discrete event simulation and bookkeeping
Okay, this is an old (Halpin 1986?) discrete event simulation model. There's various entities which together are building something out of concrete.
The truck goes: fill with concrete (needs a slot at the plant), haul to the site, fill the hoist (needs a hoist), back for more
The hoist goes: get filled, hoist up, load the hopper, back down
The hopper goes: get filled, fill the buggy, return
The buggy goes: get filled, place the concrete, return
What if these entities were businesses, and needed to keep accounting books?
That is, the truck business would a general ledger that has entries for each activity. Resources normally have positive value, so money normally goes in the opposite direction of resources. Maybe the truck business might have one asset account for "empty trucks outside the plant", another for "full trucks near the plant", a third for "full trucks near the site", a fourth for "empty trucks near the site". What about revenue and expense accounts?
From the other perspective, would the hoist business perceive itself as buying and selling trucks? Or the right to a truck? What markets would have to be in place? A truck-owning business with a full truck and a hoist-owning business with an empty hoist ought to be able to engage in a mutually beneficial interaction where the truck-owning business goes away with an empty truck (and some cash) and the hoist-owning business goes away with a full hoist. Suppose that contract was called a 'fill', then there could be a market for fills and speculators in the market for fills. The contract would have a standard orientation. Since the money is moving from the hoist-owning company to the truck-owning company, we would probably say that the hoist-owning company is buying a fill, and the truck-owning company is selling a fill.
So on the truck-owning company's ledger, selling a fill looks like an increase to cash, a decrease to the revenue account (fills), a decrease of full-trucks-near-the-site and an increase of empty-trucks-near-the-site. On the hoist-owning company's ledger, buying a fill looks looks like a decrease to cash, a increase to the expense account (fills), a decrease of empty-hoists-at-bottom, and an increase of full-hoists-at-bottom. Everything is symmetrical.
Suppose that there is a continuous double auction for fills on each side (the hoist side and the plant side), and the truck company acts as a price taker in both auctions. The truck arrives near the site, and immediately sells a fill, probably to a speculator. Then the truck might immediately execute, or it might waits until the speculator manages to sell the fill to a hoist and then execute. Then the truck goes back, and buys a fill, probably from a speculator, and possibly waits.
If the truck company holds the behavior constant, and can act as a price taker, and can make a living, then its ledger accumulates information (prices and durations). It can use its records, together with a discounting rate, to generate prices. What is the correct (internal) valuation for a 'full-truck-near-the-site'? Well, if you have a long, regular log, then you can look for times when you had a 'full-truck-near-the-site', and the pattern of cash flows revenues and expenses that occurred subsequently. That cash flow pattern can be wound backwards using discounting to create a net-present-value of a 'full-truck-near-the-site'.
If you have internal valuations, then you might be able to start acting as a price setter rather than a price taker. To set a price on a fill, then you look at your valuation of the situation after executing the fill, and your valuation of the current situation. Those will in general be different, and the difference is a reasonable price.
The truck goes: fill with concrete (needs a slot at the plant), haul to the site, fill the hoist (needs a hoist), back for more
The hoist goes: get filled, hoist up, load the hopper, back down
The hopper goes: get filled, fill the buggy, return
The buggy goes: get filled, place the concrete, return
What if these entities were businesses, and needed to keep accounting books?
That is, the truck business would a general ledger that has entries for each activity. Resources normally have positive value, so money normally goes in the opposite direction of resources. Maybe the truck business might have one asset account for "empty trucks outside the plant", another for "full trucks near the plant", a third for "full trucks near the site", a fourth for "empty trucks near the site". What about revenue and expense accounts?
From the other perspective, would the hoist business perceive itself as buying and selling trucks? Or the right to a truck? What markets would have to be in place? A truck-owning business with a full truck and a hoist-owning business with an empty hoist ought to be able to engage in a mutually beneficial interaction where the truck-owning business goes away with an empty truck (and some cash) and the hoist-owning business goes away with a full hoist. Suppose that contract was called a 'fill', then there could be a market for fills and speculators in the market for fills. The contract would have a standard orientation. Since the money is moving from the hoist-owning company to the truck-owning company, we would probably say that the hoist-owning company is buying a fill, and the truck-owning company is selling a fill.
So on the truck-owning company's ledger, selling a fill looks like an increase to cash, a decrease to the revenue account (fills), a decrease of full-trucks-near-the-site and an increase of empty-trucks-near-the-site. On the hoist-owning company's ledger, buying a fill looks looks like a decrease to cash, a increase to the expense account (fills), a decrease of empty-hoists-at-bottom, and an increase of full-hoists-at-bottom. Everything is symmetrical.
Suppose that there is a continuous double auction for fills on each side (the hoist side and the plant side), and the truck company acts as a price taker in both auctions. The truck arrives near the site, and immediately sells a fill, probably to a speculator. Then the truck might immediately execute, or it might waits until the speculator manages to sell the fill to a hoist and then execute. Then the truck goes back, and buys a fill, probably from a speculator, and possibly waits.
If the truck company holds the behavior constant, and can act as a price taker, and can make a living, then its ledger accumulates information (prices and durations). It can use its records, together with a discounting rate, to generate prices. What is the correct (internal) valuation for a 'full-truck-near-the-site'? Well, if you have a long, regular log, then you can look for times when you had a 'full-truck-near-the-site', and the pattern of cash flows revenues and expenses that occurred subsequently. That cash flow pattern can be wound backwards using discounting to create a net-present-value of a 'full-truck-near-the-site'.
If you have internal valuations, then you might be able to start acting as a price setter rather than a price taker. To set a price on a fill, then you look at your valuation of the situation after executing the fill, and your valuation of the current situation. Those will in general be different, and the difference is a reasonable price.