column that highlights emerging technological ideas and where they may lead
Blasting zombies may seem to have little to do with serious research, but video game hardware is helping scientists in a variety of ways including helping them to unravel the mysteries of the brain.
Specialist programmers have long been repurposing the graphics processing units (GPUs) that power action-packed scenes in games for non-graphics tasks. Now recent advances have opened up GPU-based supercomputing to non-specialists.
GPUs have greater raw computational power than conventional CPUs, but have a more limited repertoire of tasks. Combining hundreds of individual processors, they excel at applying simple repetitive calculations to large bodies of data.
Nicolas Pinto of the Massachusetts Institute of Technology is using them in his efforts to crack the brain’s formula for recognising objects in images. “The interesting thing about a GPU is that they are made to produce a visual world,” he says. “What we want to do is reverse that process.
“When an object moves across your retina, it will obey certain rules, the physical rules of the world,” Pinto says. “We are trying to learn these rules from scratch.”
Last year, for less than $3000, he built a 16-GPU “monster” desktop supercomputer to generate and test over 7000 possible variations of an object-recognition algorithm on video clips.
To test each model, Pinto’s makeshift supercomputer performed statistical analysis in both space and time on thousands of frames of video to find objects moving through the scene. Selecting for the models best able to decipher the action, he was able to match or better more traditional approaches.
He says this kind of work would previously have only been possible with a fully fledged supercomputer.
“If we weren’t newcomers in this field and could apply for multi-million dollar grants, then yes, we could probably get one of these massive computers from IBM,” he says. “But if money is an issue, or you are a newcomer, that is too expensive. It’s very cheap to buy a GPU and explore.”
The latest graphics cards, from manufacturers ATI and Nvidia have 512 individual processors. By dividing the work among these processors, they can reach speeds of half a trillion calculations per second.
Previously it took specialist programming skills to set GPUs to work on serious, non-graphics science, but the process was difficult and time-consuming.
“The path from describing the problem to getting results was pretty treacherous,” says Nvidia general manager Andy Keane.
“Things were in computer graphics shader languages and texture coordinates – none of the stuff we were used to in scientific computing,” says Chris Johnson, director of the Scientific Computing and Imaging Institute at the University of Utah in Salt Lake City. “It was extraordinarily difficult to map your problem to a GPU.”
Johnson says this changed around 2007 with the advent of new programming languages that make it easier for programmers without specialist graphics experience to program GPUs. Since then, researchers in both academia and industry have used them to, for example, analyse astronomical signals,simulate molecular interactions and rapidly check files for malware.
While GPUs make desktop supercomputing accessible to a wide range of researchers, flagship computing centres such as Oak Ridge National Laboratory in Tennessee have also taken notice. Oak Ridge announced last October that its next supercomputer, predicted to be the world’s fastest, would be built from GPUs.
“As we look at how to get the next 1000 times faster, to an exaflops, or 1018calculations per second, we see a lot of big challenges,” says Buddy Bland, a project director at Oak Ridge.
He says that the lab already uses clusters of GPUs for some number-crunching computing tasks such as climate modelling and simulations of supernovas. He says that increased precision and speed, along with reduced power consumption, make the cards an attractive option for the next generation of supercomputers. “We think this is one path to getting the higher-performance computing that we need.”
Innovation columns: The Wi-Fi database that shamed Google, One web language to rule them all, Robots look to the cloud for enlightenment, iPad is child’s play but not quite magical, Only mind games will make us save power, Gaze trackers eye computer gamers, Market research wants to open your skull, Sending botnets the way of smallpox,Bloom didn’t start a fuel-cell revolution.
It is the most important business topic of all: identifying and fulfilling the unmet opportunity. Few business schools teach about it. Fewer still give you the experience of doing it.
The Management of Innovation and Product Development track teaches a rigorous and analytical process that structures the work involved in innovation, a process that allows innovation to be ongoing and replicable. Students gain not only knowledge and skills relevant to innovation but also gain experience in an innovation project. The initial phase of the innovation process is to identify problems to solve, which is to elicit what the target market wants even when they don’t yet know it. Middle phases focus on translating research findings into product specifications. The latter phase focuses on conceptualization and refinement of the solutions, both of the product prototype and of the solution business plan. Students learn and experience the process in the corporate-sponsored capstone course, where faculty from Carnegie Mellon’s top ranked schools of business, engineering, and fine arts provide coursework and team guidance.
By design, the track is multidisciplinary, using not only skills from various disciplines but also collaborative platforms to rapidly interconnect marketplace research, design insight, technology solutions, and business models. Companies are simultaneously becoming both analytical and innovative, making the experience and skills from the Management of Innovation and Product Development track relevant and valued in today’s marketplace.
WHO SHOULD APPLY
Graduates of this track are adept at knowing not just how to solve problems but how to define them. They know how to collect and integrate varied perspectives into a valued product (software, service, system, or brand). They know how to communicate their concept in a proposal to senior management and to manage the project through to commercialization. Previous graduates have taken positions at small and large companies that are open to change, including Apple, eBay, PowerCast, RedZone Robotics, Plextronics, and IDEO. Students enrolling in the track should have a rigorous focus on understanding and documenting marketplace needs as well as company technologies, capabilities, and skills. They should be willing to shoulder risk to achieve what they find will be profitable for company and customers alike. Students should want to work in environments where they provide their own structure to their work, maybe even writing their own job description. In sum, applicants should not only exhibit intellectual achievement but also motivation, responsibility, perception, and an open mind.
REQUIRED TRACK COURSES
Track course teach requisite skills for innovation as well as give students the experience of working with topics and people in other relevant disciplines. The track includes the following required courses.
Students with an engineering degree may be exempted from the engineering requirement. Likewise, students with a degree in industrial design may be exempted from the industrial design requirement. In addition to the required courses, students must complete an additional 1-2 electives selected by the student and approved by the track faculty coordinator. Example electives include:
The program culminates in a capstone project course that is sponsored by an industry partner. Past sponsors include Ford, New Balance, Respironics, BodyMedia, Dormont Manufacturing, and International Truck. Sponsoring companies have applied for more than 15 patents on student projects in the course.
For further information about the Management of Innovation and Product Development track, please contact the faculty coordinator:
Associate Professor of Marketing
Tepper School of Business
Innovation in BIOTECHNOLOGY (BT)
The private sector has dominated the development and delivery of transgenic, or GMO, crop varieties in all countries except China. The commercialization of GMOs has been highly concentrated. Just four crops (cotton, soybeans, maize, and canola) account for virtually all of the GMO area; 97% of world area occurs in five large countries, and 96% of world investment occurs in industrialized countries (James, 2002). Because GMOs originate in the private sector, they are subject to intellectual property (IP) protection. This confers limited monopoly power to innovators and affects research and development (R&D) investment incentives, pricing strategies, and the availability of technology. When the monopolist/innovator is able to prevent buyers from reselling their product, they may be able to price discriminate to accentuate the effects of monopoly power.
In this paper we examine the welfare effects of monopoly and price discrimination in the marketing of biotechnology discoveries. Two main issues are examined. The first issue is the general case of the distribution of benefits when the attempt to price discriminate is added to the effect of intellectual property rights (IPR)-induced monopoly power. Secondly, the effect of price discrimination on the availability of technology in small markets is examined. We demonstrate that even though price discrimination is often considered to be an unwanted market distortion, it may increase total welfare by increasing total output and by making goods available in markets where they would not appear otherwise. The policy implication is that in some cases, allowing price discrimination may be a desirable policy for encouraging private-sector investment in small markets. Several empirical studies have shown that farmers can receive significant benefits from private-sector provision of improved inputs, even in the presence of monopoly power (e.g., Falck-Zepeda, Traxler, & Nelson, 2000; Jefferson-Moore & Traxler, in press; Oehmke & Wolf, 2004; Qaim & Traxler, 2005), but the effect of price discrimination has not been examined within this context.
At present, the majority of biotechnology investments occur in developed countries (Table 1), and about 70% of that investment is from private sources. Few developing countries currently have access to biotechnology products, and virtually all biotechnology products used in developing countries today are spillovers from developed countries.
|Funding source||Expenditures ($ million)|
|Industrial countries (96%)||Private (70%)||3,100|
|Developing countries (4%)||China||115|
|Note. Data from James (2002).|
Monopoly Pricing and Price Discrimination
A monopoly does not always lead to inefficient production due to price-setting behavior. Marginal cost pricing under perfect competition does not guarantee efficiency, because revenues from marginal cost pricing may not always cover total costs and may reduce future investment (Varian, 1996). Robinson (1933) pointed out that the comparison between monopoly and competitive output levels under similar cost structures may be flawed, because a monopolist can only exist in an imperfect market. In addition, the monopolist may have a different cost structure, including a downward-sloping marginal cost curve, from that of the (long run) total cost structure of the perfectly competitive market (Robinson, 1933). Moschini and Lapan (1999) also showed that if the efficiency of the improved seed compared to the conventional variety is high enough, then the monopolist price measured in efficiency units may be lower than the price of conventional seed when measured in efficiency units.
Under certain conditions, it is possible for a monopolist to price discriminate. For the monopolist to take advantage of the different valuation of the output by consumers, arbitrage opportunities must be absent, and the market must be segmented.
The output level and welfare impact of adding price discrimination to monopoly power has received a significant amount of attention dating back to Pigou (1920) and Robinson (1933) with substantial recent contributions from Varian (1985,1996), Schmalensee (1981), and others. Few general conclusions can be drawn from the literature, but the change in output and welfare induced through price discrimination can be analytically determined for any given case. Robinson showed that differences in “concavities” of the marginal revenue curves of the separate markets is necessary for price discrimination to lead to an increase in total output. She went on to say that whenever total output produced under discrimination is higher than under simple monopoly, society is better off, and in situations where total output under discrimination and simple monopoly are the same, society may be better off depending on the tradeoff between welfare of the “weak” (more elastic) markets compared to the “strong” (less elastic) markets. A number of studies, including Schmalensee (1981), Varian (1985), Shih, Mai, and Liu (1988), and Layson (1988) have attempted to refine these claims.
A review of these studies indicates that whether discrimination leads to an increase or decrease in social welfare is an empirical question. Knowledge of the shape of the demand and marginal revenue curves and the magnitude of the demand elasticities (and to some extent, the shape of the marginal cost curve) help to determine the sign and magnitude of the change in welfare. However, it is unequivocal that with price discrimination, total output and welfare will increase if small (niche) markets that would otherwise be priced out of the market for the technology enter the market at the lower discriminated price (Varian, 1996).
Three types of price discrimination are discussed in the literature. We assume third-degree price discrimination in the market for cotton seed.1 Here, buyers may be grouped into a number of separate segments. Each segment pays a different price for the same output. The more elastic group pays a lower price than the less elastic markets. With regard to the welfare implications of third-degree price discrimination, the seller captures more of the benefits and possibly less deadweight loss than a nondiscriminating monopolist. In addition, there is a redistribution of benefits among buyers—from the less elastic to the more elastic markets.
Price Discrimination in the Seed Market
The sunk or fixed costs of developing an innovation such as herbicide tolerance are often large. However, once developed, the marginal cost of producing additional improved seed is very small. The laws and enforcement of intellectual property rights (IPR) have provided innovating firms with some monopoly power in the market for seeds (Falck-Zepeda et al., 2000), allowing the innovating firms to set a price higher than marginal cost. This provides a powerful incentive for private-sector innovation, for without monopoly power innovators may not be able to cover their total costs, thus restricting the range of technologies available to farmers. In the section that follows we present a model that compares the welfare consequences of price discrimination versus a one-price policy for an IP protected innovation suitable for two separated markets. The implication is that if the ability to price discriminate is restricted through natural arbitrage or commercial policy, total welfare may be less.
Bt cotton presents a case of potential price discrimination. Monsanto has been essentially a monopoly supplier of Bt cotton because it owns the patents to the key genetic events—even though a number of seed companies sell a number of different varieties of Bt cotton, they all rely on the same genetic event. (In 2003, Dow and Syngenta each successfully petitioned for deregulation of a genetically modified Bt cotton variety, which may erode Monsanto’s monopoly position.) The potential for a monopolist to price discriminate in Bt cotton exists for two reasons. First, upland cotton varieties tend to react to small agro-climatic variations, restricting possibilities for spatial arbitrage. This allows a certain amount of price discrimination by geographic area. Second, Monsanto (or other companies) could require the farmer to sign a technology contract with a “no resale” clause in it, effectively segmenting the market.
Assume that the price-discriminating monopolist faces two or more demand schedules that describe the monopolist’s markets: Q1 = Q1(P) and Q2 = Q2(P). With price (P), total demand faced by the monopolist is then
|QT = Q1(P) + Q2(P).||(1)|
The nondiscriminating monopolist maximizes profit such that
|MRT = P(1 + 1/ηT) = c′(QT) = MC(QT),||(2)|
where MRT is the marginal revenue of total demand, MC(QT) is the marginal cost of production, and ηT = ∂QTP / ∂PQT is the elasticity of total demand. The profit-maximizing total quantity produced by the nondiscriminating monopolist is
|QT(P) = QT( ηTc′(QT) / ηT+1 ) = Q1( ηTc′(QT) / ηT+1 ) + Q2( ηTc′(QT) / ηT+1 ).||(3)|
The price-discriminating monopolist maximizes profits when MR1 = MR2 = MRT= MC(QT) = c′(QT), so for market i,
|MRi = Pi(1 + 1/ηi) = c′(QT) = MC(QT),||(4)|
where ηi = ∂QiPi / ∂PiQi is the elasticity of market i demand. Thus, the profit-maximizing total quantity produced by the discriminating monopolist is
|QDT(P) = Q1( η1c′(QT) / η1+1 ) + Q2( η2c′(QT) / η2+1 ).||(5)|
As shown by Robinson (1933), Schmalensee (1981), and Varian (1985), there is an increase in welfare from a simple monopoly to a price-discriminating monopoly only if total quantity produced increases. Welfare change is the sum of monopoly profit and consumer surplus changes.2 Consumer surplus changes are the change in the area beneath the respective demand curves as a result of the price changes, and monopoly profit is the product of the difference between the technology fee and average cost (or marginal cost, because we model constant marginal cost) and the quantity of seed demanded by the market.
To calculate the distribution of benefits from price discrimination we follow the general procedures outlined in Alston, Norton, and Pardey (1996). Farmer benefits from discrimination are the change in consumer surplus—the area beneath the respective input demand curves and above the market price. Benefits to the innovator are taken to be the change in monopoly profit—the area above the marginal cost curve and the below the price in each market.
If the output market is competitive, the change in consumer surplus measured in the input market is equal to the change in total surplus in the output market (Jacobsen 1979; Schmalensee, 1976). For this study, we assume that farmers sell their output in a competitive market, so total welfare change from the introduction of the improved technology is the sum of the change in monopoly profit in the intermediate (seed) market and the change in consumer surplus in the input market (Moschini & Lapan, 1997). Also, Just and Hueth (1979) showed that when demand curves are estimated econometrically without including prices in other linked markets, the demand obtained is equivalent to a general equilibrium demand curve, and thus the welfare areas calculated in the seed market comprise the total welfare change within the system.
We use data from Hubbell, Marra, and Carlson (2000) empirically to examine the case of potential price discrimination in Bt cotton. Hubbell et al. (2000) presented, using data for 1996, the Bt cotton demand of cotton growers in Alabama, Georgia, North Carolina, and South Carolina divided into two regions (Upper South and Lower South) with different levels of insect resistance to pesticides and therefore with two derived demand curves. The objective of their study was to simulate the costs of reducing conventional insecticide applications through subsidization of Bt cotton. The total Bt cotton seed demand for the region comprises the Upper South (North Carolina and South Carolina) with no resistance experience (US/NR) and the Lower South (Alabama and Georgia) with some resistance experience (LS/R). Demand for Bt cotton is less elastic when insects are resistant to chemical pesticides. Data for Hubbell et al. (2000) were obtained from a survey of cotton growers conducted in 1997. From Hubbell et al. (2000), Bt cotton demand was:
|BTACRES = Pr(z(p))(BTPROP(v(p))(TOTCOT),||(6)|
where BTACRES is the number of acres planted to Bt cotton, Pr(z(p)) is the probability that a farmer adopts the Bt cotton technology at price p, BTPROP is the proportion of cotton land planted to Bt cotton once the decision is made to adopt, and TOTCOT is the total cotton area in the region. Further, the probability of adoption is calculated as Pr(z(p)) = 1 - Φ(z(p)), where Φ(z) is the standard normal cumulative density, and z(p) = x′β + α(Δy - p) was estimated to obtain estimates of β and α, the coefficients of the variables of farm and farmer attributes (x) and price, respectively. Farm and farmer attributes included in thex vector were total acres planted to cotton, share of income from cotton, percentage damaged bolls in 1995, operator’s age, number of years of growing cotton, and dummy variables for insect resistance to conventional insecticides experienced in 1995, farm location, and college education by the operator.
The proportion of cotton land planted to Bt cotton was estimated asBTPROP(v(p)) = w′γw + γpp + γλλ, where w is the vector of farm and farmer attributes and λ(z(p)) is the Mills ratio included as a variable, because BTPROP is only observed for those farmers who either adopted in 1996 or indicated their willingness to adopt at the hypothetical technology fee. Farm and farmer attributes included in the BTPROP equation were share of income from cotton, percentage damaged bolls in 1995, number of years growing cotton, and dummy variables for insect resistance to conventional insecticides experienced in 1995, farm location, and college education by the operator.
Results and Discussion
Using the demand curves for US/NR and LS/R from Hubbell et al. (2000), we determined the profit-maximizing discrimination prices and quantities for each region when the innovator (monopolist) is able to discriminate. The marginal cost of the innovator was estimated from the technology fee and the total demand elasticity (using Equation 2). The elasticity of total demand at a given price was estimated as
|ηT = (QUS/NRηUS/NR + QLS/RηLS/R) / QT.||(7)|
Given the demand function in Equation 6, elasticity of demand in market i = US/NR, LS/R is
|ηi = p × [(∂Pr(zi) / ∂p) × BTPROP(vi) + (∂BTPROP(vi) / ∂p) × Pr(zi)] × (TOTCOTi / BTACRESi).||(8)|
At the observed market price in 1996 of $32/acre, the elasticity of total demand was estimated as -2.1, which results in an implied marginal cost of $16.88/acre.
We assume constant marginal cost and the same cost structure whether or not discrimination occurs.3 By equating the individual marginal revenues to estimated marginal cost of total production, we obtained the profit-maximizing prices that the price-discriminating innovator can charge in each market. Figure 1 presents an initial situation under monopoly pricing (selling quantities a and bin the two markets), where total marginal revenue equals marginal cost, and shows the potential change from uniform pricing to price discrimination. Because US/NR is the more elastic market, the innovator charges a lower price (at point c) and sells more (from point b to point f) to farmers in that region and charges a higher price (at point d) and sells less (from point a to point g) to farmers in the less elastic market. With a marginal cost of about $16.88/acre, the innovator can charge about $25.92/acre in US/NR and about $33.09/acre in LS/R.
At the discriminatory prices, the number of acres cultivated to Bt cotton would increase from about 60 to 142 thousand acres in US/NR and decrease from about 747 to 701 thousand acres in LS/R. The total number of Bt cotton acres will increase by about 35 thousand acres. Table 2 shows the change in quantities, prices, and welfare in both markets after price discrimination. Under price discrimination, total welfare, computed as the sum of consumer surplus and monopoly profit, increases.4 Welfare to farmers in US/NR increases by about 32%, while welfare to farmers in LS/R decreases by about 3% of the value of Bt cotton seed initially sold in each market. The monopolist’s profits increase by 2%.
Because both markets were being served under uniform pricing, welfare of farmers in one of the markets (in this example, LS/R) necessarily decreases under differential pricing.
|Region||Price ($/acre)||Quantity (acre)||Welfare change ($)||Welfare change as a share of initial cost of seed (%)|
|Total welfare change||252,590a|
|Note. Data from authors’ computations using Hubbell et al. (2000).
a Differences due to rounding error.
In this paper, we analyzed the welfare effect of adding price discrimination to monopoly power in the provision of IP-protected innovations. The theoretical literature has produced few general results regarding the welfare implications of price discrimination, suggesting that empirical studies are needed. We presented a general analytical model which was parameterized using data from the introduction of Bt cotton in the southern United States. Results suggest that where both markets are being served under a one-price policy, there is a welfare loss to farmers in the less elastic market and gains to the innovator and farmers in the more elastic market.
In the Bt cotton case, the fact that the innovator (Monsanto) was not price discriminating at the time the data for this study were collected may have been due to the difficulty in preventing arbitrage between markets. Spatial arbitrage is more difficult when the second market is in a developing country (niche) market because of the geographical separation of the two markets. In this situation, a policy of differential input pricing will benefit the innovator by helping defray the investment incurred by the innovators and may represent a path for assisting developing countries to gain access to new technologies generated by R&D efforts.
A more interesting case is that of a small market not being served under uniform pricing (for instance, the case of most developing countries) but that may obtain access to the technology under price discrimination. The ability to use price discrimination to market biotechnology innovations in separated markets may be more important for developing countries to access these innovations, even though this is a controversial subject. However, this is a potentially important strategy for providing access to needed technology that may benefit both the biotechnology industry and the small market countries. Without access to cost-reducing technologies, developing countries that compete with developed-country producers will see welfare reduced because of the output price-reducing impact of technological change. Putting in place conditions under which firms are able to price discriminate across international markets holds the potential to enhance developing-country access to private-sector technology.
1 We model third-degree price discrimination, which may occur when markets are characterized by different demand schedules and when few arbitrage opportunities exist. To some extent, this form of price discrimination is curently employed by innovators who charge lower prices in some (small and more elastic) foreign markets than in (large and less elastic) domestic markets. First- and second-degree price discrimination, characterized by charging a different price for each unit and by charging different prices depending on the quantity purchased, are not likely to occur in the cotton seed market.
2 Benefits to cotton producers are referred to as consumer surplus, because we are dealing with the market for seed.
3 This is assumed to simplify the analysis, but even if this were not true, the relevant marginal cost for determining the discriminating prices and quantities for the two regions is the marginal cost of total production. Thus, assuming constant marginal cost is not a limiting assumption. However, if the cost structure of the innovator changes if they are allowed or able to discriminate, then the shape/slope of the marginal cost would be significant.
4 The demand functions are not linear, so the estimates of consumer surplus obtained are only approximations—but good approximations, because the price changes are not too large.
James, C. (2002). Global review of commercialized transgenic crops: 2001 feature: Bt cotton (ISAAA briefs 26). Ithaca, NY: International Service for the Acquisition of Agri-biotech Applications. Available on the World Wide Web:http://www.isaaa.org/kc/Publications/pdfs/isaaabriefs/Briefs%2026a.pdf.
Jefferson-Moore, K.Y., & Traxler, G. (in press). Second-generation GMOs: Where to from here? AgBioForum. Available on the World Wide Web:http://www.agbioforum.org/.
Oehmke, J.F., & Wolf, C.A. (2004). Why is Monsanto leaving money on the table? Monopoly pricing and technology valuation distributions with heterogeneous adopters. Journal of Agricultural and Applied Economics, 36(3), 705-718.
Varian, H.R. (1996). Differential pricing and efficiency. First Monday, 1(2). Available on the World Wide Web:http://www.firstmonday.dk/issues/issue2/different/index.html.
Albert K.A. Acquaye is a project economist in the Department of Agricultural and Resource Economics, University of California, Davis. Greg Traxler is a professor in the Department of Agricultural Economics and Rural Sociology, Auburn University. The authors wish to thank Michele Marra for kindly agreeing to share data for use in this study and James Oehmke and Carl Pray for their useful comments and suggestions. Financial support was received from the USDA/IFAFS.
Innovation in NANOTECHNOLOGY (NT)
Strategies for sustainable design of nanotechnology products
Innovations in Nanotechnology (NT) inspire designers and entrepreneurs to deploy nanomaterials for the creation of products that offer superior functions. There are high expectations on NT to enable substantial benefits for sustainable production and consumption. For instance, there are opportunities for improvements of energy and resource efficiency in various industrial and consumer sectors. Moreover, reduction in the use of hazardous chemical substances in products seems possible if nanomaterials replace for them. On the other hand, the use of nanoparticles in consumer products has given raise to concerns over their safety to human health and the environment. Thus far, the scientific knowledge on risks of NT is insufficient but there are early warnings that free nanoparticles can have adverse side effects.
How can prudent designers and enterprises utilize NT for the creation of innovative products that are economically and ecologically sustainable? How to take advantage of NT while avoiding unsustainable side effects?
The workshop provides a forum for knowledge cooperation and networking among researchers, designers and entrepreneurs that are interested in NT. It allows for exchange of ideas on sustainable NT and experiences (lessons learned) with mitigating risks. The aim of the workshop is encouraging a goal-oriented discussion on risk preventative innovation strategies in NT. The session starts with a short introduction in the opportunities and risks of NT as a basis for further discourse. Then, the participants engage in parallel round table discussions. They will be prompted with pre-defined questions and asked to elaborate propositions how to use NT in service of sustainable innovation.
The intended outcome of the workshop is an agenda to move nanotechnology into the real world in a sustainable way for the benefit of society, the economy and the environment.
The Scanning Probe Microscope SOLVER NEXT – the Product of NT-MDT Co. – got the Grand Prix of the Federal Russian Competition “Russian Innovations”
On May 27th 2010 the Federal Russian Competition “Russian Innovations” summed up and hanged over awards. The Scanning Probe Microscope SOLVER NEXT by the global nanotech producer NT-MDT Co. got the Grand Prix of the competition. The main goal of the competition is to announce and promote new innovative products, systems and tools in Russia and worldwide.
The Competition “Russian Innovations” is 9 years old. It is held by authoritative Russian media holding “Expert”. The partners of the event are the main nanoorganizations in the country “RUSNANO” and “RUSATOM”. The competition is an essential part of Russian innovation and nanotechnology development program. It plays a very important role in launching and promoting new high-tech developments in Russia and worldwide. Getting publicity to nanodevelopers and producers, the event increases investing rate in nanosector. Moreover, the competition helps to expertise new tools and ideas and to select only perspective ones. So, it raises the confidence rate to nanosector in Russia.
The Scanning Probe Microscope SOLVER NEXT has managed to receive Grand Prix of the “Russian Innovations-2010″. Its producer NT-MDT Co. names it “the state-of-the-art company’s development”. This tool offers both atomic force (AFM) and scanning tunnelling microscopy (STM) under one hood. This enables researchers to gain the fastest time to results, excellent performance, increased accuracy, high reliability and unprecedented ease-of-use with no loss in resolution. The flexible, sleek and functional system incorporates smart software, automated head exchange, and motorized sample positioning under video monitored control. This allows for high quality images without the need for specially trained operators.
The system has closed-loop sensors to compensate for inherent piezoelectric imperfections such as scan nonlinearity, creep and hysteresis. With two additional removable heads for operating in liquid environments and nanoindentation one has the freedom to work with a variety of samples, measuring modes and conditions. TheSOLVER NEXT has an advanced controller with a vast library of scripts and both Mac® and Windows® compatibilities. The result is an image-friendly operating system well-suited to large file, 3-dimensional mathematics and manipulation.
So, the tool is designed to meet a researcher’s current and future needs. This innovative device at the forefront of scientific research opens up new paths of study in different fields of nanotechnology, providing all user levels with a full range of conventional SPM measuring techniques (such as topography, phase imaging, nanolithography and more). SOLVER NEXT provides a robust, diverse, and economic solution for universities, industrial, routine biological and pharmaceutical labs. It makes AFM and STM accessible to a broader audience, even offering a special iPhone™ applet for simple image analysis and image sharing.
Mac®, iPhone™ are trademarks or registered trademarks of Apple Inc.; Windows® is a trade mark of Microsoft Corp.
As it pertains to technology, IT spans a wide variety of areas that include but are not limited to things such as Processes, Computer Software, Computer Hardware, Programming Languages, and Data Constructs. In short, anything that renders data, information or perceived knowledge in any visual format whatsoever, via any multimedia distribution mechanism, is considered part of the domain space known as Information Technology (IT).
As it pertains to organizations within enterprises, IT represents an operational group that helps solve such problems as those related to data, information and knowledge capture, persistence, processing, brokering, discovery and rendering. Such organizations can be as small as one or two people that can be shared between multiple small business and as large as multi-billion dollar structures that are common in all Fortune 500 enterprises.
Today, the term information has ballooned to encompass many aspects of computing and technology, and the term has become very recognizable. IT professionals perform a variety of functions (IT Disciplines/Competencies) that range from installing applications to designing complex computer networks and information databases. A few of the duties that IT professionals perform may include data management, networking, engineering computer hardware, database and software design, as well as management and administration of entire systems. Information technology is starting to spread farther than the conventional personal computer and network technology, and more into integrations of other technologies such as the use of cell phones, televisions, automobiles, and more, which is increasing the demand for such jobs.
In the recent past, ABET and the ACM have collaborated to form accreditation and curriculum standards for degrees in Information Technology as a distinct field of study separate from both Computer Science andInformation Systems. SIGITE is the ACM working group for defining these standards. The Worldwide IT services revenue totaled $763 billion in 2009.It is important to consider the overall value chain in technology development projects, as the challenge for the value creation is increasing with the growing competitiveness between organizations. The concept of value creation through technology is heavily dependent upon the alignment of technology and business strategies. While the value creation for an organization is a network of relationships between internal and external environments, technology plays a role in improving the overall value chain of an organization. However, this increase requires business and technology management to work as a creative, synergistic, and collaborative team instead of a purely mechanistic span of control. Technology can help an organization improve its competitive advantage within the industry in which it resides and generate superior performance at a greater value.
Sector structure/Market size
The Indian information technology (IT) industry has played a key role in putting India on the global map. Thanks to the success of the IT industry, India is now a power to reckon with. According to the annual report 2009-10, prepared by the Department of Information Technology (DIT), the IT-BPO industry is expected to garner a revenue aggregate of US$ 73.1 billion in 2009-10 as compared to US$ 69.4 billion in 2008-09, growing at a rate of over 5 per cent. The report predicts that the Indian IT-BPO revenues may reach US$ 225 billion in 2020.
According to DIT, the Indian software and services exports is expected to reach US$ 49.7 billion in 2009-10 as compared to US$ 47.1 billion in 2008-09, registering an increase of 5.5 per cent in dollar terms. Further, the IT services exports is estimated to grow from US$ 25.8 billion in 2008-09 to US$ 27.3 billion in 2009-10, showing a growth of 5.8 per cent.
Moreover, according to a study by Springboard Research published in February 2010, the Indian information technology (IT) market is expected to grow at around 15.5 per cent in 2010, on the back of growing investor confidence and favourable initiatives taken by the government.
The data centre services market in the country is forecast to grow at a compound annual growth rate (CAGR) of 22.7 per cent between 2009 and 2011, to touch close to US$ 2.2 billion by the end of 2011, according to research firm IDC India’s report published in March 2010. The IDC India report stated that the overall India data centre services market in 2009 was estimated at US$ 1.39 billion.
As per a report by the Internet and Mobile Association of India (IAMAI) and market research firm IMRB, the total number of Internet users in India reached 71 million in 2009. The number of active users increased to 52 million in September 2009 from 42 million in September 2008, registering a growth of 19 per cent year-on-year, stated the report.
According to IDC India, during January-March 2010, total PC sales in India reached 2,240,000 units registering a year-on-year increase of 33 per cent over the same period in 2009. Desktop PC sales witnessed a year-on-year increase of 18 per cent during January-March 2010, over the corresponding period last year to reach 1,436,000 units. The sales of Notebook computers also increased by 72 per cent year-on-year, clocking 803,000 shipments.
India is a preferred destination for companies looking to offshore their IT and back-office functions. It also retains its low-cost advantage and is a financially attractive location when viewed in combination with the business environment it offers and the availability of skilled people.
Some big deals in the outsourcing space include:
The market for enterprise networking equipment in India is estimated to grow from US$ 1 billion in 2008 to US$ 1.7 billion by 2012, recording a compounded annual growth rate (CAGR) of 15 per cent during this period, according to a study by Springboard Research titled ‘Epicenter of Growth–Indian Enterprise Networking Equipment Market Report’ released in December 2009.
Moreover, according to NASSCOM government, IT spend was US$ 3.2 billion in 2009 and is expected to reach US$ 5.4 billion by 2011. Further, according to NASSCOM, there is US$ 9 billion business opportunity in e-governance in India.
The Indian information technology sector continues to be one of the sunshine sectors of the Indian economy showing rapid growth and promise.
According to a report prepared by McKinsey for NASSCOM called ‘Perspective 2020: Transform Business, Transform India’ released in May 2009, the exports component of the Indian industry is expected to reach US$ 175 billion in revenue by 2020. The domestic component will contribute US$ 50 billion in revenue by 2020. Together, the export and domestic markets are likely to bring in US$ 225 billion in revenue, as new opportunities emerge in areas such as public sector and healthcare and as geographies including Brazil, Russia, China and Japan opt for greater outsourcing.