Senior Lecturer, Strategy
Segal Room: SGL 3335
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Mark Moore is a Senior Lecturer at the Beedie School of Business at Simon Fraser University. He teaches Managerial Economics for the Executive MBA, Management of Technology MBA, and regular MBA programs, and for the Learning Strategies Group. He also teaches this course for the GDBA (online) program, and for the BBA program. He has supervised MBA projects for the EMBA program and for LSG. He teaches strategy for the BBA program.
Prior to coming to SFU, Mark taught business and economics at the University of British Columbia, Colgate University and Columbia University. He was also employed by the Bank of Canada in Ottawa, where he conducted research on monetary policy, international portfolio and direct investment flows, and options pricing methods; and as a consultant to Bankers Trust Company in New York, where he performed risk modelling and analysis of the loan portfolio.
Marks's current research is on the modelling and estimation of the appropriate social discount rate for use in evaluating public investments. He recently published a cost-benefit study of the consequences for consumers, government and shareholders of the privatization of Canadian National, a welfare analysis of the softwood lumber dispute, and a number of papers on social discount methods.
Public policy analysis, privatization and regulation, business strategy.
“The Theory and Evidence Pertaining to Local Government Mixed Enterprises” with A. Vining and A. Boardman. Forthcoming in a special issue of Annals of Public and Cooperative Economics on Local Mixed Companies (2013).
“More Appropriate Discounting: The Rate of Social Time Preference and the Value of the Social Discount Rate” with A. Boardman and A. Vining. Journal of Benefit-Cost Analysis, Vol. 4, No. 1, 1-16 (2013).
“Efficiency, Profitability and Welfare Gains from the Canadian National Railway Privatization” with A. Boardman, C. Laurin and A. Vining. Research in Transportation Business and Management, Vol. 6, 19-30 (2013).
"The Social Discount Rate for Canada Based on Future Growth in Consumption" with A. Boardman and A. Vining. Canadian Public Policy, Vol. 36, No. 3, 323-341 (2010).
"A Cost-Benefit Analysis of the Privatization of Canadian National Railway," with A. Boardman, C. Laurin, and A. Vining. Canadian Public Policy, Vol. 35, No. 1, 59-83 (2009).(Won the Vanderkamp prize for best article in Canadian Public Policy, 2009).
"Canadian-US Trade Policy: An Economic Analysis of the Softwood Lumber Case," (with R. Schwindt and A. Vining), American Behavioural Scientist, Vol. 47, No. 10, 1335-1357 (2004).
"Just Give Me A Number! Practical values for the Social Discount Rate," (with A. Boardman, A. Vining, D. Weimer and D. Greenberg), Journal of Policy Analysis and Management, Vol. 23, No. 4, 789-812 (2004).
"The Social Discount Rate in Canada," (with A. Boardman and D. Greenberg) in A. Vining and J.. Richards (eds.) Building the Future: Issues in Public Infrastructure in Canada, Toronto: C.D. Howe Institute, 2001, pp. 73-130.
"The Social Discount Rate in Canada" (with A. Boardman and A. Vining) presented at Discount Rates for the Evaluation of Public Private Partnerships, John Deutsch Institute for the Study of Economic Policy, Queen's University, October 3, 2008.
"Proposed Social Discount Rates for Canada Based on Future Growth" (with A. Boardman and A. Vining) presented at a conference on The Future of Strategic Evidence-Based Regulation, organised by The Policy Research Initiative, Ottawa, March 13, 2008.
"Making the Best of a Bad Situation: Canada's Policy Options in the Softwood Lumber Dispute," (with R. Schwindt and A. Vining) presented at the Western Regional Science Association 40th Annual Meeting, Palm Springs, CA, February 2001, and at the Pacific Northwest Regional Economic Conference, Victoria, BC, May 2001.
Published Article Abstracts:
"More Appropriate Discounting: The Rate of Social Time Preference and the Value of the Social Discount Rate"
Recently, a number of authors, including Burgess and Zerbe, have recommended the use of a real social discount rate (SDR) in the range of 6 to 8% in benefit-cost analysis (BCA) of public projects in the USA. They derive this rate based on the social opportunity cost of capital (SOC) method. In contrast, this article argues that the correct method is to discount future impacts based on the rate of social time preference (STP). Flows in or out of private investment should be multiplied by the shadow price of capital (SPC). Using this method and employing recent United States data, we obtain an estimate of the rate of STP of 3.5% and an SPC of 2.2. We also re-estimate the SDR using the SOC method and conclude that, even if analysts continue to use this method, they should use a considerably lower rate of about 5%.
"Efficiency, Profitability and Welfare Gains from the Canadian National Railway Privatization"
This article describes and analyzes the privatization of Canadian National Railway (CN), a large railroad privatization. First, it reviews the theory and evidence concerning railroad privatizations. Second, it presents a brief history of CN and the regulatory environment prior to and after CN's privatization. Third, it uses data from 1990 to 2011 to compare CN's post-privatization operating performance with its pre-privatization performance. Fourth, it uses cost–benefit analysis to estimate the social welfare gains from the privatization and the distribution of those gains. The overall results demonstrate that CN performed substantially better following privatization, both from an operational perspective and from a broader social welfare perspective. We find statistically significant increases over the long term (16 years following privatization) in sales, capital investment, assets, profit, profitability, productivity, dividends and corporate taxes paid. There was little change in the capital structure of CN and a significant decrease in employment. Using Canadian Pacific Railway as a basis for the counterfactual, we estimate that CN's privatization generated social welfare gains of approximately billion in 2011 Canadian dollars. The Canadian government received almost half of these gains, while CN's shareholders (most of whom were non-Canadian) captured the rest.
"The Social Discount Rate for Canada Based on Future Growth in Consumption"
Recent interim guidelines of the Treasury Board Secretariat (2007) recommend a social discount rate (SDR) of 8 percent. This paper argues that this value is based on an inappropriate methodology and is too high. Using a consumption rate of interest and drawing on a growth model, we suggest that if a project is intragenerational (less than 50 years) and there is no crowding out of private investment, then analysts should use a SDR of 3.5 percent. Impacts on investment should first be converted to consumption equivalents using a shadow price of capital of 1.26. If the project has intergenerational impacts (beyond 50 years), such as those affecting climate change, we recommend a schedule of time-declining SDRs.
"A Cost-Benefit Analysis of the Privatization of Canadian National Railway"
This paper uses cost-benefit analysis to estimate the welfare gains from the privatization of Canadian National Railway (CN), one of the largest rail privatizations in history. It also shows how these gains are distributed among consumers, producers and government, and between Canadians and non-Canadians. The paper uses the costs of Canadian Pacific Railway (CP) to create a more credible counterfactual than in previous privatization studies. Based on a conservative counterfactual, we estimate that CN's privatization generated welfare gains of at least billion (in 1992 dollars). However, the welfare gain is possibly as high as billion. The Canadian government captured almost half of these gains, while CN shareholders captured most of the rest.
"Canadian-US Trade Policy: An Economic Analysis of the Softwood Lumber Case"
Softwood lumber has been, and continues to be, the most contentious trade issue dividing the United States and Canada. This article examines the economic issues surrounding the dispute and considers possible resolutions to it. Specifically, the article reviews the recently expired Softwood Lumber Agreement, which restricted exports from four Canadian provinces to the United States beetween 1996 and 2001. The authors describe this voluntary export restraint agreement (VER), explain how it created windfall gains for Canadian holders of export quotas, discuss how these gains were partly dissipated, and use this analysis to consider a reformed VER. The authors also review other feasible policy alternatives. They compare the likely effects on various Canadian and U.S. interest groups of a reformed VER, an export tax, and an import tariff. They rank these policies from the point of view of each country's national welfare as well as from an aggregate North American perspective.
"Just Give Me A Number! Practical Values for the Social Discount Rate"
A major reason the quality of cost-benefit analysis (CBA) varies widely is inconsistent use of the social discount rate (SDR). This article offers guidance about the choice of the SDR. Namely, we recommend the following procedures: If the project is intra-generational (does not have effects beyond 50 years) and there is no crowding out of private investment, then discount all flows at 3.5 percent; if the project is intra-generational and there is some crowding out of investment, then weight investment flows by the shadow price of capital at 1.1 and then discount at 3.5 percent; if the project is intergenerational and there is no crowding out of investment, then use a time-declining scale of discount rates; if the project is intergenerational and investment is crowded out, then convert investment flows during the first 50 years to consumption equivalents using a shadow price of 1.1, and then discount all of these flows at 3.5 percent, and discount all flows after the 50th year using time-declining rates. We then compare current discounting practices of U.S. federal agencies with our estimates. Consistent use of the recommended rates would eliminate arbitrary choices of discount rates and would lead to better public sector decision-making.
The Rate of Social Time Preference, the Social Discount Rate and the Meaning of Sustainability
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