6XPPDU\RI5HVHDUFK$UHD%DVLVIRU DSSUDLVDORIHIIHFWVRIGLIIHUHQWOHYHOVRIVSHHG
3XEOLF
0$67(5
&RQWUDFW1R526&
3URMHFW
&RRUGLQDWRU 977&RPPXQLWLHV ,QIUDVWUXFWXUH977)LQODQG
3DUWQHUV )$&780&KDORXSND3UDVFKO 5LVVHU2+*)$&780$XVWULD 8QLYHUVLW\RI/HHGV,QVWLWXWHIRU7UDQVSRUW6WXGLHV,768.
.7,,QVWLWXWHIRU7UDQVSRUW6FLHQFHV/WG.7,+XQJDU\
8QLYHUVLW\RI/XQG'HSDUWPHQWRI3ODQQLQJDQG(QJLQHHULQJ/86ZHGHQ 712+XPDQ)DFWRUV5HVHDUFK,QVWLWXWH712WKH1HWKHUODQGV
7UDQVSRUW5HVHDUFK/DERUDWRU\75/8.
8QLYHUVLW\&ROOHJH/RQGRQ&HQWUHIRU7UDQVSRUW6WXGLHV8&/8.
$VVRFLDWH
SDUWQHUV ,175$6/6SDLQ
75$163253RUWXJDO
,QVWLWXWHIRU5RDG6DIHW\5HVHDUFKWKH1HWKHUODQGV
6ZHGLVK5RDGDQG7UDQVSRUW5HVHDUFK,QVWLWXWH97,6ZHGHQ
$XWKRU 5($OOVRS
8&/&HQWUHIRU7UDQVSRUW6WXGLHV8.
'DWH 6HSWHPEHU
352-(&7)81'('%<7+((8523($1
&200,66,2181'(57+(75$16325757' 352*5$00(2)7+(
WK)5$0(:25.352*5$00(
([HFXWLYH6XPPDU\
7KHVWDWHGDLPRIWKHSURMHFW0$67(5LVWRSURGXFHLQIRUPDWLRQWKDWFDQEHFLWHGLQWKH SUHSDUDWLRQRIQDWLRQDO DQG (8 GHFLVLRQV FRQFHUQLQJ VSHHG PDQDJHPHQW DQG VWDQGDUGV IRUVSHHGFRQWUROHTXLSPHQW)RUWKLVSXUSRVHWKHSURMHFWVHHNVDQVZHUVWRWKUHHNH\
TXHVWLRQV
:KDWDUHDFFHSWDEOHUDQJHVRIVSHHGV"
:KDWDUHWKHNH\IDFWRUVLQIOXHQFLQJGULYHUV©FKRLFHRIVSHHG"
:KDWDUHWKHEHVWVSHHGPDQDJHPHQWWRROVDQGVWUDWHJLHV"
(DFKRI:RUN$UHDVDGGUHVVHVRQHRIWKHVHTXHVWLRQVDQGWKHVXPPDU\UHSRUWVIURP WKHVHWKUHHZRUNDUHDVSURYLGHWKHPDLQLQSXWV LQWR :RUN $UHD ZKLFK LV FRQFHUQHG ZLWKPDNLQJUHFRPPHQGDWLRQVIRUVSHHGPDQDJHPHQWVWUDWHJLHVDQGSROLFLHV
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
6SHHGPDQDJHPHQWLVLQWXUQFRQFHUQHGQRWRQO\ZLWKWKHVHWWLQJDQGHQIRUFLQJRIVSHHG OLPLWVWRGLVFRXUDJHRUSUHYHQWH[FHVVVSHHGVEXWDOVRZLWKDFKLHYLQJGULYHUEHKDYLRXU ZKLFKUHVXOWVLQFKRLFHVRIVSHHGWKDWDUHDSSURSULDWHLQWKHSUHYDLOLQJFLUFXPVWDQFHVWR GLVFRXUDJHRUSUHYHQWLQDSSURSULDWHVSHHGV
7KHDSSURSULDWHQHVVRIDQ\SDUWLFXODUOHYHORIVSHHGGHSHQGVVWURQJO\XSRQWKHW\SHRI URDG DQG LWV VXUURXQGLQJV :LWKLQ HDFK EURDG FDWHJRU\ RI URDG DSSURSULDWH OHYHOV RI VSHHGZLOOGHSHQGXSRQUHJLRQDOIDFWRUVOHYHORIWUDIILFPL[WXUHRIIXQFWLRQVHVSHFLDOO\
XVHVE\YXOQHUDEOHURDGXVHUVOD\RXWGLPHQVLRQVIUHTXHQF\DQGW\SHRIMXQFWLRQVDQG SUR[LPLW\WRKRPHVVFKRROVVKRSVRWKHUFRPPXQLW\EXLOGLQJVDQGORFDORSHQVSDFH 5HODWLRQVKLSVEHWZHHQOHYHOVRIVSHHGDQGRFFXUUHQFHRIDFFLGHQWVRQGLIIHUHQWNLQGVRI (XURSHDQURDGVKDYHEHHQLQYHVWLJDWHGLQWKUHHVWDJHVDUHYLHZZDVPDGHRISUHYLRXV
VWXGLHVRIWKHUHODWLRQVKLSEHWZHHQVSHHGDQGDFFLGHQWVVWDWLVWLFDOPRGHOOLQJZDVDSSOLHG WRDVHWRIGDWDIRUVLQJOHFDUULDJHZD\UXUDOURDGVLQ&HQWUDODQG6RXWKHUQ(QJODQGDQG WKH UHVXOWLQJ PRGHO ZDV DSSOLHG WR GDWD IURP 7KH 1HWKHUODQGV 3RUWXJDO DQG 6ZHGHQ DQGUHILQHGDFFRUGLQJO\
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
DYDLODEOH LQIRUPDWLRQ WR VXSSRUW WKH DSSUDLVDO RI VSHHG PDQDJHPHQW PHDVXUHV DQG SROLFLHVKDVEHHQDVVHVVHG:KHUHDVWKHHIIHFWRIVSHHGXSRQWKHQXPEHUDQGVHYHULW\RI DFFLGHQWV LV HVVHQWLDOO\ PRQRWRQLF WKLV LV E\ QR PHDQV DOZD\V WKH FDVH ZLWK WKH RWKHU HIIHFWV/HYHOVRIVSHHGFDQDOVRDIIHFWWKHWUDIILFFDSDFLW\RIVHFWLRQVRIURDGEXWWKLV HIIHFWLVQRWFRQVLGHUHGKHUH
,WZDVIRXQGWKDWWKHUHH[LVWDUDQJHRIPRGHOVDQGGDWDIURPZKLFKDV\VWHPDWLFEDVLV IRU HVWLPDWLRQ RI HIIHFWV RI VSHHG PDQDJHPHQW PHDVXUHV DQG SROLFLHV XSRQ H[KDXVW HPLVVLRQV DQG QRLVH FRXOG EH GHYHORSHG EXW HIIRUW ZLOO EH UHTXLUHG WR H[SORLW WKHVH
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
,QUHDFKLQJGHFLVLRQVDERXWVSHHGPDQDJHPHQWLWLVKHOSIXOIRUWKHGHFLVLRQPDNHUVWREH DVIXOO\LQIRUPHGDVLVSUDFWLFDEOHDERXWWKHHIIHFWVWKDWDQ\VSHHGPDQDJHPHQWSROLFLHV DQGPHDVXUHVWKH\DUHFRQVLGHULQJPD\KDYHERWKLQDJJUHJDWHDQGLQWKHLUGLVWULEXWLRQ RYHUWKHDIIHFWHGSHRSOH7KLVLVKHOSIXOQRWRQO\WRWKHLURZQGHFLVLRQPDNLQJEXWDOVR LQWKHLUWDVNRIFRQVXOWLQJWKHDIIHFWHGSHRSOHDQGDVVHVVLQJWKHDFFHSWDELOLW\WRWKHPRI WKHHQYLVDJHGSROLFLHVDQGPHDVXUHV
:RUN ZLWKLQ 0$67(5 KDV SURYLGHG D IUDPHZRUN IRU WKH SUHVHQWDWLRQ WR SRWHQWLDOO\
DIIHFWHGSHRSOHDQGWRGHFLVLRQPDNHUVRIWKHUDQJHDQGGLVWULEXWLRQRIOLNHO\HIIHFWVRI VSHHG PDQDJHPHQW PHDVXUHV DFKLHYLQJ DQ\ SDUWLFXODU WDUJHW OHYHO RI VSHHG RQ DQ\
SDUWLFXODUURDGVHFWLRQRURIVSHHGPDQDJHPHQWSROLFLHVDFKLHYLQJDQ\SDUWLFXODUPL[RI WDUJHW OHYHOV RI VSHHG RQ URDGV RI GLIIHUHQW NLQGV WKURXJKRXW D URDG QHWZRUN 7KH IUDPHZRUNLVWUDQVSDUHQWDQGLVIOH[LEOHLQDOORZLQJXVHUVWRGHFLGHWKHZHLJKWLQJVWREH DWWDFKHGWRGLIIHUHQWHIIHFWVDQGZKLFKDUHWREHH[SUHVVHGLQPRQHWDU\WHUPV,WLVHDV\
WRDSSO\RQFHWKHXVHUKDVGHFLGHGZKLFKHIIHFWVRIVSHHGDUHWREHLQFOXGHGDQGRQWKH EDVLV RI ZKLFK IXQFWLRQV RU PRGHOV DQG ZKDW FRUUHVSRQGLQJ GDWD 7KH IUDPHZRUN LV IOH[LEOH LQ WHUPV RI WKH XVHU©V FKRLFH DPRQJ H[LVWLQJ IXQFWLRQV DQG PRGHOV DQG ZLWK UHVSHFWWRQHZIXQFWLRQVDQGPRGHOVWKDWPD\EHFRPHDYDLODEOHLQWKHIXWXUH9DULRXV DVSHFWVRIWKHXVHRIWKLVIUDPHZRUNLQFOXGLQJWKHH[WHQWRIDYDLODELOLW\RIWKHLQSXWVWKDW LWVXVHUVZLOOQHHGWRSURYLGHDUHGLVFXVVHG
&217(176
(;(&87,9(6800$5<
$%675$&7 ,1752'8&7,21 %DFNJURXQGDQGSXUSRVH 7KHHIIHFWVRIVSHHGOHYHOV 7\SHVRIURDG .(<),1',1*6 (IIHFWVRIVSHHGOHYHOVRQDFFLGHQWV 3UHYLRXVVWXGLHVRIVSHHGDFFLGHQWUHODWLRQVKLSV 6WDWLVWLFDOPRGHOOLQJIRUVLQJOHFDUULDJHZD\ UXUDOURDGVLQ(QJODQG 5HODWHGPRGHOOLQJIRUGDWDIURP7KH1HWKHUODQGV3RUWXJDODQG
6ZHGHQ &RQFOXVLRQV 2WKHUHIIHFWVRIVSHHGOHYHOV ([KDXVWHPLVVLRQV 1RLVHDQGYLEUDWLRQ &RVWVWRXVHUVRIYHKLFOHV &RQFOXVLRQV $FFHSWDELOLW\RIVSHHGOHYHOV 352&('85(72$66,67'(&,6,210$.(56&21&(51,1*63(('
0$1$*(0(17 &RQWH[WIRUGHFLVLRQPDNLQJ )UDPHZRUNIRUSUHVHQWDWLRQRIHIIHFWVRIVSHHG 6FRSH /LPLWDWLRQV $SSOLFDWLRQRIWKHIUDPHZRUN $SSOLFDWLRQLQORFDOUHJLRQDOQDWLRQDODQGLQWHUQDWLRQDOFRQWH[WV $SSOLFDWLRQWRGLIIHUHQWW\SHVRIURDG 8VHRIWKHRXWSXWVLQGHFLVLRQPDNLQJ &21&/86,21 $&.12:/('*(0(176 5()(5(1&(6
$33(1',&(6
$SSHQGL[ 0RGHOV IRU PHDQ VSHHG DQG QXPEHU RI LQMXU\ DFFLGHQWV SHU \HDU RQ VWUHWFKHVRIVLQJOHFDUULDJHZD\UXUDOURDGLQ(QJODQG
$SSHQGL[ 0RGHOIRUPHDQVSHHGRQVWUHWFKHVRIVLQJOHFDUULDJHZD\UXUDOURDGLQ (QJODQG7KH1HWKHUODQGV3RUWXJDODQG6ZHGHQ
$SSHQGL[ 0RGHOIRUWKHQXPEHURILQMXU\DFFLGHQWVSHU\HDURQVWUHWFKHVRIVLQJOH FDUULDJHZD\UXUDOURDGLQ(QJODQG7KH1HWKHUODQGVDQG6ZHGHQ
$EVWUDFW
7KLVVXPPDU\UHSRUWRQ:RUN$UHDRIWKHSURMHFW0$67(50$QDJLQJWKH6SHHGVRI 7UDIILF RQ (XURSHDQ 5RDGV DGGUHVVHV WKH TXHVWLRQ ¦:KDW DUH DFFHSWDEOH UDQJHV RI VSHHGV"§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
,1752'8&7,21
%$&.*5281'$1'385326(
7KHVWDWHGDLPRIWKHSURMHFW0$67(5LVWRSURGXFHLQIRUPDWLRQWKDWFDQEHFLWHGLQWKH SUHSDUDWLRQRIQDWLRQDO DQG (8 GHFLVLRQV FRQFHUQLQJ VSHHG PDQDJHPHQW DQG VWDQGDUGV IRUVSHHGFRQWUROHTXLSPHQW)RUWKLVSXUSRVHWKHSURMHFWVHHNVDQVZHUVWRWKUHHNH\
TXHVWLRQV
:KDWDUHDFFHSWDEOHUDQJHVRIVSHHGV "
:KDWDUHWKHNH\IDFWRUVLQIOXHQFLQJGULYHUV©FKRLFHRIVSHHG"
:KDWDUHWKHEHVWVSHHGPDQDJHPHQWWRROVDQGVWUDWHJLHV"
(DFKRI:RUN$UHDVDGGUHVVHVRQHRIWKHVHTXHVWLRQVDQGWKHVXPPDU\UHSRUWVIURP WKHVHWKUHHZRUNDUHDVSURYLGHWKHPDLQLQSXWV LQWR :RUN $UHD ZKLFK LV FRQFHUQHG ZLWKPDNLQJUHFRPPHQGDWLRQVIRUVSHHGPDQDJHPHQWVWUDWHJLHVDQGSROLFLHV
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
7+(())(&762)63(('/(9(/6
7KH UDSLG GRRUWRGRRU MRXUQH\ WLPHV PDGH SRVVLEOH E\ PRWRU YHKLFOHV DQG WKH URDG V\VWHPDUHRQHRIWKH JUHDW EHQHILWV FRQIHUUHG E\ PRGHUQ WUDQVSRUW %XW WKH OHYHOV RI VSHHG WKDW PDNH SRVVLEOH WKHVH MRXUQH\ WLPHV DOVR KDYH HIIHFWV LQ WHUPV RI RSHUDWLQJ FRVWV QRLVH H[KDXVW HPLVVLRQV DQG WKH RFFXUUHQFH RI WUDIILF DFFLGHQWV DQG FRQVHTXHQW GHDWKLQMXU\DQGPDWHULDOGDPDJH:KHUHPRWRUWUDIILFVKDUHVWKHURDGZLWKYXOQHUDEOH URDGXVHUVRUWUDYHOVFORVHWRSHRSOH©VKRPHVLVVXHVRIDFFHSWDELOLW\RIOHYHOVRIVSHHGWR YXOQHUDEOHURDGXVHUVDQGWRUHVLGHQWVDULVH1RUDUHFXUUHQWOHYHOVRIVSHHGQHFHVVDULO\
DFFHSWDEOHWRDOORIWKHGULYHUVZKRSDUWLFLSDWHLQWKHP
7KHSURMHFW0$67(5DURVHSULPDULO\IURPFRQFHUQVDERXWWKHFRQWULEXWLRQRIVSHHGWR WKHQXPEHUDQGVHYHULW\RIDFFLGHQWVFDXVLQJGHDWKDQGLQMXU\DVH[SUHVVHGIRUH[DPSOH E\WKH(XURSHDQ7UDQVSRUW6DIHW\&RXQFLO DQG UHLWHUDWHG PRUH UHFHQWO\ E\ WKH
&RPPLVVLRQRIWKH(XURSHDQ&RPPXQLWLHVDQGWKH&RPPLWWHHRQ7UDQVSRUWDQG 7RXULVP RI WKH (XURSHDQ 3DUOLDPHQW %XW DFFLGHQW SUHYHQWLRQ DQG FDVXDOW\
UHGXFWLRQDVDQREMHFWLYHRIVSHHGPDQDJHPHQWKDVWREHSXUVXHGZLWKGXHFRQVLGHUDWLRQ
IRUWKHYDOXHWRLQGLYLGXDOVDQGVRFLHW\RIUDSLGMRXUQH\WLPHVWKHFRQVHTXHQFHVRIOHYHOV RIVSHHGIRURSHUDWLQJFRVWVHPLVVLRQVDQGQRLVHDQGWKHDFFHSWDELOLW\RIOHYHOVRIVSHHG WRURDGXVHUVRIDOONLQGVDQGWRRWKHUVDIIHFWHGE\WKHP$OOWKHVHHIIHFWVRIOHYHOVRI VSHHGPXVWWKHUHIRUHEHDVVHVVHGFRPSUHKHQVLYHO\LQWKHFRQWH[WRIVSHHGPDQDJHPHQW /HYHOVRIVSHHGFDQDOVRDIIHFWWKHWUDIILFFDSDFLW\RIVHFWLRQVRIURDGEXWWKLVHIIHFWLV QRWFRQVLGHUHGKHUH
6SHHGPDQDJHPHQWLVLQWXUQFRQFHUQHGQRWRQO\ZLWKWKHVHWWLQJDQGHQIRUFLQJRIVSHHG OLPLWVWRGLVFRXUDJHRUSUHYHQWH[FHVVVSHHGVEXWDOVRZLWKDFKLHYLQJGULYHUEHKDYLRXU ZKLFKUHVXOWVLQFKRLFHVRIVSHHGWKDWDUHDSSURSULDWHLQWKHSUHYDLOLQJFLUFXPVWDQFHVWR GLVFRXUDJHRUSUHYHQWLQDSSURSULDWHVSHHGV
7<3(62)52$'
7KHDSSURSULDWHQHVVRIDQ\SDUWLFXODUOHYHORIVSHHGGHSHQGVVWURQJO\XSRQWKHW\SHRI URDGDQGLWVVXUURXQGLQJV)RUSXUSRVHVRIVSHHGPDQDJHPHQWLWLVXVHIXOWRGLVWLQJXLVK
• PRWRUZD\V
• PDLQUXUDOURDGVGXDOFDUULDJHZD\DQGVLQJOHFDUULDJHZD\
• ORFDOUXUDOURDGV
• PDLQXUEDQURDGV
• GLVWULEXWRUURDGVLQXUEDQDUHDV
• DFFHVVURDGVLQXUEDQDUHDV¤PDLQO\UHVLGHQWLDO
:LWKLQ HDFK RI WKHVH EURDG FDWHJRULHV DSSURSULDWH OHYHOV RI VSHHG ZLOO GHSHQG XSRQ UHJLRQDOIDFWRUVOHYHORIWUDIILFPL[WXUHRIIXQFWLRQVHVSHFLDOO\XVHVE\YXOQHUDEOHURDG XVHUV OD\RXW GLPHQVLRQV IUHTXHQF\ DQG W\SH RI MXQFWLRQV DQG SUR[LPLW\ WR KRPHV VFKRROVVKRSVRWKHUFRPPXQLW\EXLOGLQJVDQGORFDORSHQVSDFH
.(<),1',1*6
())(&762)63(('/(9(/621$&&,'(176
5HODWLRQVKLSVEHWZHHQOHYHOVRIVSHHGDQGRFFXUUHQFHRIDFFLGHQWVRQGLIIHUHQWNLQGVRI (XURSHDQ URDGV KDYH EHHQ LQYHVWLJDWHG LQ WKUHH VWDJHV UHSRUWHG LQ :RUNLQJ 3DSHUV DQG%DUX\DDE
D D UHYLHZ ZDV PDGH RI SUHYLRXV VWXGLHV RI WKH UHODWLRQVKLS EHWZHHQ VSHHG DQG DFFLGHQWV
E VWDWLVWLFDOPRGHOOLQJZDVDSSOLHGWRDVHWRIGDWDIRUVLQJOHFDUULDJHZD\UXUDOURDGVLQ
&HQWUDODQG6RXWKHUQ(QJODQGDQG
F WKHUHVXOWLQJPRGHOZDVDSSOLHGWRGDWDIURP7KH1HWKHUODQGV3RUWXJDODQG6ZHGHQ DQGUHILQHGDFFRUGLQJO\
7KHUHVXOWVRIWKHVHWKUHHVWDJHVRIWKHZRUNKDYHEHHQEURXJKWWRJHWKHULQ'HOLYHUDEOH '%DUX\DF
3UHYLRXVVWXGLHVRIVSHHGDFFLGHQWUHODWLRQVKLSV
(DUO\ VWXGLHV RI WKH UHODWLRQVKLS EHWZHHQ VSHHG DQG DFFLGHQW LQYROYHPHQW VKRZHG WKDW YHKLFOHV WUDYHOOLQJ PRUH VORZO\ WKDQ WKH DYHUDJH VSHHG IRU WKH URDG DV ZHOO DV WKRVH WUDYHOOLQJIDVWHUKDGDQDERYHDYHUDJHULVNRIDFFLGHQWLQYROYHPHQWEXWWKDWWKHVHYHULW\
RI DFFLGHQWV LQFUHDVHG PRUH WKDQ SURSRUWLRQDOO\ WR VSHHG 7KHVH HDUO\ ILQGLQJV DUH FRQVLVWHQWZLWKVXEVHTXHQWILQGLQJVWKDWRQURDGVRIDJLYHQW\SHDFFLGHQWUDWHLQMXU\
DFFLGHQWUDWHDQGIDWDODFFLGHQWUDWHLQFUHDVHURXJKO\DVWKHQGUGDQGWKSRZHUVRI WKHPHGLDQWUDIILFVSHHG$QGHUVVRQDQG1LOVVRQDQGWKDWDFFLGHQWUDWHV DQG WKH YDULDQFH RI VSHHG DUH SRVLWLYHO\ FRUUHODWHG *DUEHU DQG *DUGLUDX $SSDUHQWO\
FRQWUDGLFWRU\LQGLFDWLRQVLQWKHODWWHUVWXG\WKDWDFFLGHQWUDWHZDVQHJDWLYHO\FRUUHODWHG ZLWKPHDQVSHHGFRXOGEHDFFRXQWHGIRUE\IDLOXUHWRDOORZIRUGLIIHUHQFHVLQJHRPHWULF FKDUDFWHULVWLFVEHWZHHQWKHURDGVWKDWKDGEHHQVWXGLHG
%\WKHHDUO\VLWKDGEHFRPHFOHDUWKDWLQYHVWLJDWLRQVRIVSHHGDFFLGHQWUHODWLRQVKLSV E\PHDQVRIFURVVVHFWLRQDODQDO\VLVRIGDWDIRUVDPSOHVRIVWUHWFKHVRIURDGQHHGWRWDNH LQWRDFFRXQWWUDIILFIORZJHRPHWULFDOFKDUDFWHULVWLFVDQGWKHYDULDEOLOLW\RIVSHHGVDVZHOO DVPHDQVSHHGDQGWKDWPXOWLSOLFDWLYHPRGHOVZHUHDSSURSULDWHIRUWKLVSXUSRVH
$ FRPSOHPHQWDU\ DSSURDFK WR WKDW RI FURVVVHFWLRQDO DQDO\VLV LV WKH EHIRUHDQGDIWHU DQDO\VLVRIDFFLGHQWRFFXUUHQFHLQVLWXDWLRQVLQZKLFKFKDQJHVLQWKHOHYHOVRIVSHHGVRQ SDUWLFXODU URDGV KDYH EHHQ EURXJKW DERXW IRU H[DPSOH E\ FKDQJLQJ WKH VSHHG OLPLW
$JDLQE\WKHHDUO\VWKHOLWHUDWXUHFRQWDLQHGUHSRUWVRIDQXPEHURIVXFKVWXGLHV FRYHULQJ EHWZHHQ WKHP D UDQJH RI W\SHV RI URDG DQG ERWK XSZDUG DQG GRZQZDUG FKDQJHVLQVSHHG$ODUJHFROOHFWLRQRIWKHVHUHVXOWVZHUHDQDO\VHGWRJHWKHUE\)LQFKHW
DO OHDGLQJ WR WKH UXOH RI WKXPE WKDW D SHU FHQW UHGXFWLRQ LQ LQMXU\ DFFLGHQWV UHVXOWVIURPDNPKUHGXFWLRQLQPHDQVSHHG
:KLOVWWKHHYLGHQFHRIFDXVDOLW\LQUHODWLRQVKLSVGHULYHGIURPEHIRUHDQGDIWHUDQDO\VLVLV VWURQJHU WKDQ LQ WKRVH GHULYHG IURP FURVVVHFWLRQDO DQDO\VLV WKH RSSRUWXQLWLHV IRU WKH IRUPHU DUH IHZHU WKDQ IRU WKH ODWWHU WKH WLPHVFDOH IRU JDWKHULQJ WKH GDWD IRU WKHP LV ORQJHU DQG WKH VFRSH IRU REWDLQLQJ UHSUHVHQWDWLYH VDPSOHV RI VLWHV ZLWK JLYHQ FKDUDFWHULVWLFV LV VPDOOHU 7KH PRVW H[WHQVLYH LQYHVWLJDWLRQV RI VSHHGDFFLGHQW UHODWLRQVKLSVLQUHFHQW\HDUVKDYHWKHUHIRUHEHHQEDVHGRQFURVVVHFWLRQDODQDO\VLV
'DWD IRU VWUHWFKHV RI XUEDQ URDG LQ %ULWDLQ ZHUH DQDO\VHG E\ %DUX\D DQG )LQFK ZKRIRXQGWKDWWKHURDGVFRXOGEHFOHDUO\FDWHJRULVHGLQWHUPVRISDUDPHWHUVRI WKHGLVWULEXWLRQVRIVSHHGVRIYHKLFOHVXVLQJWKHPLQWRIRXUJURXSV
•&LW\FHQWUH
•,QQHUXUEDQ
•6XEXUEDQ
•6HPLUXUDO
7KH\VKRZHGIXUWKHUE\JHQHUDOLVHGOLQHDUPRGHOOLQJ 0F&XOODJKDQG1HOGHUWKDW WKHQXPEHUVRIDFFLGHQWVSHU\HDUFRXOGEHHVWLPDWHGWREHSURSRUWLRQDOWR
PHDQVSHHGWRWKHSRZHUDQG
H[S[FRHIILFLHQWRIYDULDWLRQRIVSHHG
ZLWK D FRQVWDQW RI SURSRUWLRQDOLW\ HVWLPDWHG LQ WHUPV RI LQGLFDWRUV RI YHKLFXODU DQG SHGHVWULDQ DFWLYLW\ QXPEHUV RI MXQFWLRQV DPRXQW RI NHUEVLGH XVHG IRU SDUNLQJ SURSRUWLRQ RI EXVHV LQ WKH WUDIILF ZKHWKHU LQ /RQGRQ DQG FODVV RI URDG 7KLV PRGHO DFFRXQWHG IRU RI WKH QRQ3RLVVRQ YDULDWLRQ LQ WKH DFFLGHQW QXPEHUV DQG DV ZDV HQYLVDJHGLQWKHSURSRVDOIRU0$67(5PRGHOOLQJRIWKLVW\SHZDVWDNHQDVWKHVWDUWLQJ SRLQWIRULQYHVWLJDWLRQRIVSHHGDFFLGHQWUHODWLRQVKLSVIRUVLQJOHFDUULDJHZD\UXUDOURDGV
6WDWLVWLFDOPRGHOOLQJIRUVLQJOHFDUULDJHZD\UXUDOURDGVLQ(QJODQG 6SHHG IORZ DQG \HDUV© DFFLGHQW GDWD ZHUH DQDO\VHG IRU VWUHWFKHV RI UXUDO VLQJOH FDUULDJHZD\URDGLQYDULRXVFRXQWLHVLQ(QJODQG/LPLWHGJHRPHWULFGDWDZDVH[WUDFWHG IURPPDSV$GGLWLRQDOJHRPHWULFGDWDJDWKHUHGRQVLWHZDVDYDLODEOHIRUDVXEVHWRIWKH URDGV2QRIWKHURDGVWKHVSHHGOLPLWZDVPLOHVKNPKDQGRQWKHRWKHULW ZDV PLOHVK NPK 7KH GLVWULEXWLRQ RI VSHHGV RI YHKLFOHV RQ HDFK URDG ZDV FKDUDFWHULVHGE\WKUHHSDUDPHWHUV
•WKHPHDQVSHHG
•WKHSURSRUWLRQH[FHHGLQJWKHVSHHGOLPLWDQG
•WKHSURSRUWLRQWUDYHOOLQJDWOHVVWKDQKDOIWKHVSHHGOLPLW
7KHVHFRQGDQGWKLUGSDUDPHWHUVFDQEHVHHQDVLQGLFDWRUVRIWKHOHYHOVRIVSHHGLQJDQG FRQJHVWLRQUHVSHFWLYHO\RUVLPSO\DVLQGLFDWRUVRIWKHVL]HVRIWKHXSSHUDQGORZHUWDLOV RIWKHGLVWULEXWLRQ
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
•PHDQVSHHGLQNPKWRWKHSRZHU
•SHUFHQWDJHH[FHHGLQJWKHVSHHGOLPLWWRWKHSRZHUDQG
•SHUFHQWDJHEHORZKDOIWKHVSHHGOLPLWWRWKHSRZHU
ZLWKDFRQVWDQWRISURSRUWLRQDOLW\HVWLPDWHGLQWHUPVRIDPRXQWRIWUDIILFOHQJWKRIWKH VWUHWFKRIWKHURDGDQGQXPEHURIMXQFWLRQV7KHILWZDVPRGHVWDFFRXQWLQJIRURQO\
SHUFHQWRIWKHQRQ3RLVVRQYDULDWLRQLQWKHDFFLGHQWQXPEHUVSHU\HDU 'HWDLOV RI WKH ILWWHGPRGHOVIRUPHDQVSHHGDQGQXPEHURIDFFLGHQWVSHU\HDUDUHJLYHQLQ$SSHQGL[
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
7KLV FDQ EH LOOXVWUDWHG E\ FRQVLGHULQJ D NP VWUHWFK RI URDG ZLWKRXW MXQFWLRQV ZLWK D VSHHGOLPLWRINPKDQGDIORZRIYHKLFOHVGD\7DEOHVKRZVIRUSHUFHQWDJHV H[FHHGLQJWKHVSHHGOLPLWUDQJLQJIURPWRZKDWSHUFHQWDJHVEHORZKDOIWKH VSHHG OLPLWDUHFRQVLVWHQWDFFRUGLQJWRWKHPRGHOIRUPHDQVSHHGZLWKPHDQVSHHGVRINPK DQGNPKWRJHWKHUZLWKWKHFRUUHVSRQGLQJHVWLPDWHGQXPEHUVRIDFFLGHQWVSHU\HDU ,QHYHU\FDVHIHZHUDFFLGHQWVSHU\HDUDUHHVWLPDWHGWRRFFXUDWWKHORZHUVSHHGEXWWKH
GLIIHUHQFH LV PXFK VPDOOHU WKDQ ZRXOG EH H[SHFWHG IURP WKH UXOH RI WKXPE EDVHG RQ EHIRUHDQGDIWHUVWXGLHV7KLVGLVFUHSDQF\LVDGGUHVVHGLQ6HFWLRQEXWWKHVLJQDQG VL]HRIWKHSRZHURIPHDQVSHHGLQWKHPRGHOUHPDLQDVRXUFHRIFRQFHUQ7KHODFNRI YDULDWLRQ LQ HVWLPDWHG DFFLGHQW QXPEHUV DV WKH SHUFHQWDJH H[FHHGLQJ WKH VSHHG OLPLW FKDQJHVLVDFFRXQWHGIRUE\WKHFRXQWHUYDLOLQJFKDQJHLQWKHSHUFHQWDJHXQGHUKDOIWKH VSHHGOLPLWWKDWLVUHTXULHGWRNHHSWKHPHDQVSHHGVDWWKHLUFKRVHQOHYHOV
7DEOH(VWLPDWHGQXPEHUVRILQMXU\DFFLGHQWV\HDURQDNPOHQJWKRIUXUDOVLQJOH FDUULDJHZD\URDGLQ(QJODQGZLWKVSHHGOLPLWRINPKDQGIORZRI
YHKLFOHVGD\ZKHQWKHPHDQVSHHGLVRUNPKDQGWKHSHUFHQWDJHH[FHHGLQJWKH VSHHGOLPLWUDQJHVIURPWR
3HUFHQWDJH H[FHHGLQJ WKHVSHHGOLPLW
3HUFHQWDJHXQGHUKDOIWKHVSHHG
OLPLWZLWKPHDQVSHHG (VWLPDWHGQXPEHURILQMXU\
DFFLGHQWVSHU\HDUZLWKPHDQ VSHHG
NPK NPK NPK NPK
$VHFRQGTXHVWLRQDULVHVIURPWKHIDFWWKDWWKHPRGHOVDUHEHLQJFRQVLGHUHGKHUHLQWKH FRQWH[WRIVSHHG PDQDJHPHQW 7KLV LV ZKHWKHU LW LV DSSURSULDWH IRU WKH GLVWULEXWLRQ RI VSHHGVWREHGHVFULEHGE\SDUDPHWHUVWKDWDUHGHILQHGLQUHODWLRQWRWKHVSHHGOLPLWZKLFK LVLWVHOIRQHRIWKHPDQDJHPHQWWRROVWKDWQHHGWREHDVVHVVHG,WZRXOGEHSUHIHUDEOHWR XVHSDUDPHWHUVLQKHUHQWLQWKHVSHHGGLVWULEXWLRQOLNHWKHFRHIILFLHQWRIYDULDWLRQDVXVHG
LQWKHPRGHOIRUQXPEHUVRIDFFLGHQWVSHU\HDURQXUEDQURDGVWKDWZDVTXRWHGDWWKHHQG RI6HFWLRQ
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
$ IRXUWK TXHVWLRQ LV ZKHWKHU LI IXOOHU GDWD DERXW URDG JHRPHWU\ KDG EHHQ DYDLODEOH UHOHYDQW JHRPHWULF SDUDPHWHUV ZRXOG KDYH EHHQ VLJQLILFDQW LQ WKH ILWWHG PRGHOV 7KLV ZRXOGEHUHOHYDQWWRWKHXVHRIWKHPRGHOVWRHVWLPDWHWKHOLNHO\HIIHFWVRIFKDQJHVLQ URDGJHRPHWU\EHLQJFRQVLGHUHGIRUSXUSRVHVRIVSHHGPDQDJHPHQW
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
5HODWHGPRGHOOLQJIRUGDWDIURP7KH1HWKHUODQGV3RUWXJDODQG 6ZHGHQ
'DWD DYDLODEOH IRU WULDO DSSOLFDWLRQ RI WKH PRGHOV GHVFULEHG LQ 6HFWLRQ WR VLQJOH FDUULDJHZD\ UXUDO URDGV LQ RWKHU 0HPEHU 6WDWHV FRPSULVHG LQIRUPDWLRQ DERXW VSHHG IORZURDGJHRPHWU\DQGLQMXU\DFFLGHQWVRQVWUHWFKHVRIURDGLQ7KH1HWKHUODQGV LQ3RUWXJDODQGLQ6ZHGHQQRWTXLWHDOORIZKLFKFRXOGEHXVHGIRUHYHU\DVSHFWRI WKHDQDO\VLV 7KHVH GDWD ZHUH IRU URDGV ZLWK VSHHG OLPLWV RI DQG NPKDQGIRUMRLQWDQDO\VLVWKHURDGVLQ(QJODQGZHUHUHJDUGHGDVKDYLQJVSHHGOLPLWVRI DQGNPK
0HDQVSHHGZDV IRXQG WR EH HVWLPDWHG LQ WHUPV RI VSHHG OLPLW SHUFHQWDJHV DERYH WKH OLPLW DQG EHORZ KDOI WKH OLPLW DQG WUDIILF IORZ E\ D PRGHO ZLWK SDUDPHWHU YDOXHV FRQVLVWHQW ZLWK WKRVH HVWLPDWHG IURP WKH (QJOLVK GDWD DORQH ZLWK WKH DGGLWLRQ RI D
PXOWLSOLHU FRPSULVLQJ URDG OHQJWK UDLVHG WR D VPDOO SRZHU 'HWDLOV RI WKLV PRGHO DUH JLYHQLQ$SSHQGL[
:KHQWKHPRGHOIRUQXPEHURILQMXU\DFFLGHQWVSHU\HDUIURP6HFWLRQZDVDSSOLHG GLUHFWO\WRGDWDIURPWKHRWKHUWKUHHFRXQWULHVLWRYHUHVWLPDWHGDFFLGHQWIUHTXHQFLHVIRU 7KH1HWKHUODQGVDQG6ZHGHQE\IDFWRUVRIDQGUHVSHFWLYHO\DQGXQGHUHVWLPDWHG WKRVHIRU3RUWXJDOE\DIDFWRURI
7KH PRGHO ZDV ILUVW UHILQHG E\ ILWWLQJ WR GDWD IURP (QJODQG 7KH 1HWKHUODQGV DQG 6ZHGHQXVLQJWKHVDPHYDULDEOHVDVIRUWKHSUHYLRXVILWWLQJWRWKH(QJOLVKGDWDH[FHSW WKDWURDGZLGWKZDVOLVWHGDVDQDGGLWLRQDOYDULDEOHZKLFKPHDQWWKDWGDWDIRURQO\
VWUHWFKHVRIURDGLQ(QJODQGZHUHDYDLODEOH1XPEHURIDFFLGHQWVSHU\HDUZDVHVWLPDWHG WREHSURSRUWLRQDOWR
•PHDQVSHHGLQNPKWRWKHSRZHU
•SHUFHQWDJHH[FHHGLQJWKHVSHHGOLPLWWRWKHSRZHUDQG
•H[S[VSHHGOLPLW
ZLWKDFRQVWDQWRISURSRUWLRQDOLW\HVWLPDWHGLQWHUPVRIWKHDPRXQWRIWUDIILFOHQJWKRI WKHVWUHWFKRIURDGQXPEHURIMXQFWLRQVDQGURDGZLGWK,PSRUWDQWGLIIHUHQFHVLQWKH VSHHGUHODWHG WHUPV LQ WKLV PRGHO IURP WKH HDUOLHU ILWWLQJ WR WKH (QJOLVK GDWD DUH WKDW SHUFHQWDJH EHORZ KDOI WKH VSHHG OLPLW GRHV QRW DSSHDU LQ WKH PRGHO VSHHG OLPLW GRHV DSSHDURQWKHEDVLVRIGDWDIRUDUDQJHRIYDOXHVDQGWKHSRZHURIPHDQVSHHGLVPRUH WKDQ KDOYHG WKRXJK LW UHPDLQV QHJDWLYH 7KLV PRGHO DFFRXQWV IRU SHU FHQW RI WKH QRQ3RLVVRQYDULDWLRQLQWKHDFFLGHQWQXPEHUVSHU\HDUDQGZDVIRXQGWRILWWKHGDWDIRU DOOFRXQWULHVZHOOEXWVWLOOWR XQGHUHVWLPDWH WKH QXPEHU RI DFFLGHQWV SHU \HDU RQ WKH 3RUWXJXHVHURDGVE\DIDFWRURI
'HWDLOVRIWKLVPRGHODUHJLYHQLQ$SSHQGL[)URPWKLVPRGHODQGWKHFRXQWU\PRGHO IRUPHDQVSHHGLWFDQEHHVWLPDWHGWKDWIRUFKDQJHVLQPHDQVSHHGUHVXOWLQJVLPSO\IURP DQLQFUHDVHLQGULYLQJDERYHWKHOLPLWWKHHODVWLFLW\RIQXPEHURILQMXU\DFFLGHQWVZLWK UHVSHFWWRPHDQVSHHGLVDERXW
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
7DEOH(VWLPDWHGQXPEHUVRILQMXU\DFFLGHQWV\HDURQDNPOHQJWKRIUXUDO VLQJOHFDUULDJHZD\URDGPZLGHLQ(QJODQG7KH1HWKHUODQGVRU6ZHGHQZLWKD IORZRIYHKLFOHVGD\ZKHQWKHPHDQVSHHGLVNPZLWKDVSHHGOLPLWRI NPKRUNPKZLWKDVSHHGOLPLWRINPKDQGWKHSHUFHQWDJHH[FHHGLQJWKH VSHHGOLPLWUDQJHVIURPWR
3HUFHQWDJHXQGHUKDOIWKHVSHHG
OLPLWZLWKPHDQVSHHG (VWLPDWHGQXPEHURILQMXU\
DFFLGHQWVSHU\HDUZLWKPHDQ VSHHG
3HUFHQWDJH H[FHHGLQJ WKHVSHHGOLPLW
NPK NPK NPK NPK
,WFDQEHVHHQLQWKLVFDVHWKDWWKHPRGHOVHVWLPDWHDUHGXFWLRQRIDERXWSHUFHQWLQWKH QXPEHURILQMXU\DFFLGHQWVFRUUHVSRQGLQJWRWKLVNPKUHGXFWLRQLQPHDQVSHHG7KLV LVOHVVWKDQWKHSHUFHQWUHGXFWLRQWKDWZRXOGEHH[SHFWHGDFFRUGLQJWRWKHUXOHRI WKXPEEDVHGRQEHIRUHDQGDIWHUVWXGLHVEXWLWLVRIDVLPLODURUGHURIPDJQLWXGHDQG JLYHVUHDVRQWRH[SHFWWKDWIXUWKHUPRGHOGHYHORSPHQWFRXOGUHVROYHWKHLQFRQVLVWHQF\
)RU WKH 3RUWXJXHVH URDGV LW ZDV IRXQG WKDW ZLWK WKH H[FHSWLRQ RI WZR URDGV ZLWK XQXVXDOO\KLJKDFFLGHQWIUHTXHQFLHVWKHQXPEHURIDFFLGHQWVSHU\HDUFRXOGEHURXJKO\
HVWLPDWHGE\DSSO\LQJWKHPRGHOILWWHGWRGDWDIURPWKHRWKHUWKUHHFRXQWULHVDQGUDLVLQJ WKH UHVXOWLQJ HVWLPDWH WR WKH SRZHU 5HDVRQV IRU WKLV GLIIHUHQFH UHPDLQ WR EH LQYHVWLJDWHG
$ E\SURGXFW RI WKH DQDO\VLV RI GDWD IURP WKH IRXU FRXQWULHV ZDV D ILQGLQJ WKDW WKH VDPSOHG VWUHWFKHV RI URDG FRXOG EH FODVVLILHG LQ WHUPV RI WUDIILF IORZ URDG ZLGWK DQG SDUDPHWHUVRIWKHVSHHGGLVWULEXWLRQLQWRJURXSV
•FRQJHVWHGURDGVZLWKKLJKIORZDQGORZVSHHGV
•QDUURZHUURDGVZLWKPRGHUDWHIORZDQGDZLGHUDQJHRIVSHHGV
•XQFRQJHVWHGURDGVZLWKORZIORZDQGPDQ\H[FHVVVSHHGV
•ZLGHURDGVZLWKPRGHUDWHIORZDQGKLJKVSHHGV
7DNHQ WRJHWKHU ZLWK DSSURSULDWH FRQVLGHUDWLRQ RI WKH VXUURXQGLQJV OD\RXW DQG WUDIILF DQG RWKHU IXQFWLRQV RI WKH URDG DQG VXEMHFW WR D GHILQLWLRQ RI FRQJHVWHG WKDW WDNHV DFFRXQW RI YDULDWLRQ RI WUDIILF IORZ RYHU WKH GD\ WKLV FODVVLILFDWLRQ PLJKW SHUKDSV FRQWULEXWH WR D WUDQVQDWLRQDO FDWHJRULVDWLRQ RI UXUDO VLQJOHFDUULDJHZD\ URDGV LQGHSHQGHQWRIQDWLRQDODGPLQLVWUDWLYHFODVVLILFDWLRQV
&RQFOXVLRQV
:RUNZLWKLQ0$67(5RQVSHHGDFFLGHQWUHODWLRQVKLSVWKRXJKRQO\SUHOLPLQDU\LQVFDOH DQG FRQILQHG WR RQH LPSRUWDQW FDWHJRU\ RI URDGV VLQJOHFDUULDJHZD\ UXUDO URDGV KDV GHPRQVWUDWHG WKDW FURVVVHFWLRQDO ORJOLQHDU VWDWLVWLFDO PRGHOOLQJ RIIHUV WKH SURVSHFW RI FURVVQDWLRQDOPRGHOVWKDWFRXOGHVWLPDWHWKHHIIHFWVRIFKRLFHRIVSHHGVXSRQDFFLGHQW IUHTXHQFLHVRQSDUWLFXODUFDWHJRULHVRIURDGLQDUDQJHRI0HPEHU6WDWHV
'HYHORSPHQWRI WKLV WRRO WR FRQWULEXWH WR WKH DSSUDLVDO RI HIIHFWV RI GLIIHUHQW OHYHOV RI VSHHG RQ GLIIHUHQW W\SHV RI URDG UHTXLUHV D IXOOVFDOH SURJUDPPH RI GHYHORSPHQW RI FURVVQDWLRQDOPRGHOVIRUHDFKUHOHYDQWFDWHJRU\RIURDGQRWDEO\PRWRUZD\VPDLQUXUDO URDGVDQGPDLQXUEDQURDGV
6XFKDSURJUDPPHVKRXOGUHFRJQLVHWKDW
D IXOOVFDOH PRGHO GHYHORSPHQW UHTXLUHV H[WHQVLYH FROOHFWLRQ RI KLJKTXDOLW\ VSHHG IORZDQGJHRPHWULFGDWDDFFRUGLQJWRDVWULFWH[SHULPHQWDOGHVLJQIURPDSSURSULDWHO\
VHOHFWHGVWUHWFKHVRIURDGLQDUDQJHRI0HPEHU6WDWHV
E WKH GHVLJQ RI WKH IXOOVFDOH ZRUN PD\ XVHIXOO\ EH LQIRUPHG E\ VPDOOHU IRFXVVHG VWXGLHVWRH[SORUHSDUWLFXODUDVSHFWVRIWKHPRGHOOLQJ
F VSHHGVKRXOGEHUHSUHVHQWHGLQWKHPRGHOVQRWVLPSO\E\WKHPHDQRUPHGLDQVSHHG EXW E\ D UDQJH RI SDUDPHWHUV RI WKH GLVWULEXWLRQ RI VSHHGV DQG WKHVH SDUDPHWHUV VKRXOGEHGHWHUPLQHGIURPWKHREVHUYHGVSHHGVWKHPVHOYHVZLWKRXWUHIHUHQFHWRWKH VSHHGOLPLW
G WKHVSHHGOLPLWLWVHOILVDVHSDUDWHFDQGLGDWHYDULDEOHIRULQFOXVLRQLQWKHPRGHOV H PRGHOV ZKLFK DUH FURVVQDWLRQDO LQ UHVSHFW RI PDQ\ SDUDPHWHUV ZLOO SUREDEO\ DOVR
QHHGWRLQFOXGHVRPHQDWLRQDOO\RUHYHQUHJLRQDOO\VSHFLILFSDUDPHWHUVDQG
I GHYHORSPHQWRIWKHPRGHOVVKRXOGLQFOXGHH[WHQVLYHFURVVFKHFNLQJIRUFRQVLVWHQF\
ZLWK WKH DYDLODEOH UHVXOWV RI EHIRUHDQGDIWHU DQDO\VLV RI WKH HIIHFWV RI FKDQJHV LQ VSHHGRQDFFLGHQWRFFXUUHQFH
$SSOLFDWLRQ RI WKH UHVXOWLQJ PRGHOV ZLOO UHTXLUH PXWXDOO\ FRQVLVWHQW DGMXVWPHQW RI DOO VSHHGUHODWHG YDULDEOHV WR UHIOHFW WKH DFWXDO QDWXUH RI FKDQJHV LQ VSHHG OHYHOV WKDW DUH EHLQJ DSSUDLVHG RYHUVLPSOLVWLF LQWHUSUHWDWLRQ RI LQGLYLGXDO SDUDPHWHUV ZLOO QHHG WR EH JXDUGHG DJDLQVW 8VH RI WKH PRGHOV LQ SUDFWLFH VKRXOG WKHQ EH DFFRPSDQLHG E\ D SURJUDPPHRIEHIRUHDQGDIWHUVWXGLHVWRPRQLWRUWKHLUFRQWLQXLQJYDOLGLW\
27+(5())(&762)63(('/(9(/6
7KH RWKHU SULQFLSDO HIIHFWV RI VSHHG OHYHOV DUH XSRQ H[KDXVW HPLVVLRQV QRLVH DQG YLEUDWLRQDQGYHKLFOHRSHUDWLQJ FRVWV LQFOXGLQJ IXHO XVH DQG WKH WUDYHOWLPH RI YHKLFOH XVHUV,QIRUPDWLRQDERXWWKHVHHIIHFWVKDVEHHQDVVHPEOHGDQGWKHDGHTXDF\RIFXUUHQWO\
DYDLODEOH LQIRUPDWLRQ WR VXSSRUW WKH DSSUDLVDO RI VSHHG PDQDJHPHQW PHDVXUHV DQG SROLFLHV KDV EHHQ DVVHVVHG LQ :RUNLQJ 3DSHUV DQG 5REHUWVRQHW DO 5REHUWVRQDQG:DUG:KHUHDVWKHHIIHFWRIVSHHGXSRQWKHQXPEHUDQGVHYHULW\
RIDFFLGHQWVLVHVVHQWLDOO\PRQRWRQLFWKLVLVE\QRPHDQVDOZD\VWKHFDVHZLWKWKHRWKHU HIIHFWV
([KDXVWHPLVVLRQV
7KHUHYLHZE\5REHUWVRQHWDORILQIRUPDWLRQDERXWHIIHFWVRIVSHHGRQH[KDXVW HPLVVLRQVFRQVLGHUVPDLQO\HPLVVLRQVRI
• FDUERQPRQR[LGH&2
• K\GURFDUERQV+&
• R[LGHVRIQLWURJHQ12[DQG
• SDUWLFXODWHV
&DUERQGLR[LGHLVSURGXFHGLQSURSRUWLRQWRIXHOFRQVXPSWLRQZKLFKLVFRQVLGHUHGERWK KHUHDQGLQ6HFWLRQIROORZLQJ3DUWLFXODWHVDUHPHQWLRQHGEULHIO\
7KHUHYLHZEHJLQVE\VXPPDULVLQJWKHSURFHVVHVE\ZKLFKHPLVVLRQVIURPPRWRUYHKLFOHV DUHSURGXFHGDQGSRLQWVRXWWKHLPSRUWDQFHRIDFFHOHUDWLRQDQGEUDNLQJDVZHOODVVSHHG LWVHOILQGHWHUPLQLQJ WKH OHYHO DQG FRPSRVLWLRQ RI HPLVVLRQV 8SZDUG FKDQJHV LQ VSHHG JLYHULVHWRH[FHVVHPLVVLRQVFRPSDUHGZLWKWUDYHODWFRQVWDQWVSHHG7KHLPSRUWDQFHRI FROGVWDUWVDQGWKHLQHIIHFWLYHQHVVRIFDWDO\WLFFRQYHUWHUVLQWKHSHULRGEHIRUHWKH\UHDFK WKHLUZRUNLQJWHPSHUDWXUHDUHQRWHG
7KH UHOHYDQFH WR DSSUDLVDO RI VSHHG PDQDJHPHQW PHDVXUHV RI SUHYLRXV VWXGLHV RI WKH HQYLURQPHQWDOHIIHFWVRIWUDIILFPDQDJHPHQWVFKHPHVLVLGHQWLILHGDQGDQLQWHUQDWLRQDOO\
ZLGHUDQJLQJ UHYLHZ RI DVVHVVPHQWV RI WKHVH $EERWW HW DO LV LGHQWLILHG
&RXQWHUSDUWVWXGLHVRIHIIHFWVRIVFKHPHVRQLQWHUXUEDQURDGVDUHH[HPSOLILHGE\DVWXG\
E\0HW]HWDORIDVFKHPHRQD*HUPDQ$XWREDKQ
6RPH PLFURVFRSLF DQG PHVRVFRSLF WUDIILF VLPXODWLRQ PRGHOV FDQ EH XVHG WR SURYLGH HVWLPDWHV RI HIIHFWV RI WUDIILF PDQDJHPHQW VFKHPHV RQ HPLVVLRQV DQG GHWDLOV RI WKRVH ZKLFKFODLPWKLVFDSDELOLW\DUHVXPPDULVHGE\5REHUWVRQHWDO
$ PLFURVFRSLF PRGHO GHYHORSHG VSHFLILFDOO\ WR SURYLGH HVWLPDWHV RI YHKLFOH HPLVVLRQV XQGHU YDULRXV UHODWLYHO\ IUHHIORZLQJ WUDIILF FRQGLWLRQV LV WKH PRGHO 9(72 +DPPDUVWU|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
7KHPRGHOOLQJFDQEHH[WHQGHGWRWKHPRUHUHDOLVWLFFDVHRIJLYHQIORZVRIPL[WXUHVRI YHKLFOHVZLWKGLIIHUHQWGHVLUHGVSHHGVWUDYHOOLQJRQDJLYHQVWUHWFKRIURDG7KLVUHTXLUHV PLFURVFRSLF VLPXODWLRQ RI WKH WUDIILF FRQFHUQHG WUDYHOOLQJ DORQJ WKH URDG EHLQJ FRQVLGHUHG LQ RUGHU WR UHIOHFW WKH DFFHOHUDWLRQ DQG GHFHOHUDWLRQ DVVRFLDWHG ZLWK RYHUWDNLQJDQGZLWKZDLWLQJIRURSSRUWXQLWLHVWRGRVR
7KH H[DPSOH HVWLPDWHV IRU IORZV RI WUDIILF DW SDUWLFXODU VSHHGV LQGLFDWH WKDW RQ D OHYHO URDGIXHOXVHE\WKHH[DPSOHPL[RIWUDIILFLVPLQLPLVHGDWDERXWNPKWRJHWKHUZLWK
&2DQG12[HPLVVLRQVZKHUHDVSDUWLFXODWHHPLVVLRQVDUH PLQLPLVHG DW DERXW NPK DQG WKRVH RI +& DW DERXW NPK 7KH UDQJHV RI YDULDWLRQ RI IXHO XVH DQG WKHVH HPLVVLRQVRYHUWKHVSHHGUDQJHNPKRQDOHYHOURDGDUHEHWZHHQDERXWDQG
*UDGLHQWKDVDVWURQJHIIHFWRQIXHOXVHDQGVWURQJO\GLIIHUHQWLDWHGHIIHFWVRQWKHYDULRXV HPLVVLRQV
$FFHOHUDWLQJYHKLFOHVLQWKLVPL[RIWUDIILFE\NPKRQWKHOHYHOXVHVRIWKHRUGHURI SHU FHQW RI WKH IXHO XVHG LQ WUDYHOOLQJ NP DW VWHDG\ VSHHG DQG WKH FRUUHVSRQGLQJ SHUFHQWDJHVIRUHPLVVLRQVUDQJHIURPDERXWIRU+&WRDERXWIRUSDUWLFXODWHV$OO WKHVHSHUFHQWDJHVDUHGHSHQGHQWXSRQWKHLQLWLDOVSHHGIURPZKLFKWKHDFFHOHUDWLRQWDNHV SODFH'HFHOHUDWLQJWKLVPL[RIYHKLFOHVE\NPKRQWKHOHYHOUHVXOWVLQPXFKVPDOOHU UHGXFWLRQVLQIXHOXVHDQGHPLVVLRQVH[FHSWWKDWDWORZVSHHGVGHFHOHUDWLRQFDQUHVXOWLQ VPDOODGGLWLRQDOHPLVVLRQVRI&2
7ZR GDWDEDVHV FRQFHUQLQJ HPLVVLRQV ZHUH LGHQWLILHG &25,1$,5 (JJOHVWRQ HW DO ZDVGHYHORSHGWRSURYLGHDQ(8ZLGHLQYHQWRU\RISROOXWDQWVRXUFHVE\0HPEHU 6WDWH LQ DQG KDV VLQFH EHHQ XSGDWHG ,W LQFOXGHV HVWLPDWHV RI HPLVVLRQV DW D VHW
VSHHG IRU FHUWDLQ W\SHV RI YHKLFOH DQG URDG WRJHWKHU ZLWK FXUYHV HVWLPDWLQJ VSHHG GHSHQGHQFH
02'(0 WDNHV WKH IRUP RI D FRPSXWHU SURJUDP %DUORZ LQFRUSRUDWLQJ GDWD UHVXOWLQJIURPDVWXG\-RVWHWDOLQZKLFKYHKLFOHVIURPDUDQJHRI(XURSHDQ SDVVHQJHUFDUVZHUHXVHGWRPHDVXUHLQWKHODERUDWRU\HPLVVLRQVIURPDVHWRIUHDOLVWLF GULYLQJF\FOHVEDVHGRQRQVWUHHWPHDVXUHPHQWVPDGHZLWKLQVWUXPHQWHGFDUVLQFLWLHV LQ%ULWDLQ)UDQFHDQG*HUPDQ\
7KHUHWKXVH[LVWDUDQJHRIPRGHOVDQGGDWDIURPZKLFKDV\VWHPDWLFEDVLVIRUHVWLPDWLRQ RI HIIHFWV XSRQ HPLVVLRQV RI VSHHG PDQDJHPHQW PHDVXUHV DQG SROLFLHV FRXOG EH GHYHORSHGEXWHIIRUWZLOOEHQHHGHGWRH[SORLWWKHVHVRXUFHVIXOO\
1RLVHDQGYLEUDWLRQ
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
LQWHQVLW\RIWKHVRXQG
7UDIILF QRLVH DULVHV IURP WZR PDLQ VRXUFHV WKH SRZHU XQLWV RI YHKLFOHV DQG W\UHURDG LQWHUDFWLRQ1RLVHIURPWKHODWWHUGRPLQDWHVDWKLJKHUVSHHGVDERYHWKHUDQJH NPK IRU QHZ FDUV DQG DERYH NPK IRU QHZ ORUULHV EHFDXVH W\UHURDG QRLVH LQFUHDVHVVWURQJO\ZLWKVSHHGW\SLFDOO\E\G%$IRUDGRXEOLQJRIVSHHG)RUROGHU YHKLFOHV WKH VSHHGV DERYH ZKLFK W\UHURDG QRLVH GRPLQDWHV DUH DERXW NPK KLJKHU EHFDXVHSRZHUXQLWQRLVHKDVEHHQSURJUHVVLYHO\UHGXFHGE\GHYHORSPHQWVLQWHFKQRORJ\
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
HTXLYDOHQW VRXQG OHYHO IRU D JLYHQ IORZ RI VLPLODU YHKLFOHV LV WKHUHIRUH DOVR W\SLFDOO\
SURSRUWLRQDO WR YHKLFOH VSHHG WR WKH SRZHU :KHQ YDULDELOLW\ EHWZHHQ YHKLFOHV ZKLFK LV JUHDWHU DW ORZHU WKDQ DW KLJKHU VSHHGV LV WDNHQ LQWR DFFRXQW KRZHYHU WKH
GHSHQGHQFHVRIPD[LPXPQRLVHOHYHODQGHQHUJ\HTXLYDOHQWQRLVHOHYHOXSRQVSHHGDUH IRXQGWREHTXLWHVLPLODU7HPD1RUG
0DQ\ (XURSHDQ FRXQWULHV KDYH HVWDEOLVKHG URDG WUDIILF QRLVH SUHGLFWLRQ PRGHOV DQG D UHFHQWFRPSDULVRQRIVHYHQRIWKHP9DQ/HHXZHQHWDOKDVVKRZQWKDWWKH\DUH FRQVLVWHQWWRZLWKLQRUG%$LQUHSUHVHQWLQJWKHGHSHQGHQFHRIYHKLFOHQRLVHXSRQ VSHHG7KHPRUHUHFHQW\GHYHORSHGRUXSGDWHGPRGHOVDUHOLNHO\WREHPRUHDFFXUDWHLQ WKLVUHVSHFWEHFDXVHRIWKHUHFHQWWHQGHQF\IRUWKHOHVVVSHHGGHSHQGHQWSRZHUXQLWQRLVH WRGHFUHDVHUHODWLYHWRWKHPRUHVSHHGGHSHQGHQWW\UHURDGQRLVH
2QHRIWKHPRVWUHFHQWPRGHOVLVWKH1RUGLFPRGHOSURGXFHGE\7HPD1RUGDQG PDGHRSHUDWLRQDOLQVRIWZDUHSURGXFHGE\7ULYHFWRU7KLVLVXVHGE\5REHUWVRQ HWDOWRFDOFXODWHH[DPSOHVRIWKHHVWLPDWHGVSHHGGHSHQGHQFHRI$ZHLJKWHG/HT
RYHU WKH UDQJH NPK DW D VSHFLILHG SRVLWLRQ UHODWLYH WR URDGV ZLWK GLIIHUHQW JUDGLHQWVFDUU\LQJDJLYHQPL[RIWUDIILFDWGLIIHUHQWOHYHOVRIIORZ,QDOOFDVHVWKHYDOXH RI/HTLVVLPLODUDWDQGNPKDQGWKHQULVHVURXJKO\OLQHDUO\DQGE\DERXWG%$
EHWZHHQDERXWDQGNPK$JUDGLHQWRISHUFHQWLVHVWLPDWHGWRDGGDERXW G%$EXWWKHPRGHOLVXQDEOH\HWWRHVWLPDWHGLIIHUHQFHVEHWZHHQWKHJUDGLHQWHIIHFWVDW GLIIHUHQWVSHHGV
(IIHFWVRIDFFHOHUDWLRQDQGGHFHOHUDWLRQRQQRLVHDUHW\SLFDOO\PRGHVWDWVSHHGVRYHU NPK EXW KLJKHU DW VSHHGV ORZHU WKDQ WKLV 7KLV KDV LPSOLFDWLRQV IRU WKH XVH RI LQWHUPLWWHQWVSHHGUHGXFLQJGHYLFHVVXFKDVURDGKXPSVRUFKLFDQHV6SHFLDOO\WH[WXUHG VXUIDFHVDQGVXUIDFHZHWQHVVFDQDIIHFWWKHOHYHORIQRLVHEXWYDULDWLRQVRIWKHVHHIIHFWV ZLWKVSHHGDUHPRGHVW
6SHHGFDQDIIHFWWKHGLVWDQFHRYHUZKLFKQRLVHWUDYHOVWRWKHH[WHQWWKDWWKHIUHTXHQF\
VSHFWUXP RI WKH QRLVH LV DOWHUHG E\ FKDQJHV LQ VSHHG EHFDXVH WKH ORZHU IUHTXHQF\
FRPSRQHQWVWUDYHOIXUWKHU
9LEUDWLRQLQEXLOGLQJVFDQEHFDXVHGE\URDGWUDIILFHLWKHUWKURXJKORZIUHTXHQF\QRLVH FDXVLQJ UHVRQDQFH LQ FRPSRQHQWV RI EXLOGLQJV RU WKURXJK ERXQFLQJ RI WKH ZKHHOV RI KHDY\ YHKLFOHV FDXVLQJ JURXQG YLEUDWLRQ )LQGLQJV RQ WKH GHSHQGHQFH RI YLEUDWLRQ RQ WUDIILFVSHHGZHUHQRWORFDWHG
&RVWVWRXVHUVRIYHKLFOHV
6SHHGPDQDJHPHQWLQIOXHQFHVWKHVSHHGVDWZKLFKYHKLFOHVDUHGULYHQRQYDULRXVNLQGVRI URDGVLQWKH FRXUVH RI WKHLU MRXUQH\V 7KLV LQ WXUQ DIIHFWV WKH XVHUV RI WKH YHKLFOHV E\
FKDQJLQJ
•WKHWLPHVSHQWRQWKHMRXUQH\
•WKHDPRXQWRIIXHOXVHG
•WKHDPRXQWRIRLOXVHG
•WKHDPRXQWRIZHDURQWKHW\UHV
•WKHFRVWRIPDLQWDLQLQJWKHYHKLFOHVDQG
•WKHUDWHRIGHSUHFLDWLRQRIWKHYHKLFOHV
7KHVH DUH FKDQJHV LQ WKH FRVWV LQFXUUHG E\ XVHUV RI WKH YHKLFOHV 6RPH PD\ EH TXLWH DFFXUDWHO\ SHUFHLYHG E\ WKH XVHUV LQ WHUPV RI WKH WLPH DQG PRQH\ WKH\ KDYH DYDLODEOH RWKHUVPD\EHDSSUHFLDEO\RUHYHQVXEVWDQWLDOO\PLVSHUFHLYHG 0LVSHUFHSWLRQ GRHV QRW DIIHFW WKH LQFLGHQFH RI WKH FKDQJHV LQ FRVW EXW GRHV DIIHFW WKH XVHUV© UHVSRQVH WR WKH FKDQJHV6RPHRQHZKRQRWLFHVWKDWDMRXUQH\WDNHVORQJHURU FRVWV PRUH PD\ VHHN WR PRGLI\WKHLUWUDYHOWRPLWLJDWHWKHLQFUHDVHVLQFRVWZKHUHDVQRVXFKUHVSRQVHLVOLNHO\LI WKHFKDQJHVLQFRVWDUHQRWQRWLFHGRUQRWDVVRFLDWHGZLWKWKHMRXUQH\IURPZKLFKWKH\
DULVH
1RU GR FKDQJHV LQ FRVWV WR XVHUV LPSO\ HTXDO FKDQJHV LQ FRVW DV UHFNRQHG E\
JRYHUQPHQWVIURPWKHSRLQWRIYLHZRIVRFLHW\7KHHOHPHQWRIWD[DWLRQLQSULFHVSDLG IRUWKHXVHRIYHKLFOHVLVDFRVWWRWKHXVHUEXWQRWWRVRFLHW\ZKLFKJDLQVLISHRSOHVSHQG PRUHRQKLJKO\WD[HGLWHPVVXFKDVIXHOIRUPRWRUYHKLFOHVDQGOHVVRQPRGHVWO\WD[HG LWHPV$QGJRYHUQPHQWVGRQRWLQJHQHUDODWWDFKWKHVDPHYDOXHWRSHRSOH©VWLPHVSHQW RUVDYHGDVGRWKHSHRSOHWKHPVHOYHV
7KHDPRXQWRIIXHOXVHGLVLPSRUWDQWQRWRQO\DVDFRVWWRWKHXVHUVEXWDOVRDVDUHOLDEOH LQGLFDWRURIWKHTXDQWLW\RI&2SURGXFHGE\YHKLFOHXVH
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
0RVW DFWXDO MRXUQH\V FRQVLVW KRZHYHU RI WUDYHO DORQJ D QXPEHU RI GLIIHUHQW URDG VHFWLRQV RIWHQ RI ZLGHO\ GLIIHULQJ FKDUDFWHULVWLFV DQG OLDEOH WR EH DIIHFWHG LQ TXLWH GLIIHUHQW ZD\V E\ VSHHG PDQDJHPHQW 7R HVWLPDWH WKH HIIHFW RI YDULRXV VSHHG PDQDJHPHQWPHDVXUHVRQVXFKDMRXUQH\ZRXOGLQSULQFLSOHUHTXLUHWKHDSSURSULDWHFRVW PRGHOWREHDSSOLHGWRHDFKURDGVHFWLRQDQGWKHHIIHFWVDFFXPXODWHGRYHUWKHMRXUQH\
([DPSOHFDOFXODWLRQVDUHUHSRUWHGE\5REHUWVRQDQG:DUG
$JDLQWRHVWLPDWHWKHDJJUHJDWHHIIHFWRIVSHHGPDQDJHPHQWXSRQRQHSDUWLFXODUURDG VHFWLRQZRXOGUHTXLUHWKHFRVWPRGHOIRUWKDWVHFWLRQWREHXVHGWRHVWLPDWHWKHFKDQJHV LQFRVWVWRXVHUVRIDOOYHKLFOHVWUDYHOOLQJDORQJWKDWURDGVHFWLRQDVSDUWRIWKHLUMRXUQH\
7KHDYDLODELOLW\RIGDWDWRVXSSRUWVXFKFDOFXODWLRQVLVH[DPLQHGE\5REHUWVRQDQG:DUG $ QXPEHU RI 0HPEHU 6WDWHV FDUU\ RXW V\VWHPDWLF VXUYH\V RI SHUVRQDO WUDYHO ZKLFKSURYLGHUHOLDEOHLQIRUPDWLRQDERXWWKHGLVWULEXWLRQRIOHQJWKVRIMRXUQH\VE\FDU VKRZLQJ IRU H[DPSOH WKDW LQ *HUPDQ\ WKH ORQJHVW SHU FHQW RI MRXUQH\V DFFRXQW IRU QHDUO\ SHU FHQW RI YHKLFOHGLVWDQFH WUDYHOOHG ZKLOVW WKH VKRUWHVW SHU FHQW RI MRXUQH\V DFFRXQW IRU RQO\ SHU FHQW 7KHUH LV DOVR DJJUHJDWH GDWD IURP V\VWHPDWLF
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
VPDOOHURQHVLWLVVWURQJO\GHEDWHGZKHWKHUWKHVDPHLV WUXH RI FKDQJHV LQ WUDYHO WLPH 3UDFWLFHLQWKHYDOXDWLRQRIVXFKFKDQJHVGLIIHUVLQWKLVUHVSHFW DPRQJ 0HPEHU 6WDWHV 6RPH DJJUHJDWH DOO FKDQJHV LQ WLPH KRZHYHU VPDOO DQG YDOXH WKH WRWDO ZKLOVW RWKHUV GLVUHJDUGFKDQJHVVPDOOHUWKDQDFHUWDLQWKUHVKROG:KHUHWKHODWWHUDSSURDFKLVDGRSWHG LQUHODWLRQWRVSHHGPDQDJHPHQWLWZLOOEHQHFHVVDU\WRHVWLPDWHWKHGLVWULEXWLRQRIWKH LQFLGHQFHRIWUDYHOWLPHFKDQJHVLQRUGHUWR NQRZ IRU KRZ PDQ\ MRXUQH\V WKH FKDQJHV H[FHHGWKHWKUHVKROGDQGE\KRZPXFK
&RQFOXVLRQV
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
$&&(37$%,/,7<2)63(('/(9(/6
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
'HOLYHUDEOH'5LVVHUDQG/HKQHUGHVFULEHVDVXUYH\LQ ZKLFK D VDPSOH RI URDG XVHUV LQ HDFK RI VL[ (XURSHDQ FRXQWULHV $XVWULD *HUPDQ\ +XQJDU\ 3RUWXJDO 6SDLQ DQG 6ZHGHQ ZHUH LQWHUYLHZHG DERXW DFFHSWDELOLW\ RI OHYHOV RI VSHHG DQG RI PHDVXUHVWROLPLWVSHHG7KHLUUHVSRQVHVLQUHVSHFWRIOHYHOVRIVSHHGDUHGLVFXVVHGKHUH WKRVHLQUHVSHFWRIPHDVXUHVWROLPLWVSHHGDUHGLVFXVVHG:RUNLQJ3DSHU9DQGHU +RUVW,QHDFKFRXQWU\URDGXVHUVZHUHVHOHFWHGLQHDFKRIIRXUVLWXDWLRQV
•EHWZHHQMXQFWLRQVRQDRUODQHXUEDQURDG
•LQDQDUURZRQHZD\XUEDQVWUHHWZLWKSDUNHGFDUV
•DWDQXQFRQWUROOHGMXQFWLRQZLWKFDUGULYHUVLQWHUDFWLQJZLWKSHGHVWULDQVDQGF\FOLVWV ZKLOHJRLQJDKHDGRUWXUQLQJDQG
•DWWKHHQWUDQFHWRDYLOODJH
$ERXWKDOIRIWKRVHDWHDFKVLWHZHUHLQWHUYLHZHGDVEHLQJFDUGULYHUVDQGWKHRWKHUKDOI DV EHLQJ SHGHVWULDQV LQFOXGLQJ D IHZ F\FOLVWV 7KH UHVSRQVHV ZHUH VXIILFLHQWO\
FRQVLVWHQWDFURVVWKHFRXQWULHVIRUWKH GDWD IRU DOO URDG XVHUV WR EH LQWHUSUHWHG ODUJHO\DVDZKROH
$ERXWKDOIRIWKRVHLQWHUYLHZHGDVFDUGULYHUVDQGDERXWWKUHHILIWKVRIWKRVHLQWHUYLHZHG DVSHGHVWULDQVWKRXJKWWKDWFXUUHQWVSHHGVZHUHWRRKLJKWKLVRSLQLRQUHODWHGVHSDUDWHO\
WRPRWRUZD\VUXUDOURDGVURDGVLQEXLOWXSDUHDVDQGURDGVLQUHVLGHQWLDODUHDV:KHQ DVNHG DERXW VLWXDWLRQV LQ ZKLFK VSHHGV VKRXOG EH UHGXFHG ERWK JURXSV PHQWLRQHG WKH SUHVHQFH RI SHGHVWULDQV HVSHFLDOO\ FKLOGUHQ DQG WKH HOGHUO\ WKRVH LQWHUYLHZHG DV FDU GULYHUVZHUHPRUHOLNHO\WRPHQWLRQEDGURDGWUDIILFRUZHDWKHUFRQGLWLRQV
7KHVDPHFRQGLWLRQVWRJHWKHUZLWKWKH SUHVHQFH RI SHGHVWULDQV ZHUH PHQWLRQHG ZKHQ LQWHUYLHZHHVZHUHDVNHGXQGHUZKDWFLUFXPVWDQFHVGULYHUVVKRXOGGULYHEHORZWKHVSHHG OLPLW7KHOLNHOLKRRGRIHQIRUFHPHQWZDVDOVRPHQWLRQHGDVDUHDVRQIRUGRLQJVR
+LJKVSHHGZDVDOVRPHQWLRQHGE\ERWKJURXSVRILQWHUYLHZHHVDVRQHRIWKHDVSHFWVRI WKHLUXVHRIWKHURDGVWKDWWKH\IHOWZDVGDQJHURXV0RUHWKDQWKUHHILIWKVRIHDFKJURXS VDLG WKDW WKH\ RIWHQ HQFRXQWHUHG GDQJHURXV VLWXDWLRQV 6LPLODU SURSRUWLRQV UHJDUGHG GULYLQJDWKLJKVSHHGDVDJJUHVVLYHDQGDVUHFNOHVVDQGRYHUSHUFHQWUHJDUGHGLWDV GDQJHURXV
7KHUH ZDV DQ DSSUHFLDEOH WHQGHQF\ IRU WKRVH LQWHUYLHZHG DV GULYHUV WR VD\ WKDW WKH\
GURYHVRPHZKDWVORZHUWKDQRWKHUVDQGWKDWWKH\H[FHHGVSHHGOLPLWVOHVVIUHTXHQWO\WKDQ RWKHUVDQGIRUOHVVVHOILVKUHDVRQV
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
$OOLQDOOWKHVHILQGLQJVLQGLFDWHFOHDUGLVVDWLVIDFWLRQZLWKFXUUHQWOHYHOVRIVSHHGDPRQJ GULYHUVWKHPVHOYHVDVZHOODVDPRQJYXOQHUDEOHURDGXVHUVDQGLQWHUPVRIWKHTXDOLW\RI XUEDQOLIHDQGDUHDGLQHVVDWOHDVWLQSULQFLSOHWRVHHVSHHGVUHGXFHG7KLVLQGLFDWHVWKDW QRWZLWKVWDQGLQJFXUUHQWFKRLFHVRIVSHHGE\GULYHUVWKHFOLPDWHIRUVSHHGPDQDJHPHQW SROLFLHVIRUPRGHUDWLQJVSHHGPD\ZHOOEHIDYRXUDEOH
352&('85(72$66,67'(&,6,210$.(56
&21&(51,1*63(('0$1$*(0(17
&217(;7)25'(&,6,210$.,1*
7KHOHYHORIVSHHGRQDVHFWLRQRIURDGLVWKHSURGXFWRILQGLYLGXDOFKRLFHVRIVSHHGE\
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
,WIROORZVWKDWZKHQWKHDXWKRULWLHVUHVSRQVLEOHIRUUHJXODWLRQRIURDG WUDIILF HQJDJH LQ VSHHGPDQDJHPHQWWKDWLVLQSROLFLHVDQGPHDVXUHVWRLQIOXHQFHGULYHUV©FKRLFHRIVSHHG WKH\ DUH XVXDOO\ VHHNLQJ WR UHGXFH VSHHGV DQG WKHUHIRUH WR SHUVXDGH YHKLFOH XVHUV WR IRUHJR VRPH RI WKH SHUFHLYHG DGYDQWDJH WR WKHP RI KLJKHU VSHHGV LQ RUGHU WR UHGXFH VRPHRIWKHOHVVZHOOSHUFHLYHGGLVDGYDQWDJHVWRWKHPVHOYHVDQGPDQ\GLVDGYDQWDJHVWR RWKHUV
,QGRLQJVRWKHDXWKRULWLHVKDYHWRJDLQWKHDFTXLHVFHQFHLIQRWWKHHQWKXVLDVWLFFRQVHQW RIWKHPDMRULW\RIGULYHUVWKDWLVWKHVSHHGPDQDJHPHQWSROLFLHVDQGPHDVXUHVQHHGWR EHDFFHSWDEOHLQWKHEDODQFHWKH\VWULNHEHWZHHQWKHIRUHJRQHDGYDQWDJHWRYHKLFOHVXVHUV DQGWKHFRQFRPLWDQWDGYDQWDJHWRVRFLHW\
,QUHDFKLQJGHFLVLRQVDERXWVSHHGPDQDJHPHQWWKHUHIRUHLWLVKHOSIXOIRUWKHGHFLVLRQ PDNHUV WR EH DV IXOO\ LQIRUPHG DV LV SUDFWLFDEOH DERXW WKH HIIHFWV WKDW DQ\ VSHHG PDQDJHPHQWSROLFLHVDQGPHDVXUHVWKH\DUHFRQVLGHULQJPD\KDYHERWKLQDJJUHJDWHDQG LQ WKHLU GLVWULEXWLRQ RYHU WKH DIIHFWHG SHRSOH 7KLV LV KHOSIXO QRW RQO\ WR WKHLU RZQ GHFLVLRQPDNLQJEXWDOVRLQWKHLUWDVNRIFRQVXOWLQJWKHDIIHFWHGSHRSOHDQGDVVHVVLQJWKH DFFHSWDELOLW\WRWKHPRIWKHHQYLVDJHGSROLFLHVDQGPHDVXUHV
,WLVWRKHOSLQWKLVWKDWWKH0$67(5IUDPHZRUNIRUDVVHVVLQJWKHHIIHFWVRIWUDIILFVSHHG KDVEHHQGHYHORSHGDQGWHVWHGDVUHSRUWHGLQ:RUNLQJ3DSHUDQG'HOLYHUDEOH' .DOOEHUJDQG7RLYDQHQ
)5$0(:25.)2535(6(17$7,212)())(&762)63((' 7KH0$67(5IUDPHZRUNDLPVWREH
• FRPSUHKHQVLYHLQWKHVHQVHWKDWDOOUHOHYDQWHIIHFWVRIVSHHGDUHFRQVLGHUHG
• HDV\WRDSSO\UHFRJQLVLQJWKDWWKLVPD\UHTXLUHVRPHWUDGHRIIZLWKSUHFLVLRQ
• DSSOLFDEOHIURPWKHOHYHORIVLQJOHURDGVHFWLRQVWR WKDW RI ZKROH URDG QHWZRUNV LHIURPWKHOLQNWRWKHQHWZRUNOHYHO
• LQWHUSUHWDEOHLQPRQHWDU\WHUPVDVIDUDVWKHXVHU ZLVKHV DQG ZLWKLQ WKH OLPLWV RI ZKDW LV SUDFWLFDEOH EXW ZLWKRXW H[FOXGLQJ LPSDFWV WKDW DUH KDUG WR H[SUHVV LQ PRQHWDU\WHUPV
• WUDQVSDUHQWLQWKDWWKHEDVHVRIDOOWKHFDOFXODWLRQVDUHPDGHH[SOLFLW
• HDV\ WR DGDSW WR QHZ LQIRUPDWLRQ DERXW WKH LPSDFWV RI VSHHG RU WR GLIIHUHQW YDOXDWLRQVRILWVHIIHFWV
• IOH[LEOHHQRXJKWRDOORZXVHUVWRDSSO\WKHLURZQZHLJKWLQJWRGLIIHUHQWHIIHFWVRI VSHHGDQG
• DEOHWRSUHVHQWLQIRUPDWLRQDERXWWKHGLVWULEXWLRQRILPSDFWVRIVSHHGDV ZHOO DV DERXWDJJUHJDWHLPSDFWV
,WLVLPSOHPHQWHGLQWKHIRUPRI([FHOVSUHDGVKHHWVDVLOOXVWUDWHGLQ WKH $SSHQGLFHV RI 'HOLYHUDEOH'.DOOEHUJDQG7RLYDQHQ
6FRSH
7KH0$67(5IUDPHZRUNDOORZVWKHXVHUWREHJLQE\
• VSHFLI\LQJWKHPHDVXUHRUSROLF\WREHWHVWHG
• GHFLGLQJRQDOLQNRUQHWZRUNOHYHORIDVVHVVPHQWDQG
• GHFLGLQJZKLFKLPSDFWVKRXOGEHLQFOXGHGLQWKHDVVHVVPHQW ,PSDFWVZKLFKFDQEHLQFOXGHGDUH
• DWWKHOLQNOHYHO
− DFFLGHQWV
− H[KDXVWHPLVVLRQV
− QRLVH
− WUDYHOWLPH
− YHKLFOHRSHUDWLQJFRVWVDQG
• DGGLWLRQDOO\DWWKHQHWZRUNOHYHO
− UHURXWLQJ
− FKDQJHRIPRGHRIWUDYHO
− FKDQJHRIGHVWLQDWLRQDQG
− ODQGXVHWUDQVSRUWLQWHUDFWLRQV )RUWKHLQFOXGHGLPSDFWVWKHXVHUWKHQ
• FKRRVHVWKHLPSDFWIXQFWLRQVRUPRGHOVIRUWKHTXDQWLILFDWLRQRILPSDFWVJDWKHUVWKH UHOHYDQW GDWD IRU WKH H[LVWLQJ VLWXDWLRQ DQG PDNHV FRUUHVSRQGLQJ HVWLPDWHV IRU WKH QHZVLWXDWLRQZLWKWKHPHDVXUHRUSROLF\EHLQJFRQVLGHUHGLQRSHUDWLRQ
• GHFLGHV ZKLFK LPSDFWV WR H[SUHVV LQ WHUPV RI PRQH\ DQG DW ZKLFK PRQHWDU\
YDOXDWLRQV
• PDNHVWKHFDOFXODWLRQVDQG
• DQDO\VHVDQGGHVFULEHVWKHQRQTXDQWLILDEOHHIIHFWV 7KHXVHULVWKHQUHDG\WR
• VXPPDULVHWKHQHWLPSDFWVRIWKHSROLF\RUPHDVXUHV
• VHWRXWWKHGLVWULEXWLRQDOHIIHFWV
• PDNHVHQVLWLYLW\WHVWVZLWKUHVSHFWWRNH\DVVXPSWLRQVDQGLQSXWYDOXHV
• LIWKHUHVXOWVDUHVXIILFLHQWO\IDYRXUDEOHWRWKHSROLF\RUPHDVXUHIRULWWREHZRUWK LQYHVWLJDWLQJLWVDFFHSWDELOLW\XVHWKHUHVXOWVWRDVVLVWWKHSURFHVVRIFRQVXOWLQJWKH DIIHFWHGSHRSOHDERXWLWVDFFHSWDELOLW\DQG
• XVHWKHUHVXOWVWRJHWKHUZLWKWKHRXWFRPHRIFRQVXOWDWLRQZLWKWKHDIIHFWHGSHRSOHWR DVVLVWLQWKHGHFLVLRQZKHWKHUWRJRDKHDGZLWKWKHSROLF\RUPHDVXUH
7KHIUDPHZRUN FDQ LQ SULQFLSOH EH XVHG WR DVVHVV DQ\ PHDVXUH RU SROLF\ UDQJLQJ IURP PRGHUDWLQJWKHVSHHGVRIWKHIDVWHVWIHZSHUFHQWRIYHKLFOHVRQRQHSDUWLFXODUVHFWLRQRI URDG WR D SROLF\ IRU UHGXFLQJ WKH VSHHGV RQ DOO NLQGV RI URDG WKURXJKRXW D UHJLRQ RU FRXQWU\
/LPLWDWLRQV
7KHOLPLWDWLRQVRQWKHXVHRIWKHIUDPHZRUNOLHODUJHO\LQWKHDELOLW\RIWKHXVHUWRVSHFLI\
LPSDFWIXQFWLRQVDQGPRGHOVDQGDVVHPEOHWKHUDQJHRIGDWDQHHGHGWRLPSOHPHQWWKHVH IXQFWLRQV DQG PRGHOV DV UHTXLUHG WR UHSUHVHQW WKH LPSDFWV WR D OHYHO RI GHWDLO DQG SUHFLVLRQ WKDW WKH XVHU WKH GHFLVLRQPDNHUV FRQFHUQHG DQG WKH DIIHFWHG SHRSOH EHLQJ FRQVXOWHGZLOOILQGDGHTXDWHLQWKHFRQWH[WRIWKHSROLF\RUPHDVXUHEHLQJFRQVLGHUHG (DUOLHU FKDSWHUV RI WKLV UHSRUW DQG WKH :RUNLQJ 3DSHUV DQG 'HOLYHUDEOHV VXPPDULVHG KHUHKDYHGHPRQVWUDWHGWKDWDUDQJHRIUHOHYDQWPRGHOVDQGGDWDH[LVW WKDW HQDEOH WKH VSHHGGHSHQGHQFH RI D UDQJH RI UHOHYDQW LPSDFWV RI WUDIILF WR EH TXDQWLILHG DW WKH OLQN OHYHOEXWWKDWE\QRPHDQVDOORIWKLVLQIRUPDWLRQLVLQIRUPVWKDWDUHUHDGLO\DFFHVVLEOHWR SRWHQWLDOXVHUVRIWKH0$67(5IUDPHZRUN
$W WKH QHWZRUN OHYHO WKH XVHU RI WKH IUDPHZRUN ZLOO QHHG WR LPSOHPHQW DSSURSULDWH DVVLJQPHQW PRGH FKRLFH GHVWLQDWLRQ FKRLFH RU HYHQ ODQGXVH WUDQVSRUW LQWHUDFWLRQ PRGHOVWRHVWLPDWHUHYLVHGIORZVRIWUDIILFRQDOODIIHFWHGOLQNVEHIRUHDSSO\LQJOLQNEDVHG PRGHOVRIWKHYDULRXVLPSDFWV
$33/,&$7,212)7+()5$0(:25.
$SSOLFDWLRQLQORFDOUHJLRQDOQDWLRQDODQGLQWHUQDWLRQDOFRQWH[WV ,QDFFRUGDQFHZLWKWKHSULQFLSOHRIVXEVLGLDULW\VSHHGPDQDJHPHQWH[FHSWSRVVLEO\RQ WKH7UDQV(XURSHDQ5RDG1HWZRUN7(51ZLOOIRUWKHIRUHVHHDEOHIXWXUHEHDPDWWHUIRU WKH0HPEHU6WDWHV0RUHRYHULQPDQ\0HPEHU6WDWHVWKHUHVSRQVLELOLW\IRUUHJXODWLRQ RI PXFK RI WKH URDG V\VWHP LV GHOHJDWHG WR UHJLRQDO RU ORFDO DXWKRULWLHV DQG PDQ\
GHFLVLRQVDERXWVSHHGPDQDJHPHQWZLOOWKHUHIRUHEHWDNHQE\WKHVHDXWKRULWLHV)RUWKH IUDPHZRUN WR EH XVHIXO WR WKHP LW ZLOO QHHG WR EH PDGH DYDLODEOH DV D SLHFH RI XVHU IULHQGO\ VRIWZDUH WRJHWKHU ZLWK FOHDU JXLGHOLQHV RQ LWV XVH LQFOXGLQJ WKH FKRLFH RI IXQFWLRQVDQGPRGHOVIRUWKHYDULRXV LPSDFWV DQG WKH JDWKHULQJ RI VXLWDEOH GDWD 6RPH DXWKRULWLHVZLOOZLVKWRDSSO\WKHIUDPHZRUNWKHPVHOYHVRWKHUVZLOOZLVKWRFRPPLVVLRQ FRQVXOWDQWVWRDSSO\LWIRUWKHP
1DWLRQDO JRYHUQPHQWV RU WKHLU DJHQFLHV PD\ ZHOO ZLVK WR DSSO\ WKH IUDPHZRUN WR QDWLRQDOO\ IXQGHG URDG QHWZRUNV RU WR H[DPLQH WKH IHDVLELOLW\ RI QDWLRQDO SROLFLHV IRU VSHHGPDQDJHPHQWRQRWKHUURDGV
$W WKH OHYHO RI WKH (8 WKH IUDPHZRUN PLJKW EH XVHG WR H[DPLQH SROLFLHV IRU VSHHG PDQDJHPHQWRQWKH7(51EXWWKHPDLQUROHRIWKH(8LQUHVSHFWRIWKHIUDPHZRUNPD\
ZHOOEHWRXVHLWWRSURPRWHVSHHGPDQDJHPHQWDFURVVWKH(8E\DUUDQJLQJIRULWWREH PDGH DYDLODEOH LQ D ZLGHO\ XVDEOH IRUP ZLWK DVVRFLDWHG IXQFWLRQV DQG PRGHOV IRU WKH YDULRXVLPSDFWVDQG FRUUHVSRQGLQJ VSHFLILFDWLRQV RI WKH UHTXLUHG GDWD 7HVWLQJ RI WKH IUDPHZRUN LQ WKUHH GLIIHUHQW FRXQWULHV DV UHSRUWHG E\ .DOOEHUJ DQG 7RLYDQHQ LQGLFDWHVWKDWWKLVVKRXOGEHIHDVLEOHWKRXJKLWZLOOUHTXLUHVXEVWDQWLDOLQYHVWPHQW,Q WKLVZD\WKH(8ZRXOGDGGYDOXHWRWKHVHSDUDWHHIIRUWVRILQGLYLGXDO0HPEHU6WDWHVLQ WKHILHOGRIVSHHGPDQDJHPHQW
$SSOLFDWLRQWRGLIIHUHQWW\SHVRIURDG
,WVKRXOGEHFOHDUIURPWKHVXPPDU\LQ6HFWLRQWKDWWKHIUDPHZRUNLVDGDSWHGIRU DSSOLFDWLRQ WR HYHU\ W\SH RI URDG IURP WKH UHVLGHQWLDO DFFHVV URDG WR WKH PXOWLODQH PRWRUZD\ 7KH GLIIHUHQFHV EHWZHHQ DSSOLFDWLRQV WR GLIIHUHQW NLQGV RI URDG OLH LQ WKH FKRLFH EHWZHHQ OLQN DQG QHWZRUN OHYHOV GHFLGLQJ ZKLFK LPSDFWV DUH UHOHYDQW DQG FKRRVLQJ DSSURSULDWH IXQFWLRQV DQG PRGHOV IRU WKHVH LPSDFWV DFFRUGLQJ WR WKH W\SH RI URDG
86(2)7+(2873876,1'(&,6,210$.,1*
7ZRXVHVRIWKHRXWSXWVIURP WKH 0$67(5 IUDPHZRUN LQ GHFLVLRQPDNLQJ KDYH EHHQ LGHQWLILHG2QHLVWRDVVLVWWKHSURFHVVRIFRQVXOWDWLRQZLWKSHRSOHZKRZLOOEHDIIHFWHG E\ D SURSRVHG VSHHG PDQDJHPHQW PHDVXUH RU SROLF\ ZLWK D YLHZ WR DVVHVVLQJ WKH DFFHSWDELOLW\RIWKHSURSRVHGPHDVXUHRUSROLF\,QFRQVXOWLQJVXFKSHRSOHLWVKRXOGEH
KHOSIXOWREHDEOHWRPDNHDYDLODEOHWR WKHP WKH UHVXOWV RI D WUDQVSDUHQW SURFHGXUH IRU DVVHVVLQJWKHOLNHO\LPSDFWVDQGWKHLUGLVWULEXWLRQ
7KHVHFRQGXVHRIWKHRXWSXWVIURPWKHIUDPHZRUNLVLQWKHVXEVHTXHQWGHFLVLRQWDNLQJ LWVHOI 7KLV VKRXOG EH DVVLVWHG E\ EHLQJ LQIRUPHG E\ WKH RXWSXWV IURP WKH IUDPHZRUN ZKLFKZLOOWKHQEHFRQVLGHUHGDORQJVLGHWKHUHVXOWVRISXEOLFFRQVXOWDWLRQDQGDQ\RWKHU UHOHYDQW PDWHULDO RU FRQVLGHUDWLRQV ZKLFK WKH GHFLVLRQPDNHUV FKRRVH WR WDNH LQWR DFFRXQWLQH[HUFLVLQJWKHLUMXGJHPHQWDQGSROLWLFDOUHVSRQVLELOLWLHV
,Q QR ZD\ LV WKH IUDPHZRUN LQWHQGHG WR VXEVWLWXWH IRU WKH MXGJHPHQW RI WKH GHFLVLRQ PDNHUV,WLVDWRROWRKHOSWKHPWRH[HUFLVHWKDWMXGJHPHQWPRUHHIIHFWLYHO\E\EHLQJ EHWWHU LQIRUPHG DERXW VRPH RI WKH SULQFLSDO OLNHO\ FRQVHTXHQFHV RI D GHFLVLRQ WR JR DKHDGZLWKDQ\SURSRVHGPHDVXUHRUSROLF\IRUVSHHGPDQDJHPHQW
&21&/86,21
:RUNZLWKLQ:RUN$UHDRI0$67(5KDVSURYLGHGDIUDPHZRUNIRUWKHSUHVHQWDWLRQ WR SRWHQWLDOO\ DIIHFWHG SHRSOH DQG WR GHFLVLRQPDNHUV RI WKH UDQJH DQG GLVWULEXWLRQ RI OLNHO\ HIIHFWV RI VSHHG PDQDJHPHQW PHDVXUHV DFKLHYLQJ DQ\ SDUWLFXODU WDUJHW OHYHO RI VSHHG RQ DQ\ SDUWLFXODU URDG VHFWLRQ RU RI VSHHG PDQDJHPHQW SROLFLHV DFKLHYLQJ DQ\
SDUWLFXODU PL[ RI WDUJHW OHYHOV RI VSHHG RQ URDGV RI GLIIHUHQW NLQGV WKURXJK D URDG QHWZRUN7KHIUDPHZRUNLVWUDQVSDUHQWDQGLVIOH[LEOHLQDOORZLQJXVHUVWRGHFLGHWKH ZHLJKWLQJVWREHDWWDFKHGWRGLIIHUHQWHIIHFWVDQGZKLFKDUHWREHH[SUHVVHGLQPRQHWDU\
WHUPV,WLVHDV\WRDSSO\RQFHWKHXVHUKDGGHFLGHGZKLFKHIIHFWVRIVSHHG DUH WR EH LQFOXGHG DQG RQ WKH EDVLV RI ZKLFK IXQFWLRQV RU PRGHOV DQG ZKDW FRUUHVSRQGLQJ GDWD 7KH IUDPHZRUN LV IOH[LEOH LQ WHUPV RI WKH XVHU©V FKRLFH DPRQJ H[LVWLQJ IXQFWLRQV DQG PRGHOVDQGZLWKUHVSHFWWRQHZIXQFWLRQVDQGPRGHOVWKDWPD\EHFRPHDYDLODEOHLQWKH IXWXUH
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
:RUN LQ :RUN $UHD RI 0$67(5 RQ WKH DFFHSWDELOLW\ RI FXUUHQW OHYHOV RI VSHHG VXJJHVWVWKDWWKHFOLPDWHRIRSLQLRQRIGULYHUVDVZHOODVYXOQHUDEOHURDGXVHUVPD\ZHOO EHIDYRXUDEOHWRVSHHGPDQDJHPHQWWRPRGHUDWHVSHHGV
$&.12:/('*(0(176
7KHOHDGHUIRU:RUN$UHDRI0$67(5ZDV+HDWKHU:DUG6KHDQGWKHDXWKRUZLVK WRUHFRUGWKHLUUHFRJQLWLRQRIWKHHIIRUWVRIDOOWKHFROOHDJXHVZKR KDYH FRQWULEXWHG WR WKLV ZRUN DUHD *$QGHUVVRQ $%DUX\D 8+DPPDUVWU|P 93.DOOEHUJ '$/\QDP
*0DUVGHQ &*%0LWFKHOO 6$5REHUWVRQ 86DQGEHUJ DQG 67RLYDQHQ 7KLV UHSRUW DOVR GUDZV XSRQ WKH ZRUN RI 55LVVHU DQG 8/HKQHU LQ :RUN $UHD 7KH DXWKRU LV JUDWHIXOWR6DVNLD)U\IRUZRUGSURFHVVLQJWKLVZRUNLQJSDSHU
5()(5(1&(6
$%%277 3* +$57/(< 6 +,&.0$1 $- /$<),(/' 5( 0F&5$( ,6 1(/621 30 3+,//,36 60 DQG :,/621 -/ 7KH HQYLURQPHQWDO DVVHVVPHQW RI WUDIILF PDQDJHPHQW VFKHPHV $ OLWHUDWXUH UHYLHZ 75/ 5HSRUW 7UDQVSRUW5HVHDUFK/DERUDWRU\&URZWKRUQH
$1'(56621 * DQG 1,/6621 * 6SHHG PDQDJHPHQW LQ 6ZHGHQ 6ZHGLVK 1DWLRQDO5RDGDQG7UDQVSRUW,QVWLWXWH97,/LQN|SLQJ
%$5/2: 7 02'(0 HPLVVLRQV PRGHO FRPSXWHU SURJUDPPH XVHU PDQXDO YHUVLRQ7UDQVSRUW5HVHDUFK/DERUDWRU\&URZWKRUQH
%$58<$ $ $ UHYLHZ RI VSHHGDFFLGHQW UHODWLRQVKLS IRU (XURSHDQ URDGV 0$67(5:RUNLQJ3DSHU
%$58<$ $ D 0$67(5 6SHHGDFFLGHQW UHODWLRQVKLS RQ UXUDO VLQJOH FDUULDJHZD\URDGVRI8.0$67(5:RUNLQJ3DSHU
%$58<$ $ E 0$67(5 6SHHGDFFLGHQW UHODWLRQVKLS RQ (XURSHDQ URDGV 0$67(5:RUNLQJ3DSHU
%$58<$ $ F 0$67(5 6SHHGDFFLGHQW UHODWLRQVKLS RQ GLIIHUHQW NLQGV RI (XURSHDQURDGV0$67(5'HOLYHUDEOH'
%$58<$ $ DQG ),1&+ '- ,QYHVWLJDWLRQ RI WUDIILF VSHHGV DQG DFFLGHQWV RQ XUEDQ URDGV 3URFHHGLQJV RI WKH QG (XURSHDQ 7UDQVSRUW )RUXP 8QLYHUVLW\ RI :DUZLFN375&/RQGRQ
&200,66,212)7+((8523($1&20081,7,(63URPRWLQJURDGVDIHW\
LQWKH(8WKHSURJUDPPHIRU&20ILQDO%UXVVHOV
(**/(6721+6*25,66(11-280$5'55,-.(%2(55&6$05$6=
DQG =,(52&. .+ &25,1$,5 :RUNLQJ *URXS RQ HPLVVLRQ IDFWRUV IRU FDOFXODWLQJ HPLVVLRQV IURP URDG WUDIILF 9ROXPH PHWKRGRORJ\ DQG HPLVVLRQV IDFWRUV(85(1&(&%UXVVHOV
(8523($1 75$163257 6$)(7< &281&,/ 5HGXFLQJ WUDIILF LQMXULHV UHVXOWLQJIURPH[FHVVDQGLQDSSURSULDWHVSHHG(76&%UXVVHOV
(8523($1 3$5/,$0(17 5HSRUW IURP WKH &RPPLWWHH RQ 7UDQVSRUW DQG 7RXULVP3(ILQ6WUDVERXUJ
),1&+'-.203)1(53/2&.:22'&5DQG 0$<&2&. * 6SHHG VSHHG OLPLWV DQG DFFLGHQWV 3URMHFW 5HSRUW 7UDQVSRUW 5HVHDUFK /DERUDWRU\
&URZWKRUQH
*$5%(51-DQG*$',5$856SHHGYDULDQFHDQGLWVLQIOXHQFHRQDFFLGHQWV
$$$)RXQGDWLRQIRU7UDIILF6DIHW\:DVKLQJWRQ'&
+$00$5675g0 8 DQG .$5/6621 % 9(72 D FRPSXWHU SURJUDP IRU FDOFXODWLRQ RI WUDQVSRUW FRVWV DV D IXQFWLRQ RI URDG VWDQGDUG 6ZHGLVK 5RDG DQG 7UDQVSRUW,QVWLWXWH97,/LQN|SLQJ
-2673+$66(/':(%(5)-DQG6211%251.6(PLVVLRQDQGIXHO FRQVXPSWLRQPRGHOOLQJEDVHGRQFRQWLQXRXVPHDVXUHPHQWV(8'5,9(SURMHFW9 02'(0'HOLYHUDEOH
.$//%(5* 93 DQG 72,9$1(1 6 )UDPHZRUN IRU DVVHVVLQJ WKH HIIHFWV RI VSHHG0$67(5:RUNLQJ3DSHU
.$//%(5* 93 DQG 72,9$1(1 6 ,PSDFWV RI VSHHG LQ URDG WUDQVSRUW $ IUDPHZRUNIRUFRPSUHKHQVLYHDVVHVVPHQW0$67(5'HOLYHUDEOH'
0F&8//$*+ 3 DQG 1(/'(5 -$ *HQHUDOLVHG OLQHDU PRGHOV QG (GLWLRQ
&KDSPDQDQG+DOO/RQGRQ
0(7= 1 6&+/,&+7(5 + DQG 6&+(//(1%(5* + 3RVLWLYH HIIHFWV RI D WUDIILF FRQWURO V\VWHP RQ IXHO FRQVXPSWLRQ DQG H[KDXVW HPLVVLRQV RQ WKH *HUPDQ $
$XWREDKQ,QW-RI9HKLFOH'HVLJQ
1(/621 3 HG 7UDQVSRUWDWLRQ QRLVH UHIHUHQFH ERRN %XWWHUZRUWK /RQGRQ 6HFWLRQ
5,66(55DQG/(+1(58$FFHSWDELOLW\RIVSHHGVDQGVSHHGOLPLWVWRGULYHUV DQGSHGHVWULDQVF\FOLVWV0$67(5'HOLYHUDEOH'
52%(57621 6$ DQG :$5' +$ 9DOXDWLRQ RI QRQDFFLGHQW LPSDFWV RI VSHHG0$67(5:RUNLQJ3DSHU
52%(576216$:$5'+$0$56'(1*6$1'%(5*8DQG +$00$5 675g087KHHIIHFWRIVSHHGRQQRLVHYLEUDWLRQDQGHPLVVLRQVIURPYHKLFOHV 0$67(5:RUNLQJ3DSHU
9$1 '(5 +2567 5 )DFWRUV LQIOXHQFLQJ GULYHUV© VSHHG EHKDYLRXU DQG DGDSWDWLRQ0$67(5:RUNLQJ3DSHU
7(0$125'5RDGWUDIILFQRLVH1RUGLFSUHGLFWLRQPRGHO7HPD1RUG 1RUGLF&RXQFLORI0LQLVWHUV1RUGLF3XEOLVKLQJ+RXVH
75,9(&725%XOOHU9b*6RIWZDUHSURGXFHGE\7ULYHFWRU$%/XQG 9$1 /((8:(1 - - $ 0$19(// ' DQG 127$ 5 6RPH SUHGLFWLRQ PRGHOVIRUWKHFDOFXODWLRQRIWUDIILFQRLVHLQWKHHQYLURQPHQW3URFHHGLQJVRI,QWHU1RLVH /LYHUSRRO
0RGHOVIRUPHDQVSHHGDQGQXPEHURILQMXU\DFFLGHQWVSHU\HDURQVWUHWFKHVRIVLQJOH FDUULDJHZD\UXUDOURDGLQ(QJODQG
7KHPHDQVSHHGZDVIRXQGWREHHVWLPDWHGLQNPKE\
[H[S[VSHHGOLPLWLQNPK [SHUFHQWDJHH[FHHGLQJWKHVSHHGOLPLW [SHUFHQWDJHEHORZKDOIWKHVSHHGOLPLW− [IORZLQYHKLFOHVGD\−
7KHQXPEHURILQMXU\DFFLGHQWVSHU\HDUZDVIRXQGWREHHVWLPDWHGE\
[ [PHDQVSHHGLQNPK−
[SHUFHQWDJHH[FHHGLQJWKHVSHHGOLPLW [SHUFHQWDJHEHORZKDOIWKHVSHHGOLPLW− [IORZLQYHKLFOHVGD\
[H[S[QXPEHURIMXQFWLRQV
$OOWKHSDUDPHWHUVLQWKHVHPRGHOVDUHVWDWLVWLFDOO\VLJQLILFDQWDWWKHSHUFHQWOHYHORU EHWWHU DQG PRVW RI WKHP DW PXFK KLJKHU OHYHOV 7KH SDUDPHWHUV DVVRFLDWHG ZLWK WKH YDULDEOHV GHVFULELQJ WKH VSHHG GLVWULEXWLRQ DUH DOO VWDWLVWLFDOO\ VLJQLILFDQW DW WKH SHU FHQWOHYHORUEHWWHU
