define pareto chart in statistics

The experimental data can be plotted in a 3D Bar Chart. The effect of each factor can be plotted in a Pareto Chart. The negative effect of the interaction is most easily seen when the pressure is set to 50 psi and Temperature is set to 100 degrees.

Design of Experiments (DOE) Tutorial

Design of Experiments (DOE) Tutorial Design of experiments (DOE) is a powerful tool that can be used in a variety of experimental situations. DOE allows for multiple input factors to be manipulated determining their effect on a desired output (response).

By manipulating multiple inputs at the same time, DOE can identify important interactions that may be missed when experimenting with one factor at a time. All possible combinations can be investigated (full factorial) or only a portion of the possible combinations (fractional factorial).

Fractional factorials will not be discussed here. When to Use DOEUse DOE when more than one input factor is suspected of influencing an output. For example, it may be desirable to understand the effect of temperature and pressure on the strength of a glue bond. DOE can also be used to confirm suspected input/output relationships and to develop a predictive equation suitable for performing what-if analysis. DOE Procedure Acquire a full understanding of the inputs and outputs being investigated. A process flow diagram or process map can be helpful. Utilize subject matter experts as necessary. Determine the appropriate measure for the output. A variable measure is preferable.

Attribute measures (pass/fail) should be avoided. Ensure the measurement system is stable and repeatable. Create a design matrix for the factors being investigated. The design matrix will show all possible combinations of high and low levels for each input factor.

These high and low levels can be generically coded as +1 and -1. For example, a 2 factor experiment will require 4 experimental runs: Input A Level Input B Level Experiment #1 -1 -1Experiment #2 -1 +1Experiment #3 +1 -1Experiment #4 +1 +1Note: The required number of experimental runs can be calculated using the formula 2 n where n is the number of factors.

For each input, determine the extreme but realistic high and low levels you wish to investigate. In some cases the extreme levels may be beyond what is currently in use.

The extreme levels selected should be realistic, not absurd. For example:-1 Level +1 Level Temperature 100 degrees 200 degrees Pressure 50 psi 100 psi Enter the factors and levels for the experiment into the design matrix.

Perform each experiment and record the results. For example: Temperature Pressure Strength Experiment #1 100 degrees 50 psi 21 lbs Experiment #2 100 degrees 100 psi 42 lbs Experiment #3 200 degrees 50 psi 51 lbs Experiment #4 200 degrees 100 psi 57 lbs Calculate the effect of a factor by averaging the data collected at the low level and subtracting it from the average of the data collected at the high level.

For example: Effect of Temperature on strength: (51 + 57)/2 - (21 + 42)/2 = 22.5 lbs Effect of Pressure on strength: (42 + 57)/2 - (21 + 51)/2 = 13.5 lbs The interaction between two factors can be calculated in the same fashion. First, the design matrix must be amended to show the high and low levels of the interaction. The levels are calculated by multiplying the coded levels for the input factors acting in the interaction. For example: Input A Level Input B Level Interaction Experiment #1 -1 -1 +1Experiment #2 -1 +1 -1Experiment #3 +1 -1 -1Experiment #4 +1 +1 +1Calculate the effect of the interaction as before. Effect of the interaction on strength: (21 + 57)/2 - (42 + 51)/2 = -7.5 lbs

Keeping the temperature at 200 degrees will avoid the negative effect of the interaction and help ensure a strong glue bond.

Conduct and Analyze Your Own DOEConduct and analyze up to three factors and their interactions by downloading the 3-factor DOE template (Excel, 104 KB). Summary More complex studies can be performed with DOE. The above 2-factor example is used for illustrative purposes. A thorough discussion of DOE can be found in Juran’s Quality Handbook. Contributed by Dean Christolear.

A Pareto improvement is a change to a different allocation that makes at least one individual or preference criterion better off without making any other individual or preference criterion worse off, given a certain initial allocation of goods among a set of individuals.

Pareto efficiency

"From Wikipedia, the free encyclopedianavigation search Pareto efficiency or Pareto optimality is a state of allocation of resources from which it is impossible to reallocate so as to make any one individual or preference criterion better off without making at least one individual or preference criterion worse off. The concept is named after Vilfredo Pareto (1848–1923), Italian engineer and economist, who used the concept in his studies of economic efficiency and income distribution.

The concept has been applied in academic fields such as economics, engineering, and the life sciences. The Pareto frontier is the set of all Pareto efficient allocations, conventionally shown graphically. It also is variously known as the Pareto front or Pareto set. [1]

An allocation is defined as ""Pareto efficient"" or ""Pareto optimal"" when no further Pareto improvements can be made, in which case we are assumed to have reached Pareto optimality. ""Pareto efficiency"" is considered as a minimal notion of efficiency that does not necessarily result in a socially desirable distribution of resources: it makes no statement about equality, or the overall well-being of a society.

[2] [3]The notion of Pareto efficiency has been applied to the selection of alternatives in engineering and similar fields. Each option is first assessed, under multiple criteria, and then a subset of options is ostensibly identified with the property that no other option can categorically outperform any of its members.

Contents [ hide ]1 Overview2 Weak Pareto efficiency3 Constrained Pareto efficiency4 Use in engineering and economics4.1 Formal representation4.1.1 Pareto frontier4.1.2 Relationship to the marginal rate of substitution4.1.3 Computation5 Criticisms6 See also7 References8 Further reading Overview [ edit]A production-possibility frontier is an example of a Pareto-efficient frontier, where the frontier and the area left and below it is a continuous room of choices. The red points are examples of Pareto-optimal choices of production. Points off the frontier, such as N and K, are not Pareto-efficient. ""Pareto optimality"" is a formally defined concept used to determine when an allocation is optimal.

An allocation is not Pareto optimal if there is an alternative allocation where improvements can be made to at least one participant's well-being without reducing any other participant's well-being. If there is a transfer that satisfies this condition, the reallocation is called a ""Pareto improvement.""

When no further Pareto improvements are possible, the allocation is a ""Pareto optimum. ""The formal presentation of the concept in an economy is as follows: Consider an economy with agents and goods. Then an allocation, where, is Pareto optimal if there is no other feasible allocation such that, for utility function for each agent, for all with for some.

[4] Here, in this simple economy, ""feasibility"" refers to an allocation where the total amount of each good that is allocated sums to no more than the total amount of the good in the economy.

In a more complex economy with production, an allocation would consist both of consumption vectors and production vectors, and feasibility would require that the total amount of each consumed good is no greater than the initial endowment plus the amount produced.

In principle, a change from a generally inefficient economic allocation to an efficient one is not necessarily considered to be a Pareto improvement. Even when there are overall gains in the economy, if a single agent is disadvantaged by the reallocation, the allocation is not Pareto optimal.

For instance, if a change in economic policy eliminates a monopoly and that market subsequently becomes competitive, the gain to others may be large. However, since the monopolist is disadvantaged, this is not a Pareto improvement. In theory, if the gains to the economy are larger than the loss to the monopolist, the monopolist could be compensated for its loss while still leaving a net gain for others in the economy, allowing for a Pareto improvement.

Thus, in practice, to ensure that nobody is disadvantaged by a change aimed at achieving Pareto efficiency, compensation of one or more parties may be required.

It is acknowledged, in the real world, that such compensations may have unintended consequences leading to incentive distortions over time, as agents supposedly anticipate such compensations and change their actions accordingly. [5]Under the idealized conditions of the first welfare theorem, a system of free markets, also called a "" competitive equilibrium ,"" leads to a Pareto-efficient outcome.

It was first demonstrated mathematically by economists Kenneth Arrow and Gérard Debreu. However, the result only holds under the restrictive assumptions necessary for the proof: markets exist for all possible goods, so there are no externalities; all markets are in full equilibrium; markets are perfectly competitive; transaction costs are negligible; and market participants have perfect information.

In the absence of perfect information or complete markets, outcomes will generally be Pareto inefficient, per the Greenwald-Stiglitz theorem. [6]The second welfare theorem is essentially the reverse of the first welfare-theorem. It states that under similar, ideal assumptions, any Pareto optimum can be obtained by some competitive equilibrium, or free market system, although it may also require a lump-sum transfer of wealth.

[4]Weak Pareto efficiency [ edit]A ""weak Pareto optimum"" (WPO) is an allocation for which there are no possible alternative allocations whose realization would cause every individual to gain. [ citation needed] Thus, an alternative allocation is considered to be a Pareto improvement if and only if the alternative allocation is strictly preferred by all individuals.

When contrasted with weak Pareto efficiency, a standard Pareto optimum as described above may be referred to as a ""strong Pareto optimum"" (SPO). Weak Pareto-optimality is ""weaker"" than strong Pareto-optimality in the sense that any SPO also qualifies as a WPO, but a WPO allocation is not necessarily an SPO.

A market doesn't require local nonsatiation to get to a weak Pareto-optimum. [7]Constrained Pareto efficiency [ edit]The condition of constrained Pareto optimality is a weaker version of the standard condition of Pareto optimality employed in economics, which ostensibly accounts for the fact that a potential planner (e.g., the government) may not be able to improve upon a decentralized market outcome, even if that outcome is inefficient.

This will occur if it is limited by the same informational or institutional constraints as are individual agents. [8]The most commonly proffered example is of a setting where individuals have private information (for example, a labor market where the worker's own productivity is known to the worker but not to a potential employer, or a used-car market where the quality of a car is known to the seller but not to the buyer) which results in moral hazard or an adverse selection and a sub-optimal outcome.

In such a case, a planner who wishes to improve the situation is deemed unlikely to have access to any information that the participants in the markets do not have.

Hence, the planner cannot implement allocation rules which are based on the idiosyncratic characteristics of individuals; for example, ""if a person is of type A, they pay price p1, but if of type B, they pay price p2"" (see Lindahl prices ). Essentially, only anonymous rules are allowed (of the sort ""Everyone pays price p"") or rules based on observable behavior; ""if any person chooses x at price px then they get a subsidy of ten dollars, and nothing otherwise"".

If there exists no allowed rule that can successfully improve upon the market outcome, then that outcome is said to be ""constrained Pareto-optimal. ""Note that the concept of constrained Pareto optimality assumes benevolence on the part of the planner and hence it is distinct from the concept of government failure, which occurs when the policy making politicians fail to achieve an optimal outcome simply because they are not necessarily acting in the public's best interest.

Use in engineering and economics [ edit]Example of a Pareto frontier. The boxed points represent feasible choices, and smaller values are preferred to larger ones. Point C is not on the Pareto frontier because it is dominated by both point A and point B. Points A and B are not strictly dominated by any other, and hence do lie on the frontier.

The notion of Pareto efficiency has been used in engineering. Given a set of choices and a way of valuing them, the Pareto frontier or Pareto set or Pareto front is the set of choices that are Pareto efficient.

Pareto efficiency

The concept has been applied in academic fields such as economics, engineering, and the life sciences. The Pareto frontier is the set of all Pareto efficient allocations, conventionally shown graphically. It also is variously known as the Pareto front or Pareto set. [1]

A Pareto improvement is a change to a different allocation that makes at least one individual or preference criterion better off without making any other individual or preference criterion worse off, given a certain initial allocation of goods among a set of individuals.

An allocation is defined as ""Pareto efficient"" or ""Pareto optimal"" when no further Pareto improvements can be made, in which case we are assumed to have reached Pareto optimality. ""Pareto efficiency"" is considered as a minimal notion of efficiency that does not necessarily result in a socially desirable distribution of resources: it makes no statement about equality, or the overall well-being of a society.

[2] [3]The notion of Pareto efficiency has been applied to the selection of alternatives in engineering and similar fields. Each option is first assessed, under multiple criteria, and then a subset of options is ostensibly identified with the property that no other option can categorically outperform any of its members.

An allocation is not Pareto optimal if there is an alternative allocation where improvements can be made to at least one participant's well-being without reducing any other participant's well-being. If there is a transfer that satisfies this condition, the reallocation is called a ""Pareto improvement.""

When no further Pareto improvements are possible, the allocation is a ""Pareto optimum. ""The formal presentation of the concept in an economy is as follows: Consider an economy with agents and goods. Then an allocation, where, is Pareto optimal if there is no other feasible allocation such that, for utility function for each agent, for all with for some.

[4] Here, in this simple economy, ""feasibility"" refers to an allocation where the total amount of each good that is allocated sums to no more than the total amount of the good in the economy.

In a more complex economy with production, an allocation would consist both of consumption vectors and production vectors, and feasibility would require that the total amount of each consumed good is no greater than the initial endowment plus the amount produced.

In principle, a change from a generally inefficient economic allocation to an efficient one is not necessarily considered to be a Pareto improvement. Even when there are overall gains in the economy, if a single agent is disadvantaged by the reallocation, the allocation is not Pareto optimal.

For instance, if a change in economic policy eliminates a monopoly and that market subsequently becomes competitive, the gain to others may be large. However, since the monopolist is disadvantaged, this is not a Pareto improvement. In theory, if the gains to the economy are larger than the loss to the monopolist, the monopolist could be compensated for its loss while still leaving a net gain for others in the economy, allowing for a Pareto improvement.

Thus, in practice, to ensure that nobody is disadvantaged by a change aimed at achieving Pareto efficiency, compensation of one or more parties may be required.

It is acknowledged, in the real world, that such compensations may have unintended consequences leading to incentive distortions over time, as agents supposedly anticipate such compensations and change their actions accordingly. [5]Under the idealized conditions of the first welfare theorem, a system of free markets, also called a "" competitive equilibrium ,"" leads to a Pareto-efficient outcome.

It was first demonstrated mathematically by economists Kenneth Arrow and Gérard Debreu. However, the result only holds under the restrictive assumptions necessary for the proof: markets exist for all possible goods, so there are no externalities; all markets are in full equilibrium; markets are perfectly competitive; transaction costs are negligible; and market participants have perfect information.

In the absence of perfect information or complete markets, outcomes will generally be Pareto inefficient, per the Greenwald-Stiglitz theorem. [6]The second welfare theorem is essentially the reverse of the first welfare-theorem. It states that under similar, ideal assumptions, any Pareto optimum can be obtained by some competitive equilibrium, or free market system, although it may also require a lump-sum transfer of wealth.

[4]Weak Pareto efficiency [ edit]A ""weak Pareto optimum"" (WPO) is an allocation for which there are no possible alternative allocations whose realization would cause every individual to gain. [ citation needed] Thus, an alternative allocation is considered to be a Pareto improvement if and only if the alternative allocation is strictly preferred by all individuals.

When contrasted with weak Pareto efficiency, a standard Pareto optimum as described above may be referred to as a ""strong Pareto optimum"" (SPO). Weak Pareto-optimality is ""weaker"" than strong Pareto-optimality in the sense that any SPO also qualifies as a WPO, but a WPO allocation is not necessarily an SPO.

A market doesn't require local nonsatiation to get to a weak Pareto-optimum. [7]Constrained Pareto efficiency [ edit]The condition of constrained Pareto optimality is a weaker version of the standard condition of Pareto optimality employed in economics, which ostensibly accounts for the fact that a potential planner (e.g., the government) may not be able to improve upon a decentralized market outcome, even if that outcome is inefficient.

In such a case, a planner who wishes to improve the situation is deemed unlikely to have access to any information that the participants in the markets do not have.

Use in engineering and economics [ edit]Example of a Pareto frontier. The boxed points represent feasible choices, and smaller values are preferred to larger ones. Point C is not on the Pareto frontier because it is dominated by both point A and point B. Points A and B are not strictly dominated by any other, and hence do lie on the frontier.

The notion of Pareto efficiency has been used in engineering. Given a set of choices and a way of valuing them, the Pareto frontier or Pareto set or Pareto front is the set of choices that are Pareto efficient.

Pareto Analysis is a statistical technique in decision making that is used for the selection of a limited number of tasks that produce significant overall effect. It uses the Pareto Principle (also know as the 80/20 rule) the idea that by doing 20% of the work you can generate 80% of the benefit of doing the whole job. Or in terms of quality improvement, a large majority of problems (80%) are produced by a few key causes (20%).

"Pareto analysis - Seven steps to identifying the important causes using Pareto Analysis Quality Circles Corporate Social Responsibility Internalizing CSR: Initiatives of HRMHR’s Role in Promoting Corporate Social Responsibility Three Key Areas of Corporate Social Responsibility Quality of Work Life Quality of Work Life Hour of Work and Quality of Work Improvement of the quality of work life Quality Circles Quality Circles Problem Solving Tools Used by Quality Circles,Brainstorming.

Pareto analysis. Cause and effect diagram (or fish bone diagram or Ishikawa diagram). Vilfredo Federico Damaso Pareto (15 July 1848 – 19 August 1923), was an Italian engineer, sociologist, economist, political scientist and philosopher.

Pareto Analysis The Pareto Chart or Pareto Diagram, named after the famous economist Vilfredo Pareto (1848-1923), is a common tool for quality control and is used as part of a Pareto Analysis to visually identify the most important factors, most occurring defects, or the most common problems, or in other words ""the vital few"".

This is also known as the vital few and the trivial many. The 80/20 Rule may be applied to almost anything, from the science of management to the physical world. What Is It? The Pareto Chart is one of the 'Seven Basic Tools of Quality Control.' It helps highlight the most important factors from among a group of many factors.

In quality control, it is often used to represent the most common sources of defects or the highest occurrence of defects. It is a simple bar chart that displays the number of occurrences on the left vertical axis and the category of occurrences on the horizontal axis.

While not required, you can add a right vertical axis which represents the cumulative percentage of the left axis to the total. The Pareto Principle, or 80-20 Rule, is a general rule-of-thumb or guideline that says that 80% of the effects stem from 20% of the causes.

Vilfredo Pareto originally observed that in Italy, 80% of the land was owned by 20% of the people. Dr. Joseph M. Juran, a 20th century evangelist for quality management, applied this principal to quality control and preferred the use of the phrase ""the vital few and the useful many"" to describe the 80-20 rule.

Although the actual numbers may be different from case-to-case, the Pareto Principle is a guiding principle used in business for ... Customer Complaints (e.g. 80% of the complaints come from 20% of the customers)Management (e.g. 80% of the results come from 20% of the group)Sales (e.g. 80% of the profits come from 20% of the products)Quality Management for identifying the most important causes for defects (e.g.

80% of the problems come from 20% of the causes)A pareto chart can help you quickly identify the most significant factors, but choosing which problems to fix may still require a cost-benefit analysis . If you have a single factor causing 50% of the problems, but it would cost you a million dollars to fix, and there are 3 other factors causing a total of 30% of the problems that would be much less expensive to fix, perhaps solving the 3 other factors first would be more beneficial.

Chart Example Look at a part of your business where you have had consistency problems. An example might be customer service problems.

Say you collect data on your customer complaints for April and find that you have problems with:delivery when promised (5 complaints)quantity delivered (12 complaints)invoice pricing errors (8 complaints)invoice quantity errors (2 complaints)damaged product (26 complaints)Seven steps to identifying the important causes using Pareto Analysis : Form a table listing the causes and their frequency as a percentage.

Arrange the rows in the decreasing order of importance of the causes, i.e. the most important cause first. Add a cumulative percentage column to the table. Plot with causes on x-axis and cumulative percentage on y-axis. Join the above points to form a curve. Plot (on the same graph) a bar graph with causes on x-axis and percent frequency on y-axis. Draw a line at 80% on y-axis parallel to x-axis. Then drop the line at the point of intersection with the curve on x-axis.

This point on the x-axis separates the important causes on the left and less important causes on the right. This is a simple example of a Pareto diagram using sample data showing the relative frequency of causes for customer service problems.

It enables you to see what 20% of complaints are causing 80% of the problems and where efforts should be focussed to achieve the greatest improvement. The value of the Pareto Principle for a project manager is that it reminds you to focus on the 20% of things that matter. Of the things you do during your project, only 20% are really important. Those 20% produce 80% of your results. Identify and focus on those things first, but don't totally ignore the remaining 80% of causes. "

. In particular, a portfolio A is dominated by another portfolio A' if A' has a greater expected gain and a lesser risk than A. If no portfolio dominates A, A is a Pareto-optimal portfolio. The set of Pareto-optimal returns and risks is called the Pareto efficient frontier for the Markowitz portfolio selection problem.

Portfolio (finance)

"From Wikipedia, the free encyclopedia (Redirected from Investment portfolio)navigation search This article needs additional citations for verification. Please help improve this article by adding citations to reliable sources. Unsourced material may be challenged and removed.

(March 2011) ( Learn how and when to remove this template message)In finance, a portfolio is a collection of investments held by an investment company, hedge fund, financial institution or individual. [1]Contents [ hide ]1 Definition2 Description3 See also4 References Definition [ edit]Risk/return plot and Pareto-optimal portfolios (in red)The term “portfolio” refers to any combination of financial assets such as stocks, bonds and cash. Portfolios may be held by individual investors and/or managed by financial professionals, hedge funds, banks and other financial institutions.

It is a generally accepted principle that a portfolio is designed according to the investor's risk tolerance, time frame and investment objectives. The monetary value of each asset may influence the risk /reward ratio of the portfolio. When determining a proper asset allocation one aims at maximizing the expected return and minimizing the risk.

This is an example of a multi-objective optimization problem: many efficient solutions are available and the preferred solution must be selected by considering a tradeoff between risk and return

[2]Description [ edit]There are many types of portfolios including the market portfolio and the zero-investment portfolio.

[3] A portfolio's asset allocation may be managed utilizing any of the following investment approaches and principles: equal weighting, capitalization-weighting, price-weighting, risk parity, the capital asset pricing model, arbitrage pricing theory, the Jensen Index, the Treynor ratio, the Sharpe diagonal (or index) model, the value at risk model, modern portfolio theory and others.

There are several methods for calculating portfolio returns and performance. One traditional method is using quarterly or monthly money-weighted returns; however, the true time-weighted method is a method preferred by many investors in financial markets.

[4] There are also several models for measuring the performance attribution of a portfolio's returns when compared to an index or benchmark, partly viewed as investment strategy. See also [ edit]Outline of finance § Portfolio theory Capital asset pricing model Infection ratio Investment management References [ edit]^ Investopedia, Portfolio definition and explanation, Retrieved July 2011^ Markowitz, H. M. (March 1952).

""Portfolio Selection"". The Journal of Finance 7 (1): 77-91^ Momentum Investment Strategies, Portfolio Performance, and Herding: A Study of Mutual Fund Behavior. Mark Grinblatt, Sheridan Titman, Russ Wermers The American Economic Review, Vol. 85, No. 5 (Dec., 1995), pp. 1088-1105^ Investment Performance Measurement Errors, accessed 2008-06-29. Categories: Financial markets Investment Personal finance "

dd. Exclusive median The median is excluded from the calculation if N (the number of values in the data) is odd. Tip: To read more about the box and whisker chart and how it helps you visualize statistical data, see this blog post on the histogram, Pareto, and box and whisker chart by the Excel team.

Create a box and whisker chart

A box and whisker chart shows distribution of data into quartiles, highlighting the mean and outliers. The boxes may have lines extending vertically called “whiskers”. These lines indicate variability outside the upper and lower quartiles, and any point outside those lines or whiskers is considered an outlier. Box and whisker charts are most commonly used in statistical analysis. For example, you could use a box and whisker chart to compare medical trial results or teachers' test scores.

Windows Mac Create a box and whisker chart Select your data—either a single data series, or multiple data series. (The data shown in the following illustration is a portion of the data used to create the sample chart shown above.

)In Excel, click Insert > Insert Statistic Chart > Box and Whisker as shown in the following illustration. Important: In Word, Outlook, and Power Point, this step works a little differently: On the Insert tab, in the Illustrations group, click Chart.

In the Insert Chart dialog box, on the All Charts tab, click Box & Whisker. Tips: Use the Design and Format tabs to customize the look of your chart. If you don't see these tabs, click anywhere in the box and whisker chart to add the Chart Tools to the ribbon.

Change box and whisker chart options Right-click one of the boxes on the chart to select that box and then, on the shortcut menu, click Format Data Series. In the Format Data Series pane, with Series Options selected, make the changes that you want. (The information in the chart following the illustration can help you make your choices.

)Series option Description Gap width Controls the gap between the categories. Show inner points Displays the data points that lie between the lower whisker line and the upper whisker line. Show outlier points Displays the outlier points that lie either below the lower whisker line or above the upper whisker line.

Show mean markers Displays the mean marker of the selected series. Show mean line Displays the line connecting the means of the boxes in the selected series. Quartile Calculation Choose a method for median calculation: Inclusive median The median is included in the calculation if N (the number of values in the data) is o

You may also be interested learning more about the other new chart types described in this blog post.

cy. Pareto inefficiency - Pareto efficiency is a situation in which one person can not be made better off without making anyone else worse off.

Inefficiency

"Look up inefficiency in Wiktionary, the free dictionary. The term inefficiency generally refers to an absence of efficiency. It has several meanings depending on the context in which it is used: Allocative inefficiency - Allocative inefficiency is a situation in which the distribution of resources between alternatives does not fit with consumer taste (perceptions of costs and benefits).

For example, a company may have the lowest costs in ""productive"" terms, but the result may be inefficient in allocative terms because the ""true"" or social cost exceeds the price that consumers are willing to pay for an extra unit of the product.

This is true, for example, if the firm produces pollution (see also external cost ). Consumers would prefer that the firm and its competitors produce less of the product and charge a higher price, to internalize the external cost.

Distributive Inefficiency - refers to the inefficient distribution of income and wealth within a society. Decreasing marginal utilities of wealth in theory suggests that more egalitarian distributions of wealth are more efficient than unegalitarian distributions. Distributive inefficiency is often associated with economic inequality. Economic inefficiency - refers to a situation where ""we could be doing a better job,"" i.e., attaining our goals at lower cost.

It is the opposite of economic efficiency. In the latter case, there is no way to do a better job, given the available resources and technology. Keynesian inefficiency - might be defined as incomplete use of resources (labor, capital goods, natural resources, etc.)

because of inadequate aggregate demand. We are not attaining potential output, while suffering from cyclical unemployment. We could do a better job if we applied deficit spending or expansive monetary poli

In practice, this criterion is difficult to apply in a constantly changing world, so many emphasize Kaldor-Hicks efficiency and inefficiency: a situation is inefficient if someone can be made better off even after compensating those made worse off, regardless of whether the compensation actually occurs.

Productive inefficiency - says that we could produce the given output at a lower cost—or could produce more output for given cost.

For example, a company that is inefficient will have higher operating costs and will be at a competitive disadvantage (or have lower profits than other firms in the market). Resource-market inefficiency - refers to barriers that prevent full adjustment of resource markets, so that resources are either unused or misused. For example, structural unemployment results from barriers of mobility in labor markets which prevent workers from moving to places and occupations where there are job vacancies.

Thus, unemployed workers can co-exist with unfilled job vacancies. X-inefficiency - refers to inefficiency in the ""black box"" of production, connecting inputs to outputs. This type of inefficiency says that we could be organizing people or production processes more effectively. Often problems of ""morale"" or "" bureaucratic inertia "" cause X-inefficiency. Productive inefficiency, Resource-market inefficiency and X-inefficiency might be analyzed using Data Envelopment Analysis and similar methods. See also [ edit]Efficiency (disambiguation) "

Cause Analysis Tools Use these tools when you want to conduct root cause analysis for a problem or situation. Fishbone (Ishikawa) diagram: identifies many possible causes for an effect or problem and sorts ideas into useful categories. Pareto chart: shows on a bar graph which factors are more significant.

Cause Analysis Tools

Scatter diagram: graphs pairs of numerical data, with one variable on each axis, to help you look for a relationship.

Excerpted from Nancy R. Tague’s The Quality Toolbox, Second Edition, ASQ Quality Press, 2004. Related Resources on Root Cause Analysis Learn how cause analysis tools can fit into your root cause analysis efforts. Webcast: Root Cause Analysis for Beginners, Part 1 and Part 2 ASQ Fellow Jim Rooney walks you through the basics of root cause analysis.

Case study: Quality Revolution Reduces Defects, Drives Sales Growth at 3M By combining Lean Six Sigma and a Top-200 customer focus, 3M improved its belt fabrication processes, reducing defects in parts per million by a factor of 28 times as sales increased by 54 percent.

Case study: Wind Power Company Gets to the Root of an Icy Issue A root cause analysis project saved Clipper Windpower $1 million in lost revenue while increasing customer satisfaction. Article: Under Scrutiny A new approach to root cause analysis can help clear up misconceptions. Article: Get to the Root of It Use an is/is not comparative analysis tool to pinpoint the problem. More Resources

That holds an important lesson for beginning grant writers (and a useful reminder for veterans): Your grant proposal is never going to be perfect. And it doesn’t need to be. Observe the Pareto Principle . (Commonly stated as: 80% of the return comes from 20% of the effort.

Sample Grant Proposals

Sample Grant Proposals Each document linked below is an example of a successful grant proposal that I prepared. There’s a school of thought that, because every project is unique, there’s not much to be gained from reading old proposals.

I disagree. If you want to master the art of chair-making, study well-made chairs. Similarly, to cultivate the art of successful grant writing, study successful grants. That’s not sufficient, of course. I don’t offer these proposals as platonic templates to be copied.

In fact, as I was prepping the HIV Prevention sample proposal for upload, I noticed several errors. I considered editing the piece then decided against it. These are complicated artifacts, written under deadline pressure.

My corollary: To achieve perfection requires infinite effort. Leave it to the angels. )Welcome to the library!Government Grants: Low-Income Wind Project (PDF) (HTML) (Community Services)AIDS HIV Prevention (Office of Minority Health)Foundation Grants: Breast Cancer Awareness (Marin Community Foundation)Leave a Reply You must be logged in to post a comment.

Conversely, if we leave the cache at 512 KB but increase the system memory to 256 MB, each of the 16,384 cache lines will be shared by 16,384 addresses. There are many areas in the computer world where Pareto's Law applies, and cache size is definitely one of them.

[ The PC Guide | Systems and Components Reference Guide | Motherboard and System Devices | System Cache | Cache Characteristi

cs ]Cache Size The size of the cache normally refers actually to the size of the data store, where the memory elements are actually stored. A typical PC level 2 cache is either 256 KB or 512 KB, but can be as small as 64 KB on older machines, or as high as 1 MB or even 2 MB.

Within processors, level 1 cache usually ranges in size from 8 KB to 64 KB. The more cache the system has, the more likely it is to register a hit on a memory access, because fewer memory locations are forced to share the same cache line. Let's use an example to illustrate (the same one we used when we discussed cache operation in detail .

). We have a system with 64 MB of memory and 512 KB of direct-mapped cache, arranged into 32-byte cache lines. This means that we have 16,384 cache lines (512 K divided by 32). Each line is shared by 4,096 memory addresses (64 MB divided by 16,384). Now if we increase the amount of cache to 1 MB, we will have 32,768 cache lines, and each will only be shared by 2,048 addresses.

Timothy Ferriss gives similar advice in his New York Times bestseller, The 4-Hour Workweek. He stresses the Pareto principle, or the 80/20 law, which is that 80 percent of outputs come from 20 percent of inputs. So stay focused, and you'll do more in less time.

Why Successful People Leave Work Early

"Why Successful People Leave Work Early Aimee Groth May. 4, 2011, 3:26 PM 379,436Try this for a day: don't answer every phone call. Stop checking your email every two minutes. And leave work early. You'll be astounded at how much more you'll get done.

According to a study published in the Psychological Review conducted by Dr. K. Anders Ericcson, the key to great success is working harder in short bursts of time. Then give yourself a break before getting back to work. The trick is staying focused. Ericsson and his team evaluated a group of musicians to find out what the ""excellent"" players were doing differently.

They found that violinists who practiced more deliberately, say for 4 hours, accomplished more than others who slaved away for 7 hours.

The best performers set goals for their practice sessions and required themselves to take breaks. Looking at the chart, you can see that the best violin students practiced with greater intensity just before the lunch hour and then took a break before starting up again at 4 p.m. -- whereas the other students practiced more steadily throughout the entire day.

The researchers found that successful people in other professions had similar habits:""While completing a novel, famous authors tend to write only for 4 hours during the morning, leaving the rest of the day for rest and recuperation.

Hence successful authors, who can control their work habits and are motivated to optimize their productivity, limit their most important intellectual activity to a fixed daily amount when working on projects requiring long periods of time to complete. ""

For more productivity tips check out 9 Ways to Work Less and Do More >More: Strategyfacebook linkedin twitter Recommended For You Powered By Sailthru "

The Pareto optimum provision of a public good in a society is at the level where the combined sum of the marginal rate of substitution between private goods and a given public good of all individuals is equal to the marginal rate of transformation.

Public good

"From Wikipedia, the free encyclopedianavigation search Public infrastructure Grand Coulee Dam Assets and facilities Airports Bridges Broadband Canals Coastal management Critical infrastructure Dams Electricity Energy Hazardous waste Hospitals Irrigation schemes Levees Lighthouses Parks Pipeline transport Ports Mass transit Public housing State schools Public spaces Rail Roads Sewage Sluices Solid waste Telecommunication Utilities Water supply Weirs Wastewater Concepts Asset management Appropriation Lindahl tax Build-Operate-Transfer Design-Build Earmark Fixed cost Engineering contracts Externality Government debt Life-cycle assessment Maintenance Monopoly Property tax Public-private partnership Public capital Public finance Public good Public sector Renovation Replacement (upgrade)Spillover effect Supply chain Taxation Issues and ideas Air traffic control Brownfield Carbon footprint Containerization Congestion pricing Ecotax Ethanol fuel Fuel tax Groundwater High-speed rail Hybrid vehicles Land-use planning Mobile data terminal Pork barrel Rapid bus transit Recycling Renewables Reverse osmosis Smart grid Smart growth Stormwater Urban sprawl Traffic congestion Transit-oriented development Vehicle efficiency Waste-to-energy Weatherization Wireless technology Fields of study Architecture Civil Electrical Mechanical engineering Public economics Public policy Urban planning Examples [show]Infrastructure portalv t e In economics, a public good is a good that is both non-excludable and non-rivalrous in that individuals cannot be effectively excluded from use and where use by one individual does not reduce availability to others.

[1]Gravelle and Rees: ""The defining characteristic of a public good is that consumption of it by one individual does not actually or potentially reduce the amount available to be consumed by another individual.""

In a non-economic sense, the term is often used to describe something that is useful for the public generally, such as education and infrastructure, although these are not ""public goods"" in the economic sense. This is in contrast to a common good which is non-excludable but is rivalrous to a certain degree. Public goods include knowledge, official statistics, national security, common language (s), flood control systems, lighthouses, street lighting, and Wikipedia itself.

Public goods that are available everywhere are sometimes referred to as global public goods. [2] There is an important conceptual difference between the sense of ""a"" public good, or public ""goods"" in economics, and the more generalized idea of ""the public good"" (or common good, or public interest ), ""a shorthand signal for shared benefit at a societal level"".

[3] [4] [5]Many public goods may at times be subject to excessive use resulting in negative externalities affecting all users; for example air pollution and traffic congestion.

Public goods problems are often closely related to the ""free-rider"" problem, in which people not paying for the good may continue to access it. Thus, the good may be under-produced, overused or degraded. [6] Public goods may also become subject to restrictions on access and may then be considered to be club goods or private goods; exclusion mechanisms include copyright, patents, congestion pricing, and pay television.

There is a good deal of debate and literature on how to measure the significance of public goods problems in an economy, and to identify the best remedies. Contents [ hide ]1 Terminology, and types of goods1.1 Definition matrix1.2 Challenges in identifying public goods1.3 Social goods2 Examples3 Free rider problem3.1 Economic and political solutions3.1.1 Assurance contracts3.1.2 Coasian solution3.1.3 Government provision3.1.4 Subsidies and joint products3.1.5 Privileged group3.1.6 Merging free riders3.1.7 Introducing an exclusion mechanism (club goods)3.2 Altruistic solutions3.2.1 Social norms3.2.2 Social sanctions (punishment)3.2.3 Voluntary organizations3.2.4 Religions and ideologies4 Efficient production levels of public goods5 Ownership6 See also7 References8 External links Terminology, and types of goods [ edit]Paul A. Samuelson is usually credited as the first economist to develop the theory of public goods.

In his classic 1954 paper The Pure Theory of Public Expenditure, [7] he defined a public good, or as he called it in the paper a ""collective consumption good"", as follows: [goods] which all enjoy in common in the sense that each individual's consumption of such a good leads to no subtractions from any other individual's consumption of that good...

This is the property that has become known as non-rivalry. A pure public good exhibits a second property called non-excludability: that is, it is impossible to exclude any individuals from consuming the good. However, many goods may satisfy the two public good conditions ( non-rivalry and non-excludability) only to a certain extent or only some of the time.

These goods are known as impure public goods. The opposite of a public good is a private good, which does not possess these properties. A loaf of bread, for example, is a private good; its owner can exclude others from using it, and once it has been consumed, it cannot be used again.

A good that is rivalrous but non-excludable is sometimes called a common-pool resource. Such goods raise similar issues to public goods: the mirror to the public goods problem for this case is sometimes called the "" tragedy of the commons "".

For example, it is so difficult to enforce restrictions on deep sea fishing that the world's fish stocks can be seen as a non-excludable resource, but one which is finite and diminishing. Definition matrix [ edit]Excludable Non-excludable Rivalrous Private goods food, clothing, cars, parking spaces Common-pool resources fish stocks, timber, coal Non-rivalrous Club goods cinemas, private parks, satellite television Public goods free-to-air television, air, national defense V. Ostrom and E. Ostrom proposed additional modifications to the classification of goods to identify fundamental differences that affect the incentives facing individuals [8] (1) Replacing the term ""rivalry of consumption"" with ""subtractability of use"".

(2) Conceptualizing subtractability of use and excludability to vary from low to high rather than characterizing them as either present or absent. (3) Overtly adding a very important fourth type of good—common-pool resources—that shares the attribute of subtractability with private goods and difficulty of exclusion with public goods. Forests, water systems, fisheries, and the global atmosphere are all common-pool resources of immense importance for the survival of humans on this earth.

(4) Changing the name of a ""club"" good to a ""toll"" good since many goods that share these characteristics are provided by small scale public as well as private associations. Challenges in identifying public goods [ edit]The definition of non-excludability states that it is impossible to exclude individuals from consumption. Technology now allows radio or TV broadcasts to be encrypted such that persons without a special decoder are excluded from the broadcast.

Many forms of information goods have characteristics of public goods. For example, a poem can be read by many people without reducing the consumption of that good by others; in this sense, it is non-rivalrous. Similarly, the information in most patents can be used by any party without reducing consumption of that good by others.

Official statistics provide a clear example of information goods that are public goods, since they are created to be non-excludable. Creative works may be excludable in some circumstances, however: the individual who wrote the poem may decline to share it with others by not publishing it.

Copyrights and patents both encourage the creation of such non-rival goods by providing temporary monopolies, or, in the terminology of public goods, providing a legal mechanism to enforce excludability for a limited period of time. For public goods, the ""lost revenue"" of the producer of the good is not part of the definition: a public good is a good whose consumption does not reduce any other's consumption of that good.

[9]Debate has been generated among economists whether such a category of ""public goods"" exists. Steven Shavell has suggested the following:when professional economists talk about public goods they do not mean that there are a general category of goods that share the same economic characteristics, manifest the same dysfunctions, and that may thus benefit from pretty similar corrective solutions...there is merely an infinite series of particular problems (some of overproduction, some of underproduction, and so on), each with a particular solution that cannot be deduced from the theory, but that instead would depend on local empirical factors.

[10]Common confusion is that public goods are goods provided by the public sector. Although it is often the case that government is involved in producing public goods, this is not necessarily the case. Public goods may be naturally available. They may be produced by private individuals and firms, by non-state collective action, or they may not be produced at all.

[ citation needed]The theoretical concept of public goods does not distinguish with regard to the geographical region in which a good may be produced or consumed.

However, some theorists such as Inge Kaul use the term "" global public good "" for public goods which is non-rival and non-excludable throughout the whole world, as opposed to a public good which exists in just one national area. Knowledge has been held to be an example of a global public good, [11] but also as a commons, the knowledge commons.

[12]Aggregate demand (ΣMB) is the sum of individual demands (MBi)Graphically, non-rivalry means that if each of several individuals has a demand curve for a public good, then the individual demand curves are summed vertically to get the aggregate demand curve for the public good. This is in contrast to the procedure for deriving the aggregate demand for a private good, where individual demands are summed horizontally.

Social goods [ edit]Social goods are defined [ by whom?] as public goods that could be delivered as private goods, but are usually delivered by the government for various reasons, including social policy, and funded via public funds like taxes.

Note that some writers have used the term ""public good"" to refer only to non-excludable ""pure public goods"" and refer to excludable public goods as "" club goods "". [13]Examples [ edit]Common examples of public goods include: defence, public fireworks, lighthouses, clean air and other environmental goods, and information goods, such as official statistics, software development, authorship, and invention.

Some goods, like orphan drugs, require special governmental incentives to be produced, but cannot be classified as public goods since they do not fulfill the above requirements (non-excludable and non-rivalrous.)

Law enforcement, streets, libraries, museums, and education are commonly misclassified as public goods, but they are technically classified in economic terms as quasi-public goods because excludability is possible, but they do still fit some of the characteristics of public goods. [14] [15]The provision of a lighthouse is a standard example of a public good, since it is difficult to exclude ships from using its services.

No ship's use detracts from that of others, but since most of the benefit of a lighthouse accrues to ships using particular ports, lighthouse maintenance can be profitably bundled with port fees ( Ronald Coase, The Lighthouse in Economics 1974).

This has been sufficient to fund actual lighthouses. Technological progress can create new public goods. The most simple examples are street lights, which are relatively recent inventions (by historical standards).

One person's enjoyment of them does not detract from other persons' enjoyment, and it currently would be prohibitively expensive to charge individuals separately for the amount of light they presumably use. Official statistics are another example. The government's ability to collect, process and provide high-quality information to guide decision-making at all levels has been strongly advanced by technological progress.

On the other hand, a public good's status may change over time. Technological progress can significantly impact excludability of traditional public goods: encryption allows broadcasters to sell individual access to their programming. The costs for electronic road pricing have fallen dramatically, paving the way for detailed billing based on actual use.

Some question whether defense is a public good. Murray Rothbard argues: "" 'national defense' is surely not an absolute good with only one unit of supply. It consists of specific resources committed in certain definite and concrete ways—and these resources are necessarily scarce. A ring of defense bases around New York, for example, cuts down the amount possibly available around San Francisco.""

[16] Jeffrey Rogers Hummel and Don Lavoie note, ""Americans in Alaska and Hawaii could very easily be excluded from the U. S. government's defense perimeter, and doing so might enhance the military value of at least conventional U. S. forces to Americans in the other forty-eight states. But, in general, an additional ICBM in the U. S. arsenal can simultaneously protect everyone within the country without diminishing its services"".

[17]Public goods are not restricted to human beings. [18] Indeed, it is one aspect of the study of cooperation in biology. [19]Free rider problem [ edit]Main article: Free rider problem Public goods provide a very important example of market failure, in which market-like behavior of individual gain-seeking does not produce efficient results.

The production of public goods results in positive externalities which are not remunerated. If private organizations do not reap all the benefits of a public good which they have produced, their incentives to produce it voluntarily might be insufficient. Consumers can take advantage of public goods without contributing sufficiently to their creation. This is called the free rider problem, or occasionally, the ""easy rider problem"" (because consumers' contributions will be small but non-zero).

If too many consumers decide to ""free-ride"", private costs exceed private benefits and the incentive to provide the good or service through the market disappears. The market thus fails to provide a good or service for which there is a need. [20]The free rider problem depends on a conception of the human being as homo economicus: purely rational and also purely selfish—extremely individualistic, considering only those benefits and costs that directly affect him or her.

Public goods give such a person an incentive to be a free rider. For example, consider national defense, a standard example of a pure public good. Suppose homo economicus thinks about exerting some extra effort to defend the nation. The benefits to the individual of this effort would be very low, since the benefits would be distributed among all of the millions of other people in the country. There is also a very high possibility that he or she could get injured or killed during the course of his or her military service.

On the other hand, the free rider knows that he or she cannot be excluded from the benefits of national defense, regardless of whether he or she contributes to it. There is also no way that these benefits can be split up and distributed as individual parcels to people. The free rider would not voluntarily exert any extra effort, unless there is some inherent pleasure or material reward for doing so (for example, money paid by the government, as with an all-volunteer army or mercenaries ).

The free-riding problem is even more complicated than it was thought to be until recently. Any time non-excludability results in failure to pay the true marginal value (often called the ""demand revelation problem""), it will also result in failure to generate proper income levels, since households will not give up valuable leisure if they cannot individually increment a good.

[21] This implies that, for public goods without strong special interest support, under-provision is likely since benefit-cost analyses are being conducted at the wrong income levels, and all of the ungenerated income would have been spent on the public good, apart from general equilibrium considerations.

In the case of information goods, an inventor of a new product may benefit all of society, but hardly anyone is willing to pay for the invention if they can benefit from it for free. In the case of an information good, however, because of its characteristics of non-excludability and also because of almost zero reproduction costs, commoditization is difficult and not always efficient even from a neoclassical economic point of view.

[22]Economic and political solutions [ edit]Assurance contracts [ edit]Main article: Assurance contract An assurance contract is a contract in which participants make a binding pledge to contribute to building a public good, contingent on a quorum of a predetermined size being reached.

Otherwise the good is not provided and any monetary contributions are refunded. A dominant assurance contract is a variation in which an entrepreneur creates the contract and refunds the initial pledge plus an additional sum of money if the quorum is not reached.

(The entrepreneur profits by collecting a fee if the quorum is reached and the good is provided.) In game-theoretic terms this makes pledging to build the public good a dominant strategy: the best move is to pledge to the contract regardless of the actions of others.

[23]Coasian solution [ edit]A Coasian solution, named for the economist Ronald Coase, proposes that potential beneficiaries of a public good can negotiate to pool their resources and create it, based on each party's self-interested willingness to pay.

His treatise, ""The Problem of Social Cost"" (1960), argued that if the transaction costs between potential beneficiaries of a public good are low—that it is easy for potential beneficiaries to find each other and organize a pooling their resources based upon the good's value to each of them—that public goods could be produced without government action.

[24]Much later, Coase himself wrote that while what had become known as the Coase Theorem had explored the implications of zero transaction costs, he had actually intended to use this construct as a stepping-stone to understand the real world of positive transaction costs, corporations, legal systems and government actions: [25] [26]I examined what would happen in a world in which transaction costs were assumed to be zero. My aim in doing so was not to describe what life would be like in such a world but to provide a simple setting in which to develop the analysis and, what was even more important, to make clear the fundamental role which transaction costs do, and should, play in the fashioning of the institutions which make up the economic system.

Coase also wrote: The world of zero transaction costs has often been described as a Coasian world. Nothing could be further from the truth. It is the world of modern economic theory, one which I was hoping to persuade economists to leave.

What I did in ""The Problem of Social Cost"" was simply to shed light on some of its properties. I argued in such a world the allocation of resources would be independent of the legal position, a result which Stigler dubbed the ""Coase theorem.

[27]Thus, while Coase himself appears to have considered the ""Coase theorem"" and Coasian solutions as simplified constructs to ultimately consider the real 20th-century world of governments and laws and corporations, these concepts have become attached to a world where transaction costs were much lower, and government intervention would unquestionably be less necessary.

A minor alternative, especially for information goods, is for the producer to refuse to release a good to the public until payment to cover costs is met.

Author Stephen King, for instance, authored chapters of a new novel downloadable for free on his website while stating that he would not release subsequent chapters unless a certain amount of money was raised.

Sometimes dubbed holding for ransom, this method of public goods production is a modern application of the street performer protocol for public goods production. Unlike assurance contracts, its success relies largely on social norms to ensure (to some extent) that the threshold is reached and partial contributions are not wasted. One of the purest Coasian solutions today is the new phenomenon of Internet crowdfunding. Here rules are enforced by computer algorithms and legal contracts as well as social pressure.

For example, on the Kickstarter site, each funder authorizes a credit card purchase to buy a new product or receive other promised benefits, but no money changes hands until the funding goal is met.

[28] Because automation and the Internet so reduce the transaction costs for pooling resources, project goals of only a few hundred dollars are frequently crowdfunded, far below the costs of soliciting traditional investors. Other crowdfunded projects have raised over a million dollars, like the Arkyd-100 space satellite telescope funded on Kickstarter in June 2013. [29] It would seem to be a clear instance of a Coase solution when a public good that always required government sponsorship in the 20th century can be efficiently organized from 18,000 individuals' self-interest (including rewards such as an orbital ""selfie"", and five minutes of observation time donated in their name to find potential killer asteroids).

Government provision [ edit]If voluntary provision of public goods will not work, then the obvious solution is making their provision involuntary. This saves each of us from our own tendency to be a free rider, while also assuring us that no one else will be allowed to free ride. One frequently proposed solution to the problem is for governments or states to impose taxation to fund the production of public goods. This does not actually solve the theoretical problem because good government is itself a public good.

Thus it is difficult to ensure the government has an incentive to provide the optimum amount even if it were possible for the government to determine precisely what amount would be optimum. These issues are studied by public choice theory and public finance. Sometimes the government provides public goods using ""unfunded mandates"". An example is the requirement that every car be fit with a catalytic converter. This may be executed in the private sector, but the end result is predetermined by the state: the individually involuntary provision of the public good clean air.

Unfunded mandates have also been imposed by the U. S. federal government on the state and local governments, as with the Americans with Disabilities Act, for example. Regardless the role of the government is provide vital goods to all individuals, some of which they cannot obtain on themselves. [30] In order to ensure that government services are properly funded taxes and other government controlled entities are enforced. [31] Although enforced taxes deter the free-rider problem many contend that some goods should be excluded and made into private goods.

However, this not possible with all goods such as pure public goods that are inseparable and inclusive, thus require ""provision by public means"". [32] In short, the government has a responsibility to ensure that the social welfare of individuals is met as opposed to privatized goods.

[33]Subsidies and joint products [ edit]A government may subsidize production of a public good in the private sector. Unlike government provision, subsidies may result in some form of a competitive market. The potential for cronyism (for example, an alliance between political insiders and the businesses receiving subsidies) can be limited with secret bidding for the subsidies or application of the subsidies following clear general principles.

Depending on the nature of a public good and a related subsidy, principal–agent problems can arise between the citizens and the government or between the government and the subsidized producers; this effect and counter-measures taken to address it can diminish the benefits of the subsidy. Subsidies can also be used in areas with a potential for non-individualism: For instance, a state may subsidize devices to reduce air pollution and appeal to citizens to cover the remaining costs. Similarly, a joint-product model analyzes the collaborative effect of joining a private good to a public good.

For example, a tax deduction (private good) can be tied to a donation to a charity (public good). It can be shown that the provision of the public good increases when tied to the private good, as long as the private good is provided by a monopoly (otherwise the private good would be provided by competitors without the link to the public good).

Privileged group [ edit]The study of collective action shows that public goods are still produced when one individual benefits more from the public good than it costs him to produce it; examples include benefits from individual use, intrinsic motivation to produce, and business models based on selling complement goods.

A group that contains such individuals is called a privileged group. A historical example could be a downtown entrepreneur who erects a street light in front of his shop to attract customers; even though there are positive external benefits to neighboring nonpaying businesses, the added customers to the paying shop provide enough revenue to cover the costs of the street light.

The existence of privileged groups may not be a complete solution to the free rider problem, however, as underproduction of the public good may still result. The street light builder, for instance, would not consider the added benefit to neighboring businesses when determining whether to erect his street light, making it possible that the street light isn't built when the cost of building is too high for the single entrepreneur even when the total benefit to all the businesses combined exceeds the cost.

An example of the privileged group solution could be the Linux community, assuming that users derive more benefit from contributing than it costs them to do it. For more discussion on this topic see also Coase's Penguin. Another example is those musicians and writers who create music and writings for their own personal enjoyment, and publish because they enjoy having an audience.

Financial incentives are not necessary to ensure the creation of these public goods. Whether this creates the correct production level of writings and music is an open question.

Merging free riders [ edit]Another method of overcoming the free rider problem is to simply eliminate the profit incentive for free riding by buying out all the potential free riders. A property developer that owned an entire city street, for instance, would not need to worry about free riders when erecting street lights since he owns every business that could benefit from the street light without paying.

Implicitly, then, the property developer would erect street lights until the marginal social benefit met the marginal social cost.

In this case, they are equivalent to the private marginal benefits and costs. While the purchase of all potential free riders may solve the problem of underproduction due to free riders in smaller markets, it may simultaneously introduce the problem of underproduction due to monopoly. Additionally, some markets are simply too large to make a buyout of all beneficiaries feasible—this is particularly visible with public goods that affect everyone in a country.

Introducing an exclusion mechanism (club goods) [ edit]Another solution, which has evolved for information goods, is to introduce exclusion mechanisms which turn public goods into club goods. One well-known example is copyright and patent laws. These laws, which in the 20th century came to be called intellectual property laws, attempt to remove the natural non-excludability by prohibiting reproduction of the good.

Although they can address the free rider problem, the downside of these laws is that they imply private monopoly power and thus are not Pareto-optimal. For example, in the United States, the patent rights given to pharmaceutical companies encourage them to charge high prices (above marginal cost) [ dubious – discuss] and to advertise to convince patients to persuade their doctors to prescribe the drugs.

[ dubious – discuss] Likewise, copyright provides an incentive for a publisher to act like The Dog in the Manger, taking older works out of print so as not to cannibalize revenue from the publisher's own new works. [34]This article's factual accuracy is disputed. Relevant discussion may be found on the talk page.

Please help to ensure that disputed statements are reliably sourced. (August 2011) ( Learn how and when to remove this template message)The laws also end up encouraging patent and copyright owners to sue even mild imitators in court and to lobby for the extension of the term of the exclusive rights in a form of rent seeking.

These problems with the club-good mechanism arise because the underlying marginal cost of giving the good to more people is low or zero, but, because of the limits of price discrimination those who are unwilling or unable to pay a profit-maximizing price do not gain access to the good. If the costs of the exclusion mechanism are not higher than the gain from the collaboration, club goods can emerge naturally.

James M. Buchanan showed in his seminal paper that clubs can be an efficient alternative to government interventions. On the other hand, the inefficiencies and inequities of club goods exclusions sometimes cause potentially excludable club goods to be treated as public goods, and their production financed by some other mechanism.

Examples of such ""natural"" club goods include natural monopolies with very high fixed costs, private golf courses, cinemas, cable television and social clubs.

This explains why many such goods are often provided or subsidized by governments, co-operatives or volunteer associations, rather than being left to be supplied by profit-minded entrepreneurs. These goods are often known as social goods. Joseph Schumpeter claimed that the ""excess profits"", or profits over normal profit, generated by the copyright or patent monopoly will attract competitors that will make technological innovations and thereby end the monopoly.

This is a continual process referred to as ""Schumpeterian creative destruction "", and its applicability to different types of public goods is a source of some controversy.

The supporters of the theory point to the case of Microsoft, for example, which has been increasing its prices (or lowering its products' quality), predicting that these practices will make increased market shares for Linux and Apple largely inevitable.

[ citation needed]A nation can be seen as a club whose members are its citizens. Government would then be the manager of this club. This is further studied in the Theory of the State. Altruistic solutions [ edit]Social norms [ edit]This section is written like a personal reflection or opinion essay that states a Wikipedia editor's personal feelings about a topic. Please help improve it by rewriting it in an encyclopedic style. (February 2017) ( Learn how and when to remove this template message)When enough people do not think like free-riders, the private and voluntary provision of public goods may be successful.

For example, a free rider might come to a public park to enjoy its beauty, yet discard litter that makes it less enjoyable for others.

Other public-spirited individuals don't do this and might even pick up existing litter. There could be many non-self-interested reasons to do this: One can derive pleasure from helping their community One may feel ashamed if their neighbors or friends saw them One could be emotionally attached to the public good Good or bad social behavior is contagious: people unconsciously adapt their behavior to that of their peers.

In psychology, this is known as conformity. Even people who engaged in free-riding by littering elsewhere are less likely to if they see others hold on to their trash.

Social norms can also be observed everywhere people interact, not only in physical spaces but in virtual communities on the Internet. Lawrence Lessig describes how social norms can regulate behavior in cyberspace: through an individual's perceptions from the (physical or virtual) surrounding community. For example, if a disabled person boards a crowded bus, everyone expects that some able-bodied person will volunteer their seat.

The same social norm, although executed in a different environment, can also be applied to the Internet. If a user enters a discussion in a chat room and continues to use all capital letters or to make personal attacks (""flames"") when addressing other users, the culprit may realize he or she has been blocked by other participants.

As in real life, users learning to adapt to the social norms of cyberspace communities provide a public good—here, not suffering disruptive online behavior—for all the participants. Social sanctions (punishment) [ edit]Experimental literature suggests that free riding can be overcome without any state intervention. Peer-to-peer punishment, that is, members sanction those members that do not contribute to the public good at a cost, is sufficient to establish and maintain cooperation.

[35] [36] Such punishment is often considered altruistic, because it comes at a cost to the punisher, however, the exact nature remains to be explored. [37] Whether costly punishment can explain cooperation is disputed. [38] Recent research finds that costly punishment is less effective in real world environments. For example, punishment works relatively badly under imperfect information, where people cannot observe the behavior of other perfectly.

[39]Voluntary organizations [ edit]Organizations such as the Red Cross, public radio and television or a volunteer fire department provide public goods to the majority at the expense of a minority who voluntarily participate or contribute funds.

Contributions to online collaborative media like Wikipedia and other wiki projects, and free software projects such as Linux are another example of relatively few contributors providing a public good (information) freely to all readers or software users. Proposed explanations for altruistic behavior include biological altruism and reciprocal altruism.

For example, voluntary groups such as labor unions and charities often have a federated structure, probably in part because voluntary collaboration emerges more readily in smaller social groups than in large ones (e.g., see Dunbar's number ). While both biological and reciprocal altruism are observed in other animals, our species' complex social behaviors take these raw materials much farther.

Philanthropy by wealthy individuals—some, such as Andrew Carnegie giving away their entire vast fortunes—have historically provided a multitude of public goods for others. One major impact was the Rockefeller Foundation 's development of the "" Green Revolution "" hybrid grains that probably saved many millions of people from starvation in the 1970s.

Christian missionaries, who typically spend large parts of their lives in remote, often dangerous places, have had disproportionate impact compared with their numbers worldwide for centuries.

Communist revolutionaries in the 20th century had similar dedication and outsized impacts. International relief organizations such as Doctors Without Borders, Save the Children and Amnesty International have benefited millions, while also occasionally costing workers their lives. For better and for worse, humans can conceive of, and sacrifice for, an almost infinite variety of causes in addition to their biological kin.

Religions and ideologies [ edit]""The noblest motive is the public good."" Thomas Jefferson Building, Library of Congress. Voluntary altruistic organizations often motivate their members by encouraging deep-seated personal beliefs, whether religious or other (such as social justice or environmentalism) that are taken ""on faith"" more than proved by rational argument.

When individuals resist temptations to free riding (e.g., stealing) because they hold these beliefs (or because they fear the disapproval of others who do), they provide others with public goods that might be difficult or impossible to ""produce"" by administrative coercion alone. One proposed explanation for the ubiquity of religious belief in human societies is multi-level selection: altruists often lose out within groups, but groups with more altruists win.

A group whose members believe a ""practical reality"" that motivates altruistic behavior may out-compete other groups whose members' perception of ""factual reality"" causes them to behave selfishly.

A classic example is a soldier's willingness to fight for his tribe or country. Another example given in evolutionary biologist David Sloan Wilson 's Darwin's Cathedral is the early Christian church under the late Roman Empire; because Roman society was highly individualistic, during frequent epidemics many of the sick died not of the diseases per se but for lack of basic nursing.

Christians, who believed in an afterlife, were willing to nurse the sick despite the risks. Although the death rate among the nurses was high, the average Christian had a much better chance of surviving an epidemic than other Romans did, and the community prospered.

Religious and non-religious traditions and ideologies (such as nationalism and patriotism) are in full view when a society is in crisis and public goods such as defense are most needed. Wartime leaders invoke their God's protection and claim that their society's most hallowed traditions are at stake. For example, according to President Abraham Lincoln 's Gettysburg Address during the American Civil War, the Union was fighting so ""that government of the people, by the people, for the people, shall not perish from the earth"".

Such voluntary, if exaggerated, exhortations complement forcible measures—taxation and conscription—to motivate people to make sacrifices for their cause. Efficient production levels of public goods [ edit]This article is written like a personal reflection or opinion essay that states a Wikipedia editor's personal feelings about a topic.

Please help improve it by rewriting it in an encyclopedic style. (November 2013) ( Learn how and when to remove this template message)

The Pareto optimum provision of a public good in a society is at the level where the combined sum of the marginal rate of substitution between private goods and a given public good of all individuals is equal to the marginal rate of transformation.

This contrasts to the Pareto optimality condition of private goods, in which each consumers' marginal rate of substitution is equal; as is the societies marginal rate of transformation. [40]When should a public good be provided? Take, for example, a community of just two consumers and the government is considering whether or not to build a public park. Arthur is prepared to pay up to $200 for its use, while Julia is willing to pay up to $100. The total value to the two individuals of having the park is $300.

If it can be produced for $225, there is a $75 gain on its production since it provides services that the community values at $300 at a cost of only $225. Regardless of the method of providing public goods, the efficient level of such provision is still being subjected to economic analysis. For instance, the Samuelson condition calculates the efficient level of public goods production to be where the ratio of the marginal social cost of public and private goods production equals the ratio of the marginal social benefit of public and private goods production.

""If the amount of a public good can be varied continuously, the optimal quantity to produce is that quantity for which the marginal cost of the last unit is just equal to the sum of the prices that all consumers would be willing to pay for that unit."" This equilibrium guarantees that the last unit of the public good costs as much to produce as the value that it gives to all of its consumers. Ownership [ edit]An important question regarding public goods is whether they should be owned by the public or the private sector.

Economic theorists such as Hart (1995) argue that ownership matters for investment incentives when contracts are incomplete. [41] The incomplete contracting paradigm has been applied to public goods by Besley and Ghatak (2001). [42] They consider the government and a non-governmental organization (NGO) who can both make investments to provide a public good. Who should be the owner of the public good, the government or the NGO? Besley and Ghatak show that the party who has a larger valuation for the public good should be the owner, regardless of whether the government or the NGO has a better investment technology.

This result contrasts with the case of private goods studied by Hart (1995), where the party with the better investment technology should be the owner.

However, more recently it has been shown that the investment technology matters also in the public-good case when a party is indispensable or when there are bargaining frictions between the government and the NGO. [43] [44]See also [ edit]Lindahl tax, a method proposed by Erik Lindahl for financing public goods Private-collective model of innovation, which explains the creation of public goods by private investors Public bad Public goods game, a standard of experimental economics Public works, government-financed constructions Tragedy of the anticommons Anti-rival good Rivalry (economics)References [ edit]^ For current definitions of public goods see any mainstream microeconomics textbook, e.g.

: Hal R. Varian, Microeconomic Analysis ISBN 0-393-95735-7; Andreu Mas-Colell, Whinston & Green, Microeconomic Theory ISBN 0-19-507340-1; or Gravelle & Rees, Microeconomics ISBN 0-582-40487-8.^ Cowen, Tyler (December 2007).

David R. Henderson, ed. The Concise Encyclopedia of Economics. Public Goods. The Library of Economics and Liberty.^ Morrell K (2009). ""Governance and the public good"". Public Administration. 87 (3): 538–56 (quote at p 543). doi: 10.1111/j.1467-9299.2009.01756.x.^ Goodsell, C. T. (1990).

Public Administration and the Public Interest’ in G. L. Wamsley and J. F. Wolf (eds), Refounding Public Administration: Modern Paradoxes. Postmodern Challenges. (paperback ed.). Sage. pp. 96–113.^ Morrell K & Harrington-Buhay N (2012). ""What is governance in the public interest? The case of the 1995 property forum in post-conflict Nicaragua"". Public Administration. 90 (2): 412–28. doi: 10.1111/j.1467-9299.2011.01977.x.^ Rittenberg and Tregarthen. Principles of Microeconomics, Chapter 6, Section 4. p. 2, Accessed June 20, 2012^ Samuelson, Paul A.

(1954). ""The Pure Theory of Public Expenditure"". Review of Economics and Statistics. 36 (4): 387–89. doi: 10.2307/1925895. JSTOR 1925895. See also Samuelson, Paul A. (1955). ""Diagrammatic Exposition of a Theory of Public Expenditure"".

Review of Economics and Statistics. 37 (4): 350–56. doi: 10.2307/1925849. JSTOR 1925849.^ Elinor, Ostrom (2005). understanding Institutional Diversity. Princeton, NJ: Princeton University Press.^ Demsetz, Harold (October 1970). ""Full Access The Private Production of Public Goods"". Journal of Law and Economics. 13 (2): 293–306. doi: 10.1086/466695. JSTOR 229060.^ Boyle, James (1996). Shamans, Software, and Spleens: Law and the Construction of the Information Society.

Cambridge, Mass. : Harvard University Press. p. 268. ISBN 0-674-80522-4.^ Joseph E. Stiglitz, ""Knowledge as a Global Public Good"" in Global Public Goods, ISBN 978-0-19-513052-2^ Hess, Charlotte; Ostrom, Elinor (2007). Understanding Knowledge as a Commons: From Theory to Practice. Cambridge: Massachusetts Institute of Technology. pp. 12–13. ISBN 978-0-262-08357-7.^ James M. Buchanan (February 1965). ""An Economic Theory of Clubs"". Economica. Blackwell Publishing. 32 (125): 1–14. doi: 10.2307/2552442. JSTOR 2552442.^ Pucciarelli F., Andreas Kaplan (2016) Competition and Strategy in Higher Education: Managing Complexity and Uncertainty, Business Horizons, Volume 59^ Campbell R. Mc Connell; Stanley L. Brue; Sean M. Flynn (2011).

Economics: Principles, Problems, and Policies (19th ed.). Mc Graw-Hill/Irwin. p. 104. ISBN 978-0-07-351144-3.^ ""Books / Digital Text"".^ Hummel, Jeffrey Rogers & Lavoie, Don. ""National Defense and the Public-Goods Problem"".^ Julou, Thomas; Mora, Thierry; et al. (2013). ""Cell–cell contacts confine public goods diffusion inside Pseudomonas aeruginosa clonal microcolonies"". Proceedings of the National Academy of Sciences of the United States of America. 110 (31): 12–577–12582.

doi: 10.1073/pnas.1301428110. PMC 3732961. PMID 23858453.^ West SA, Griffin AS, Gardner A (2007). ""Evolutionary explanations for cooperation"". Current Biology. 17 (16): R661–R672. doi: 10.1016/j.cub.2007.06.004. PMID 17714660.^ Ray Powell (June 2008). ""10: Private goods, public goods and externalities"". AQA AS Economics (paperback ed.).

Philip Allan. p. 352. ISBN 978-0-340-94750-0.^ Graves, P. E., ""A Note on the Valuation of Collective Goods: Overlooked Input Market Free Riding for Non-Individually Incrementable Goods "", The B. E. Journal of Economic Analysis & Policy 9.1 (2009).^ Babe, Robert (1995).

""Chapter 3"". Essay in Information, Public Policy and Political Economy. University of Ottawa: Westview Press.^ http://mason.gmu.edu/~atabarro/Private Provision.pdf^ Coase, Ronald (October 1960). ""The Problem of Social Cost"". Journal of Law and Economics. 3: 1–44. doi: 10.1086/466560.^ Fox, Glenn. ""The Real Coase Theorems"" (PDF). Cato Journal 27, Fall 2007. Cato Institute, Washington, D. C. Archived from the original (PDF) on 23 July 2013.

Retrieved 17 February 2014.^ Coase, Ronald (1988). The Firm, the Market and the Law. Chicago, Illinois: University of Chicago Press. p. 13.^ Coase, Ronald (1988). The Firm, the Market and the Law. Chicago, Illinois: University of Chicago Press. p. 174.^ ""Kickstarter FAQ"". Retrieved 17 February 2014.^ ""ARKYD: A Space Telescope for Everyone"".

Retrieved 17 February 2014.^ Thompson, Donald. ""The Proper Role of Government: Considering Public Goods and Private Goods"". The Pennsylvania State University, 2015^ Jakacky, Gary. ""The Role of Government in Providing"". Newsmax Finance, 2016^ Jackson, Bill. ""Public Goods and Services"". The Social Studies Help Center, 2016^ Holtz, Brian. ""The Proper Role of Government"".

Holtz for Congress, 2016^ Examples from the entertainment industry include Walt Disney Studios Home Entertainment 's "" vault "" sales practice and its outright refusal to issue Song of the South on home video in most markets.

Examples from the computer software industry include Microsoft 's decision to pull Windows XP from the market in mid-2008 to drive revenue from the widely criticized Windows Vista operating system.^ Elinor Ostrom; James Walker; Roy Gardner (June 1992). ""Covenants With and without a Sword: Self-Governance Is Possible"". American Political Science Review. 86 (2): 404–17. doi: 10.2307/1964229.^ Fehr, E., & S. Gächter (2000) ""Cooperation and Punishment in Public Goods Experiments"", 90 American Economic Review 980.^ Fehr, Ernst; Gächter, Simon (2002). ""Altruistic punishment in humans"". Nature. 415 (6868): 137–40. doi: 10.1038/415137a.^ Dreber, Anna; et al. (2008). ""Winners don't punish"". Nature. 452 (7185): 348–51. doi: 10.1038/nature06723.^ Kristoffel Grechenig, Nicklisch; Thöni, C. (2010).

""Punishment despite reasonable doubt – a public goods experiment with sanctions under uncertainty"". Journal of Empirical Legal Studies. 7 (4): 847–67. doi: 10.1111/j.1740-1461.2010.01197.x. SSRN 1586775.^ Brown, C. V.; Jackson, P. M. (1986), ""The Economic Analysis of Public Goods"", Public Sector Economics, 3rd Edition, Chapter 3, pp. 48–79.^ Hart, Oliver (1995). Firms, Contracts, and Financial Structure. Oxford University Press.^ Besley, Timothy; Ghatak, Maitreesh (2001). ""Government Versus Private Ownership of Public Goods"". The Quarterly Journal of Economics. 116 (4): 1343–72. doi: 10.1162/003355301753265598. ISSN 0033-5533.^ Halonen-Akatwijuka, Maija (2012). ""Nature of human capital, technology and ownership of public goods"".

Journal of Public Economics. Fiscal Federalism. 96 (11–12): 939–45. doi: 10.1016/j.jpubeco.2012.07.005.^ Schmitz, Patrick W. (2015). ""Government versus private ownership of public goods: The role of bargaining frictions"". Journal of Public Economics. 132: 23–31. doi: 10.1016/j.jpubeco.2015.09.009. Nicola Acocella (2006), ‘ Distributive issues in the provision and use of global public goods ’, in: ‘ Studi economici ’, 88 (1): 23-42. Ronald Coase (1974). ""The Lighthouse in Economics"". Journal of Law and Economics. 17 (2): 357–376. doi: 10.1086/466796. Richard Lipsey (2008). ""Economics"" (11): 281–283. Jonathan Zittrain, The Future of the Internet: And How to Stop It. 2008Lawrence Lessig, Code 2.0, Chapter 7, What Things Regulate External links [ edit]Jonathan Anomaly Public Goods and Government Action, Politics, Philosophy, and Economics. 2015. Public Goods: A Brief Introduction, by The Linux Information Project (LINFO)Cowen, Tyler (2008). ""Public Goods"". In David R. Henderson. Concise Encyclopedia of Economics (2nd ed.). Indianapolis: Library of Economics and Liberty. ISBN 978-0-86597-665-8. OCLC 237794267. Global Public Goods – analysis from Global Policy Forum The Nature of Public Goods Hardin, Russell, ""The Free Rider Problem"", The Stanford Encyclopedia of Philosophy (Spring 2013 Edition), Edward N. Zalta (ed. )Requier-Desjardins and Caron Patrick, 2005. Is combating desertification a global public good? Elements of an answer... Les dossiers thématiques du CSFD. Issue 1. 32 pp. Business and economics portal [ show]v t e Types of goods [ show]v t e Public infrastructure [ show]v t e Microeconomics [ show]v t e Economics Categories: Community building Goods (economics) Market failure Public economics Public sphere "

The ABC Priority Method- To-do list The Pareto Principle - 20% of items give 80% of the results The Covey Matrix - Place each of your tasks into one of the four quadrants

ALS Distance Learning Course - Military Professional (In process, not complete)

51 terms Blue Shadow Ops ALS Distance Learning Course - Military Professional (In process, not complete)ALS CDC ALDLC Airmen Leadership Distance Learning Course Learn Flashcards Write Spell Test Match Gravity Advertisement Upgrade to remove ads Sort AFI 36-2618 The Enlisted Force Structure Air Force Doctrine Document (AFDD) 1-1 Leadership and Force Development Time Management Effectively using your time by setting goals and objectives to help you get the most from your resources and accomplish the mission List three time management plans The ABC Priority Method The Pareto Principle The Covey Time Management Matrix Describe each plan

What two steps are essential to ANY time management plan? Make a To-do list and Prioritize your tasks List several time management tools Calendars, Organizers, Personal Planners, PDAs, Smart Phones What types of items should be delegated? Priority ―C‖ tasks, Priority items that are urgent but not difficult How can you take command of the telephone?

Don't depend solely on messages left, No more telephone tag, Call scheduling, Work with others, Voicemail and answering machines Identify 2 examples of the early use of air power military ballooning, air machines, Aeroplane No. 14 operations the Air Force has participated in since, 1990 Desert Storm, Provide Relief, Restore Hope, Allied Force, Enduring Freedom List 4 Air Force Medal of Honor recipients Airman First Class William Pitsenbarger Airman First Class John L. Levitow Staff Sergeant Henry Erwin Staff Sergeant Maynard H. Smith Technical Sergeant Forrest Vosler Staff Sergeant Archibald Mathies Chief Master Sergeant Richard Etchberger What Air Force Manual (AFM) or Air Force Instruction (AFI) governs Dress and Appearance?

AFI 36-2903How do Dress and Appearance support Air Force culture? Provides standardization and teamwork How far back does the origin of Dress and Appearance standards date?

1775, when Gen George Washington commanded the Continental Army Why is it important for military members to show respect to the Flag? It honors our military heritage and shows an appreciation for freedom What Air Force Manual (AFM) or Air Force Instruction (AFI) governs Drill and Ceremonies?

AFM 36-2203Heritage something that is passed down from preceding generations; a tradition August 1907 US Army Signal Corps established a small Aeronautical Division The first military unit of the US Army devoted exclusively to aviation? 1st Aero Squadronfirst female pilot allowed to wear the US Army uniform in 1917? Ruth Lawfirst woman in the Air Force Esther Blake, 1947first American ace sergeant pilot in 1917, Private Frederick Libbyfirst black pilot/fighter pilot Corporal Eugene Bullard in 1917When the department of the Air Force was created 26 July 1947Customs practices that are the result of the need for order and discipline and are established by frequent use over a long period.

Courtesies marks of respect, etiquette, or courteous behavior shown to persons or symbols. Define wellness a complete advancement towards treating the mind, body, and spirit as a whole. AFI 36-2905 Fitness Programfour dimensions of wellness Social dimension deals with your network of friends and personal relationships with those you care about. Emotional dimension refers to building an awareness of and accepting your feelings and moods. Spiritual dimension is that within us which motivates us in life and gives us strength and resiliency.

Physical dimension refers to weight control, a balanced and healthy diet, appearance, self image, and exercisewhy being totally fit impacts mission accomplishment?

increases your ability to influence and lead your subordinatespurpose of the Air Force Fitness Program motivate all members to participate in a year-round physical conditioning program that emphasizes total fitness to include proper aerobic conditioning, strength/flexibility training, and healthy eating5 key players of the Air Force Fitness Program Fitness Assessment Cell Unit Fitness Program Manager Immediate Supervisor Physical Training Leader Individual Fitness Improvement Program a unit-based or fitness center-based program that all members receiving an ―Unsatisfactory‖ fitness score are required to attend Healthy Living Program targets nutritional and exercise behavior changes to improve the members' health and fitnessfactors of proper weight management Aerobic Fitness Muscular Fitness Flexibility Body Compositionfour basic eating rules Eat small frequent meals.

Eat every 3-4 hours (3 meals per day minimum). Eat as soon as possible after exercise. Consume a variety of foodsnot eating frequently throughout the day may affect you by: Slow metabolism Overeating Reduce physical performance Reduce mental performancebehaviors not recommended to achieve optimal fitness Weigh yourself daily Use diuretics or laxatives Spend an excessive amount of time in saunas Participate in extremely low calorie diets Define stress Stress is any circumstance (stressor) that places special physical and/or psychological demands on an organism leading to physiological, psychological, and behavioral outcomes.difference between eustress and distress?

Eustress is the positive consequence of stress and distress is the negative consequence of stresssubcategories of organizational stressors job, role, environmental, interpersonal, leadership, organizational structure, and changemajor types of extra-organizational stressors family problems, marital issues, and financial issues4 stress reaction/condition types physical, psychological, behavioral, and cognitive Post-Traumatic Stress Disorder (PTSD) a disorder diagnosed by psychologists/psychiatrist; diagnosed for people who have experienced a traumatic event in or out of combat and have problems coping and causes significant organizational, extra-organizational, rational, relationship, and interpersonal disturbances that causes depression3 ways to intervene and adapt to combat and operational stress to prevent PTSD In order to intervene and adapt to combat and operational stress to prevent PTSD you can accept the fact of being in the military and prepare for the worse, understand that fear is normal, try to prevent fear so intense that it controls you (training to survive), communicate feelings and thoughts with others, reduce continuous exposure to the trauma, and seek professional help immediatelythree behaviors associated with suicide suicidal gesture, attempted suicide, and completed suicide List ways a supervisor can keep suicide prevention a continuous process within the work center You can keep up a continuous process by keeping open communication with the subordinate and family, ensuring new members and family attend budget, parenting, and stress courses, addressing the topic in performance feedback sessions, addressing the topic at Commander's Call, making frequent face-to-face contact with your subordinates, and bonding with your Airmen through workcenter activities, meetings, and unannounced visits to shift workersthree ways an attempted or completed suicide affects the workcenter and family An attempted suicide or completed suicide can affect the workcenter by causing copy cat attempts, division within the workcenter and lower morale.

If the suicide was completed in the workcenter, people may be afraid to go to the same area and/or accept blame for not noticing the warning signs.

If the individual had a family, they may need professional counseling or financial aidactual impacts of going to Mental Health for assistance? those people who self-refer have a positive career outcome. They may be rehabilitated (if possible) and returned back to normal routinesadditional referrals you could use to provide assistance in stressful situations Your leadership, first sergeant, commander, mental health services, and chaplain are resources you can use to provide additional assistance in stressful situations

Histogram or Bar Graph Check Lists Check Sheets Pareto Principle The Pareto principle suggests that most effects come from relatively few causes. In quantitative terms: 80% of the problems come from 20% of the causes (machines, raw materials, operators etc. ); 80% of the wealth is owned by 20% of the people etc.

TQM Tools

TQM Tools Here follows a brief description of the basic set of Total Quality Management tools. They are: Pareto Principle Scatter Plots Control Charts Flow Charts Cause and Effect , Fishbone, Ishikawa Diagram

Therefore effort aimed at the right 20% can solve 80% of the problems. Double (back to back) Pareto charts can be used to compare 'before and after' situations. General use, to decide where to apply initial effort for maximum effect. Scatter Plots A scatter plot is effectively a line graph with no line - i.e. the point intersections between the two data sets are plotted but no attempt is made to physically draw a line.

The Y axis is conventionally used for the characteristic whose behaviour we would like to predict. Use, to define the area of relationship between two variables. Warning: There may appear to be a relationship on the plot when in reality there is none, or both variables actually relate independently to a third variable.

Control Charts Control charts are a method of Statistical Process Control, SPC. (Control system for production processes). They enable the control of distribution of variation rather than attempting to control each individual variation.

Upper and lower control and tolerance limits are calculated for a process and sampled measures are regularly plotted about a central line between the two sets of limits. The plotted line corresponds to the stability/trend of the process. Action can be taken based on trend rather than on individual variation.

This prevents over-correction/compensation for random variation, which would lead to many rejects. Flow Charts Pictures, symbols or text coupled with lines, arrows on lines show direction of flow. Enables modelling of processes; problems/opportunities and decision points etc.

Develops a common understanding of a process by those involved. No particular standardisation of symbology, so communication to a different audience may require considerable time and explanation. Cause and Effect , Fishbone, Ishikawa Diagram The cause-and-effect diagram is a method for analysing process dispersion.

The diagram's purpose is to relate causes and effects. Three basic types: Dispersion analysis, Process classification and cause enumeration. Effect = problem to be resolved, opportunity to be grasped, result to be achieved. Excellent for capturing team brainstorming output and for filling in from the 'wide picture'.

Helps organise and relate factors, providing a sequential view. Deals with time direction but not quantity. Can become very complex. Can be difficult to identify or demonstrate interrelationships. Histogram or Bar Graph A Histogram is a graphic summary of variation in a set of data. It enables us to see patterns that are difficult to see in a simple table of numbers. Can be analysed to draw conclusions about the data set.

A histogram is a graph in which the continuous variable is clustered into categories and the value of each cluster is plotted to give a series of bars as above.

The above example reveals the skewed distribution of a set of product measurements that remain nevertheless within specified limits. Without using some form of graphic this kind of problem can be difficult to analyse, recognise or identify. Check Sheets A Check Sheet is a data recording form that has been designed to readily interpret results from the form itself. It needs to be designed for the specific data it is to gather. Used for the collection of quantitative or qualitative repetitive data. Adaptable to different data gathering situations. Minimal interpretation of results required. Easy and quick to use.

No control for various forms of bias - exclusion, interaction, perception, operational, non-response, estimation. Check Lists A Checklist contains items that are important or relevant to a specific issue or situation. Checklists are used under operational conditions to ensure that all important steps or actions have been taken.

Their primary purpose is for guiding operations, not for collecting data. Generally used to check that all aspects of a situation have been taken into account before action or decision making. Simple, effective. References The Tools of Quality; Quality Progress, Nov 1990; J T Burr. The Tools of Quality; Quality Progress, Aug 1990; P D Shainin. Sarazen, JS., The Tools of Quality; Quality Progress, July 1990. Production Systems; J L Riggs, Wiley, 1987. Production/Operations management; Terry Hill, PHI, 1983. The Tools of Quality; Quality Progress, Sept 1990; The Juran Institute Find us on

Simple example of a Pareto chart using hypothetical data showing the relative frequency of reasons for arriving late at work A Pareto chart, named after Vilfredo Pareto, is a type of chart that contains both bars and a line graph, where individual values are represented in descending order by bars, and the cumulative total is represented by the line.

Pareto chart

"From Wikipedia, the free encyclopedianavigation search Pareto chart One of the Seven Basic Tools of Quality First described by Joseph M. Juran Purpose To assess the most frequently occurring defects by category†

The left vertical axis is the frequency of occurrence, but it can alternatively represent cost or another important unit of measure. The right vertical axis is the cumulative percentage of the total number of occurrences, total cost, or total of the particular unit of measure.

Because the values are in decreasing order, the cumulative function is a concave function. To take the example below, in order to lower the amount of late arrivals by 78%, it is sufficient to solve the first three issues.

The purpose of the Pareto chart is to highlight the most important among a (typically large) set of factors. In quality control, it often represents the most common sources of defects, the highest occurring type of defect, or the most frequent reasons for customer complaints, and so on.

st. Pareto Analysis Here are eight steps to identifying the principal causes you should focus on, using Pareto Analysis: Create a vertical bar chart with causes on the x-axis and count (number of occurrences) on the y-axis. Arrange the bar chart in descending order of cause importance that is, the cause with the highest count first.

Pareto Analysis Step by Step

Pareto Analysis is a statistical technique in decision-making used for the selection of a limited number of tasks that produce significant overall effect. It uses the Pareto Principle (also known as the 80/20 rule) the idea that by doing 20% of the work you can generate 80% of the benefit of doing the entire job.

Take quality improvement, for example, a vast majority of problems (80%) are produced by a few key causes (20%).

This technique is also called the vital few and the trivial many. In the late 1940s Romanian-born American engineer and management consultant, Joseph M. Juran suggested the principle and named it after Italian economist Vilfredo Pareto, who observed that 80% of income in Italy went to 20% of the population. Pareto later carried out surveys in some other countries and found to his surprise that a similar distribution applied.

We can apply the 80/20 rule to almost anything:80% of customer complaints arise from 20% of your products and services.80% of delays in the schedule result from 20% of the possible causes of the delays.20% of your products and services account for 80% of your profit.20% of your sales force produces 80% of your company revenues.20% of a systems defects cause 80% of its problems.

The Pareto Principle has many applications in quality control. It is the basis for the Pareto diagram, one of the key tools used in total quality control and Six Sigma.

In PMBOK, Pareto ordering is used to guide corrective action and to help the project team take steps to fix the problems that are causing the greatest number of defects fir

Pareto Analysis Step by Step

Pareto chart