Age-test Markov chains for drug testing and detection

Random urinalysis strategies stratified by time since the last test are characterized with a set of Markov chain models. The probability of a person being tested depends on the amount of time since the person's last test. The Nuclear Regulatory Commission (NRC) has proposed a two strata drug testing strategy based on time since last test. The proposal included a high testing rate for people not yet tested in a given time period and a low testing rate for people testing negative in a given time period. Southern California Edison has implemented a variation of the NRC proposal. These strategies can be modeled within a Markov chain framework. Time to detection is calculated as a function of testing probabilities and drug usage levels. Drug user gaming strategies are discussed with illustrations. These models are implemented as part of a U.S. Navy drug policy analysis system.     

The effect of a currency union on trade: Lessons from the Irish experience

This paper studies the introduction of an exchange rate between Ireland and the UK in 1979 to shed light on the effects of a common currency on the composition of international trade. No evidence is found from time series or panel regressions that the change of exchange rate regime had a significant effect on Anglo-Irish trade. This finding is consistent with previous studies of currency unions between larger, developed countries but conflicts with findings based on more heterogeneous country groupings. The reasons for this discrepancy are discussed.     

The Effect of Respondent Experience/Knowledge in the Elicitation of Contingent Values: An Investigation of Convergent Validity,Procedural Invariance and Reliability

Tests of convergent validity and procedural invariance were used to investigate whether individuals lacking direct experience with a commodity can provide valid responses to contingent-valuation questions eliciting ex post use values. Convergent validity between samples with and without experience was shown to hold for dichotomous-choice responses, but not for open-ended responses.     

Short Positions in the First Principal Component Portfolio

Insurance companies and pension plans typically hold well-diversified equity portfolios. These institutions are also often restricted from taking short positions. The diversification requirement operates on the portfolio level, while the short sale constraint is at the individual security level. We examine an investment strategy that exposes a tension between these two requirements. This strategy uses the first principal component to construct the portfolio and by design meets the first requirement. Empirical portfolios based on the first principal component do an excellent job of capturing market exposure and minimizing diversifiable risk. However, in practice such portfolios sometimes contain a few short positions. So this strategy does not always meet the second requirement. We examine which features of stock returns give rise to short positions when a portfolio is based on the first principal component, and we are able to identify the characteristics of the stocks that are responsible for the short positions. These stocks tend to have negative correlations with the majority of other stocks. In contrast such stocks would typically be held long in a Markowitz portfolio. We discuss and explain this puzzle.     

Narcissism normalisation: tourism influences and sustainability implications

The concept of narcissism normalisation suggests that individuals and societies are becoming more narcissistic due to various cultural influences. Tourism is reviewed here as one such possible influence. Exploitative, entitled and exhibitionistic tendencies associated with narcissism are well-established in tourism. Yet tourism is also an intimate, communal and satisfying activity which may counteract narcissism. Increases in narcissism have significant implications from a sustainable tourism perspective. Narcissism is associated with exploitative and entitled behaviours that over time cause significant harm to those people and landscapes that come into contact with. Narcissism appears to be incompatible with principles of sustainability and the challenges this poses for the industry are reviewed, while the opportunities are also explored. There are signs that narcissism, particularly those aspects relating to exhibitionism, can be co-opted to benefit sustainable development.     

DO STOCK MARKET FLUCTUATIONS AFFECT SUICIDE RATES?

In this study, we extend the standard economic model of suicide by considering a new influential factor driving the voluntary death rate. Using an international sample, we estimate the model and document a robust and significant inverse relation between stock market returns and the percentage increase in suicide rates. Trends in male and female suicide are affected by market fluctuations, both contemporaneously and at a lag. This predictive quality of stock returns offers the potential to implement pro-active suicide prevention strategies for those who could be affected by the vagaries of the market and general economic downturns.     

The New Microeconomics: A Psychological,Institutional, and Evolutionary Paradigm with Neoclassical Economics as a Special Case

Microeconomics requires a new grounding or formulation that can account for a broader range of socioeconomic behavior than neoclassical economics does. The core of the neoclassical economics research program—the theory of rational choice—has offered insights into the determination of socioeconomic behavior. But other elements need to be integrated into a coherent microeconomic perspective. We introduce such a perspective in which neoclassical economics becomes a special case. This advances our understanding of the determinants of behavior in a coherent and integrated manner. This perspective may form the foundation of an evolutionary and institutional perspective on socioeconomic systems. This has practical value in designing strategy and policy.