Managerial evaluation of exogenous forecast sources

This paper concerns the managerial evaluation of forecast vendors—individuals or firms offering for sale future forecasts of random variables relevant to managerial decision making. Assuming the forecasts are exogenous in the sense they are generated by a methodology unknown or unproven to management, the paper uses a logistic regression model to present a statistical test for informativeness that allows for an interpretation of the vendor's abilities. The advantage of the approach is that it requires as input only knowledge of the unconditional probability distribution of the variable being forecast and a relatively small historical track record of the vendor's forecasting performance. No benchmark forecast is necessary and few assumptions are required about the statistical process that generates the forecasts. As an illustrative empirical application, the paper presents an evaluation of the informativeness of the published long-range price forecasts by a veteran analyst of the Iowa hog market.     

Innovative practices in public procurement partnerships: The case of the United States

Public procurement partnerships represent a new approach to conducting government acquisition. These partnerships are predicated on the notion that governments today simply lack the requisite knowledge, skills and financing to provide core public services and acquire sophisticated services, IT and knowledge development by themselves. Instead, governments need to enlist the collective energies of the governmental, business and non-profit (third) sectors. This research looks at the concept of public procurement partnerships in the United States and the major trends promoting their use. Two case examples of public procurement partnerships are presented; one from the perspective of a government partner, the other from the perspective of a private (third) sector partner.     

The Sensitivity of the General Price Level to Changes in the Price of Crude Oil

There are many direct and indirect effects of changing crude oil prices on the inflation rate, so it is not surprising that there are different views about the resulting effects on the general price level and also on other aspects of the general economy. This study, estimates the direct and indirect effects of oil price changes on the economy-wide rate of inflation, which then has effects on spending and producing decisions. However, in this forum, we do not try to estimate the full indirect effects on the level of economic activity, such as effects on real GDP. JEL Classification E310, E370     

How noise matters

Recent advances in evolutionary game theory have introduced noise into decisionmaking to select in favor of certain equilibria in coordination games. Noisy decisionmaking is justified on bounded rationality grounds, and consequently the sources of noise are left unmodelled. This methodological approach can only be successful if the results do not depend too much on the nature of the noise process. This paper investigates invariance to noise of these results, both for the random matching paradigm that has characterized much of the recent literature and for a larger class of two-strategy population games where payoffs may vary non-linearly with the distribution of strategies among the population. Several parametrizations of noise reduction are investigated. The results show that a symmetry property of the noise process and, in the case of non-linear payoffs, bounds on the asymmetry of the payoff functions suffice to preserve the known stochastic stability results.     

Entrepreneurs: Invent a new brand name or revive an old one?

This paper discusses launching an entrepreneurial venture by acquiring a once popular brand name and reviving it. Interviews were conducted with 10 executives who acquired dormant brands and successfully relaunched them into the market. Their comments suggest that, with proper planning, an entrepreneur may be able to substantially increase his or her chances of success by reviving brands, rather than spending the enormous amount of capital required to build new brand image. Conclusions suggest that nostalgia targeting is not enough; the revived brand must be repositioned to satisfy today's customer values. Evidence also suggests licensing a revived brand name to unrelated industries may prove very profitable for the entrepreneur.