The Tail Probability of Discounted Sums of Pareto-like Losses in Insurance

In an insurance context, the discounted sum of losses within a finite or infinite time period can be described as a randomly weighted sum of a sequence of independent random variables. These independent random variables represent the amounts of losses in successive development years, while the weights represent the stochastic discount factors. In this paper, we investigate the problem of approximating the tail probability of this weighted sum in the case when the losses have Pareto-like distributions and the discount factors are mutually dependent. We also give some simulation results.     

An alternative solution method for goal programming problems: The lexicographic goal programming case

This article provides an example of the use of an alternative goal programming solution procedure. The solution procedure is applied to solve a lexicographic goal programming problem. In the process of illustrating the problem, a number of unique technical problems and their solution procedures are discussed. This study provides a flowchart as a procedural guide to aid in its use. This article also provides a comparative analysis of GP algorithms. The results demonstrate the tableau element reduction capabilities of the proposed alternative goal programming solution procedure.     

Some Implications of the Philosophy of Technology for Science, Technology and Society (STS) Studies

Technology is frequently considered in terms of its impact on entities outside its essential nature: as the impact of technology on the environment and society, but also the impact of human values and needs on technology. By taking particular social implications of technology into account, the Science–Technology relationship can be extended to the field of Science, Technology and Society (STS) studies. STS studies are grounded in socio-technological understanding, that is, systematic knowledge of the mutual relationship between technical objects, the natural environment and social practice. Because technology is a key element of STS, it is expected that the philosophy of technology will have implications for STS studies. The dynamic nature of technology as such leaves its own philosophy in a tentative or flexible state. However, the implications of the philosophy of technology, being in a development phase at the moment with changes in emphasis occuring, for STS studies ought to be determined continuously. The aim of the article is to identify and discuss possible implications of the the philosophy of technology for STS. In order to deduce these implications, the relevant theoretical framework underpinning the article will be discussed in broad outlines. Seeing that the philosophy of technology is such a wide field a delineation of the field needs to be done. Mitcham’s proposed preliminary framework is taken as point of departure for the article. Technology as knowledge (epistemology/theory of knowledge) and technology as activity (design methodology) will be discussed as two key aspects of the modern philosophy of technology which could provide implications for STS. A theory of knowledge usually includes methodology, but seeing that Mitcham classified methodology as one of the modes in which technology is manifested, it is dealt with separately. The epistemology and methodology of technology will each be discussed from a philosophical, historical and practice-based methodological perspective. Some implications of the philosophy for STS are identified and discussed.     

Does Working Capital Management Affect Profitability of Belgian Firms?

The relation between working capital management and corporate profitablity is investigated for a sample of 1,009 large Belgian non-financial firms for the 1992-1996 period. Trade credit policy and inventory policy are measured by number of days accounts receivable, accounts payable and inventories, and the cash conversion cycle is used as a comprehensice measure of working capital management. The results suggest that managers can increase corporate profitablity by reducing the number of days accounts receivable and inventories. Less profitable firms wait longer to pay their bills.     

Macroeconomic News and Mortgage Rates

The study analyzes the influence of macroeconomic news announcements on (a) interest rates for commercial mortgages, residential mortgages, 10-year Treasury notes, and Baa-rated corporate bonds; and (b) corresponding mortgage spreads. It is both interesting and highly relevant from a policy and portfolio management standpoint to examine the implications of the influence of macroeconomic news announcements on mortgage markets. Some important results are reported. First, consistent with the notion of market integration, mortgage rates are found to be co-integrated with other capital market instruments. Second, of the 22 types of periodic macroeconomic news releases considered, 13 of them have a significant influence on at least one of the interest rates, and notably changes in hourly earnings and housing starts significantly influence all debt-security yields. More generally, macroeconomic news that conveys higher inflation and/or economic growth has a positive influence on mortgage and other interest rates. Finally, this study finds several announcements including durable goods orders, new home sales, personal consumption, non-farm payroll, trade balance and Treasury budget to have a significant influence on mortgage spreads.     

An empirical analysis of the interrelationships among equity markets under changing exchange rate systems

The purpose of this article is to investigate the interrelationships between seven stock markets (Germany, France, Italy, the Netherlands, Belgium, the United Kingdom and U.S.A.) over the period 1969–1976. The impact of flexible exchange rates on the various correlation coefficients is shown to be rather low. The results show a trend towards higher segmentation between the various stock exchanges, which means larger opportunities for international diversification. Finally the relationships between stock index variations and exchange rate fluctuations are analyzed.     

Segmentation in direct marketing channels: a transaction-patterns based method

This paper presents a method designed to segment a customer file for direct marketing using behavioral data. The results of this method are tested against the traditional Recency-Frequency-Monetary Amount segmentation model, as well as other parameters of consumer behavior. Strategic applications and future research orientations are suggested.