Applying the combinatorial retention auction mechanism (CRAM) to a cost-benefit analysis of the post 9/11 era GI Bill transferability benefit
Lay, Richard H.
MetadataShow full item record
This research determined the costs, benefits and efficiency of the Post 9/11 Era GI Bill Transferability benefit by simulating four different retention mechanisms and comparing the cost of each to provide desired retention levels among a population of sailors who valued the Transferability benefit more than or less than the Cost of the mechanisms investigated were a purely monetary auction, a Universal Incentive Package (UIP) Auction, and the Combinatorial Retention Auction Mechanism (CRAM). All three mechanisms were simulated, data were analyzed and results were compared. The CRAM clearly showed it was the most efficient method for meeting retention objectives while constraining Costs to the Navy as much as possible. Cost savings to the Navy ranged from 27% to 51% over Cash Only Selective Reenlistment Bonuses (SRB). Furthermore, this report confirms that an across-the-board benefit such as GI Bill Transferability significantly reduces the positive surplus when sailors who have a Value of Transferability less than the Cost of Transferability nonetheless exploit this benefit. Maintaining the status quo SRB policy combined with the estimated negative retention effects of the GI Bill Transferability benefit only magnifies the cost ineffectiveness of the Post 9/11 Era GI Bill.
Approved for public release, distribution unlimited
Showing items related by title, author, creator and subject.
Kelso, Eric W. (Monterey, California: Naval Postgraduate School, 2014-06);Aviation Career Continuation Pay (ACCP), the retention bonus for Naval Aviators, has historically failed to meet stated retention goals. For fiscal year 2013 Naval Personnel Command reported that ACCP exceeded retention ...
Using a second-price auction to set military retention bonus levels an application to the Australian Army Cook, Benjamin M. (Monterey California. Naval Postgraduate School, 2008-03);The Australian Army is attempting to improve retention rates, announcing a number of retention bonuses in 2007. In a service that has rarely used retention bonuses
Increasing the effectiveness of Navy retention compensation by evaluating different auction compensation formats Triplett, Terry W.; Winters, Michael K. (Monterey, California: Naval Postgraduate School, 2015-06);With the U.S. military under intense scrutiny to cut costs, the Department of Defense must determine ways to use its limited resources more efficiently. One financial incentive ripe for change is the retention bonus. This ...