A market-consistent framework for the fair evaluation of insurance contracts under Solvency II

Decisions in Economics and Finance - The entry into force of the Solvency II regulatory regime is pushing insurance companies in engaging into market consistence evaluation of their balance sheet,...     

Foreign inflows and economic growth: An emiprical study of the SAARC region

The study examines and highlights the impact of selected foreign inflows (aid, trade, FDI, debt and remittances) on the economic growth of the South Asian Association for Regional Cooperation (SAARC) countries. The existent literature lacks a comprehensive analysis of the SAARC countries as countries like Afghanistan, Bhutan and the Maldives have largely been ignored due to the shorter time periods of available data. The study is empirical in nature and utilizes panel data techniques on macroeconomic data for the period 2008–2015. Foreign aid and foreign direct investment are found to impact economic growth positively. Foreign debt and trade flows are found to adversely affect economic growth. No relationship is established between the flow of remittances and the economic growth of these countries. The obtained results are robust to different proxy variables and the addition of macroeconomic variables. For the first time, the study provides policy implications based on the data of all SAARC countries. The study recommends focusing on increasing the inflows of resources in the form of aid and foreign direct investment (FDI) from the developed world to achieve higher economic growth.     

Magic mirror in my hand … How trade mirror statistics can help us detect illegal financial flows

Misreporting tricks of different sorts applied to the transfer of goods between different countries are typically exploited by criminals worldwide for money laundering ends. The main international anti‐money laundering organisations started paying attention to this phenomenon, dubbed “trade‐based money laundering” (TBML), a long time ago, but the failure to develop appropriate analytical tools has reportedly dogged preventive actions. Nonetheless, literature has widely advocated the possibility that the analysis of inconsistencies in mirrored bilateral trade data could provide some help. By building on previous contributions in the field, this work sets up a model factoring in the main structural determinants of discrepancies between mirrored data concerning Italy's 2010 to 2013 external trade at a highly detailed (6‐digit) level of goods classification for each partner country. Point estimates of freight costs are used to net each observation of the corresponding cif/fob discrepancy. The regression estimates are then deployed in order to compute TBML risk indicators at a country/4‐digit product level. Based on the indicators, rankings of countries and product lines can be compiled, which may be used for a risk‐driven search of potential illegal commercial transactions.     

Spatial Metrics of the Technological Transfer: Analysis and Strategic Management

The Triple Helix thesis states that research laboratories and universities can play an enhanced role in innovation in increasingly knowledge-based societies. In fact the locus of industrial innovation is shifting towards networks focused on technological transfer from public research laboratories to firms. This scenario presents challenges for investigating the new behaviour of research laboratories and the measurement and evaluation of their scientific and technological activity. This study analyses how the variable 'space' affects an important activity carried out within these laboratories: the technological transfer. The purpose of this research is to: (1) construct indicators, called sensors, starting from the geographical neo-classical approach based on physical distance, for measuring and studying the spatial dynamics of technological transfer;(2) apply the metrics to case studies using data from three institutes of the Italian National Council of Research operating in an industrialised region in the north-west Italy. The sensors are useful for understanding the spatial behaviour both of the technological transfer process, and the strategy of research laboratories. Some management implications conclude the research.     

INVENTORY ACCOUNTING AND PROFIT EVALUATION

In an inventory model with exogenous sales, FIFO and LIFO criteria are formalized and compared with national account estimates for intermediate and finished good products. The model is simulated by utilizing manufacturing input and output prices for Italy (1970–88). LIFO and national account estimates of inventory are usually close and also imply reliable measures of output level and changes which can be shown by solving the quantity model. Conversely, FIFO exhibits larger profits and leads in real terms to unsatisfactory estimates of output changes.     

Nuove classi di funzioni scalari concave generalizzate

In questo lavoro si introducono cinque nuove classi di funzioni concave generalizzate; di esse si studiano le proprietà e le interrelazioni con le classi più note in letteratura. Più precisamente, dopo aver evidenziato che le nuove classi sono distinte tra loro e da quelle già note in letteratura, se ne analizzano organicamente le differenze e si studia il loro comportamento dapprima in ipotesi di semicontinuità superiore e poi in ipotesi di continuità. Nel lavoro si dimostra inoltre il mantenimento di alcune proprietà strutturali come pure la conservazione delle principali proprietà relative all'ottimizzazione.

---

Summary In this paper five new classes of generalized-concave functions are introduced and studied. In particular, it is firstly pointed out that the new classes are different from the known ones, then their relationships are stressed both in general and under hypothesis of upper semicontinuity and continuity.Also some properties about optimization and functions transformation are provided.

     

Inflation,interest and exchange rates in the transition1

Central and Eastern European economies have made extraordinary progress in their trade and exchange regimes. Surprisingly, instant convertibility was established for a great variety of exchange rate regimes. In spite of diversity, all these countries have followed a common pattern: severe initial undervaluation - the cost of speed and unrestricted trade - followed by rapid real revaluation and incipient protectionism. Since 1994 in many cases an embarrass de richesse has appeared: high capital inflows which are either inflationary or costly to sterilize. A major cause of these flows - or at any rate of the high cost of sterilization - is the presence of significant interest rate differentials higher than required to cover the risk of devaluation. These are the necessary consequence of a policy of positive real interest rates and of real revaluation from excessively undervalued exchange rates. Lower interest rates are recommended, both to stem financial capital inflows and to reduce the cost of their sterilization.     

Feature selection methods involving support vector machines for prediction of insolvency in non‐life insurance companies

We propose two novel approaches for feature selection and ranking tasks based on simulated annealing (SA) and Walsh analysis, which use a support vector machine as an underlying classifier. These approaches are inspired by one of the key problems in the insurance sector: predicting the insolvency of a non‐life insurance company. This prediction is based on accounting ratios, which measure the health of the companies. The approaches proposed provide a set of ratios (the SA approach) and a ranking of the ratios (the Walsh analysis ranking) that would allow a decision about the financial state of each company studied. The proposed feature selection methods are applied to the prediction the insolvency of several Spanish non‐life insurance companies, yielding state‐of‐the‐art results in the tests performed. Copyright © 2005 John Wiley & Sons, Ltd.     

The Bell Curve in Psychological Research and Practice: Myth or Reality?

The expression “the bell curve” designs both a kind of statistical distribution and the title of a famous and controversial book by Herrnstein and Murray. The first is so attractive that the second refers to it to give more credibility to its questionable theories on intelligence. The point is that, during the 20th century, the bell curve has assumed a more and more important role in psychological research and practice and have become both a reality and a myth. In the first case (reality) we can assist to appropriate applications of a real useful statistical concept. In the second (myth) we can have two kinds of attitudes: one attitude is typical of those researchers who search for normality in all their data and variables, just as Parsifal used to search for the Holy Graal (we call this “the Parsifal attitude”); the other is typical of those researchers who give normality for granted and act as if it were a Platonic Idea (we call this “the Plato attitude”). The article discusses the role of the normal distribution in psychological research and practice and shows how it can be dangerous to treat the bell curve as a God or an Idol.