How does improved forecasting benefit detection? An application to biosurveillance

While many methods have been proposed for detecting disease outbreaks from pre-diagnostic data, their performance is usually not well understood. We argue that most existing temporal detection methods for biosurveillance can be characterized as a forecasting component coupled with a monitoring/detection component.In this paper, we describe the effect of forecast accuracy on detection performance. Quantifying this effect allows one to measure the benefits of improved forecasting and determine when it is worth improving a forecast method’s precision at the cost of robustness or simplicity. We quantify the effect of forecast accuracy on detection metrics under different scenarios and investigate the effect when standard assumptions are violated. We illustrate our results by examining performance on authentic biosurveillance data.     

To lead or to wait? An application to internationalization strategies under demand uncertainty

We examine the exports versus foreign direct investment (FDI) decision under demand uncertainty for an asymmetric cost duopoly. One of the firms can lead entry before demand realization or retain flexibility enjoying an informational advantage. When the time value of information is small and for sufficiently low investment costs, follow‐the‐leader behavior in FDI arises. Relatively high investment (fixed) costs result in follow‐the‐leader exporting behavior. When the time value of information becomes significant, the potential leader will opt for a wait‐and‐see strategy. For intermediate values of investment costs, the efficient firm invests, while the rival chooses to export.     

An application of an integrated ANP–QFD framework for sustainable supplier selection

This study provides a novel integrated multi-criteria decision-making approach to sustainable supplier selection problems. Despite the large supply chain management literature on green performance measurement, the need for a systematic analysis of how specific sustainable variables develop and affect each other remains mostly overlooked. The proposed integrated framework allows for such an analysis. By combining analytic network process and quality function deployment, our model identifies a clear hierarchical structure for all the relevant sustainable factors and sub-factors while weighting the decision criteria based on the importance given to customer requirements. Finally, suppliers are ranked using a multi-objective optimisation procedure based on ratio analysis and weighted aggregated sum product assessment. The proposed framework is used to analyse a case study of a dairy company, but it can be easily implemented for supplier selection by any other company with similar features.     

An axiomatic design framework to design interoperable buyer–supplier dyads

ABSTRACT

Cooperation arrangements in the form of buyer–supplier dyads are a way that companies have found to deal with the current competitive environment. Despite the contributions in the interoperability literature, a cohesive framework is lacking that would allow the systematization of solutions for interoperable problems in such cooperation. Therefore, we propose a framework for systematically detail interoperability issues and to provide solutions that fit business conditions.Through a case study conducted on an automotive dyad, it is possible to achieve a better interoperable scenario, by systematically addressing the issues and providing solutions that comply with the AD independence axiom.     

Bayesian estimation of labor demand by age: theoretical consistency and an application to an input–output model

Extended input–output models require careful estimation of disaggregated consumption by households and comparable sources of labor income by sector. The latter components most often have to be estimated. The primary focus of this paper is to produce labor demand disaggregated by workers’ age. The results are evaluated through considerations of its consistency with a static labor demand model restricted with theoretical requirements. A Bayesian approach is used for more straightforward imposition of regularity conditions. The Bayesian model confirms elastic labor demand for youth workers, which is consistent with what past studies find. Additionally, to explore the effects of changes in age structure on a regional economy, the estimated age-group-specific labor demand model is integrated into a regional input–output model. The integrated model suggests that ceteris paribus ageing population contributes to lowering aggregate economic multipliers due to the rapidly growing number of elderly workers who earn less than younger workers.     

Driver behaviour and business outcomes: An alternative approach to the psychology of the owner–manager

Previous psychological approaches to the study of owner–managers are reviewed and an alternative model based on the transactional analysis concept of Drivers is put forward. This model is tested out via a series of interviews and observations of 20 owner–managers of small and medium–sized businesses based in the North East of England. The relationship between driver behaviour and business performance is explored and the negative consequences of driver behaviour for the business are identified. Driver behaviour is also viewed as potentially beneficial and the inherent positive aspects of driver behaviour are proposed as the opposite end of a continuum of behaviours which are at the heart of business success. On a methodological level the need for an approach grounded in the owner–managers behaviour is confirmed.     

An application of Stein’s method to limit theorems for pairwise negative quadrant dependent random variables

Stein’s method is used to derive an error in normal approximation for sums of pairwise negative quadrant dependent random variables, but under the assumption of second moment only. This allows us to derive a central limit theorem for pairwise negative quadrant dependent random variables with Lindeberg’s condition. Research supported by Science Foundation of Zhejiang Provincial Education(no. 20060122)     

Replica core equivalence theorem: An extension of the Debreu–Scarf limit theorem to double infinity monetary economies

An overlapping generations model with the double infinity of commodities and agents is the most fundamental framework to introduce outside money into a static economic model. In this model, competitive equilibria may not necessarily be Pareto-optimal. Although Samuelson (1958) emphasized the role of fiat money as a certain kind of social contract, we cannot characterize it as a cooperative game-theoretic solution like the core. In this paper, we obtained a finite replica core characterization of Walrasian equilibrium allocations under non-negative wealth transfer and a core-limit characterization of Samuelson’s social contrivance of money. Preferences are not necessarily assumed to be ordered.     

Mapping potentials for input–output-based innovation flows in industrial clusters – an application to Germany

Our paper pursues two aims: first, it presents an approach based on input–output innovation flow matrices to study intersectoral innovation flows within industrial clusters. Second, we apply this approach to the identification of structural weaknesses in East Germany relative to the western part of the country. The case of East Germany forms an interesting subject because while its convergence process after unification began promisingly in the first half of the 1990s, convergence has since slowed down. The existing gap can now be traced mainly to structural weaknesses in the East German economy, such as the absence of strong industrial cluster structures. With this in mind, we investigate whether East Germany does in fact reveal the abovementioned structural weaknesses. Does East Germany possess fewer industrial clusters? Are they less connected? Does East Germany lack specific clusters that are also important for the non-clustered part of the economy?     

“Speculative Influence Network” during financial bubbles: application to Chinese stock markets

We introduce the Speculative Influence Network (SIN) to decipher the causal relationships between sectors (and/or firms) during financial bubbles. The SIN is constructed in two steps. First, we develop a Hidden Markov Model (HMM) of regime-switching between a normal market phase represented by a geometric Brownian motion and a bubble regime represented by the stochastic super-exponential Sornette and Andersen (Int J Mod Phys C 13(2):171–188, 2002) bubble model. The calibration of the HMM provides the probability at each time for a given security to be in the bubble regime. Conditional on two assets being qualified in the bubble regime, we then use the transfer entropy to quantify the influence of the returns of one asset i onto another asset j, from which we introduce the adjacency matrix of the SIN among securities. We apply our technology to the Chinese stock market during the period 2005–2008, during which a normal phase was followed by a spectacular bubble ending in a massive correction. We introduce the Net Speculative Influence Intensity variable as the difference between the transfer entropies from i to j and from j to i, which is used in a series of rank ordered regressions to predict the maximum loss (%MaxLoss) endured during the crash. The sectors that influenced other sectors the most are found to have the largest losses. There is some predictability obtained by using the transfer entropy involving industrial sectors to explain the %MaxLoss of financial institutions but not vice versa. We also show that the bubble state variable calibrated on the Chinese market data corresponds well to the regimes when the market exhibits a strong price acceleration followed by clear change of price regimes. Our results suggest that SIN may contribute significant skill to the development of general linkage-based systemic risks measures and early warning metrics.     

Database segmentation: An alternative to recency,frequency, value?

This paper argues that recency, frequency, value (RFV), the engines of database segmentation in the voluntary sector, are by no means the only profitable approaches to database segmentation. The use of response models based on core statistical theorems offers an alternative to RFV that may be more discriminatory in targeting both those who are most likely to respond (the people we want to communicate with), and also those least likely to respond (the people we want to avoid).     

Do we estimate an input or an output distance function? An application of the mixture approach to European railways

In this paper, we estimate parametric input and output distance functions and discuss how to estimate a mixture/latent class model (LCM) involving the output and input distance functions in the context of multi-input and multi-output production technology. The proposed technique is applied to a panel data on European Railways (1971–1994). This model allows us to identify determinants of the efficiency orientation, thereby providing useful information that can help researchers to choose between the input and the output-oriented approaches. In addition, we develop cross-indices that can be used to compute input (output) technical inefficiency from the estimates of output (input) distance function.

Count data stochastic frontier models, with an application to the patents–R&D relationship

This article introduces a new count data stochastic frontier model that researchers can use in order to study efficiency in production when the output variable is a count (so that its conditional distribution is discrete). We discuss parametric and nonparametric estimation of the model, and a Monte Carlo study is presented in order to evaluate the merits and applicability of the new model in small samples. Finally, we use the methods discussed in this article to estimate a production function for the number of patents awarded to a firm given expenditure on R&D.     

An extension of the Sard–Smale Theorem to convex domains with an empty interior

A stumbling block in the modeling of competitive markets with commodity and price spaces of infinite dimensions, arises from having positive cones with an empty interior. This issue precludes the use of tools of differential analysis, ranging from the definition of a derivative, to the use of more sophisticated results needed to understand determinacy of equilibria and, more generally, the structure of the equilibrium set. To overcome these issues, this note extends the Preimage Theorem and the Sard–Smale Theorem to maps between convex sets that may have an empty interior.     

An estimation of US industry-level capital–labor substitution elasticities: support for Cobb–Douglas

A key parameter that determines the distributional impacts of a policy shift in general equilibrium models is the elasticity of substitution between capital and labor. Despite the importance of this parameter in applied modeling, its identification continues to pose a challenge. Given the structure of most growth models, we posit that the true relationship between capital and labor is likely to be close to Cobb–Douglas. Using a rich new data set from the Bureau of Economic Analysis (BEA), we estimate substitution elasticities for 28 industries that cover the entire economy, and provide an indication of the long- and short-run ranges of those estimates. We fail to reject the Cobb–Douglas specification in 20 of the 28 industries. These findings lend support to the Cobb–Douglas specification as a transparent starting point in simulation analysis.     

Estimating farmers’ productive and marketing inefficiency: an application to vegetable producers in Benin

This paper estimates the technical and marketing inefficiency of a sample of urban vegetable producers in Benin. Marketing inefficiency is defined as the failure of farmers to achieve better marketing output and is reflected in lower output price indices. The study proposes a Russell-type measure of inefficiency using a directional distance function that accounts simultaneously for the expansion of outputs and price indices and the contraction of variable inputs. A truncated bootstrap regression is used in the second stage to consistently analyze factors that underlie differences in inefficiency. The first-stage results suggest that vegetable producers are more inefficient with respect to marketing than production. The second-stage results indicate that technical inefficiency is affected by the production environment and private extension services. Marketing inefficiency is affected by the type of marketing arrangements.     

Prospect theory and risk appetite: an application to traders’ strategies in the financial market

According to behavioral finance theories, in this article we develop a dynamic model with heterogeneous traders, where the asset price is determined by the interaction among four different groups of agents: trend reversers, trend followers, risk averters and risk seekers. The main purpose of the study is centered on modeling and testing how the market efficiency changes along with the changes of agent’s behavior preference without exogenous influence. Combining with the assumption of risk appetite and prospect theory, focusing on analyzing the rules for selecting strategies, we establish a more reliable and comprehensive dynamic mechanism. In particular, our study suggests that diversified trading strategies will help to realize market efficiency.     

Correction to: Foreword special issue Deaf 2019–Maf 2018

Decisions in Economics and Finance -     

Knowledge sharing,work–family conflict and supervisor support: investigating a three-way effect

Despite the importance of knowledge sharing in competitive environments, there is a paucity of studies examining the relationship between employee knowledge sharing and work–family conflict. Drawing on insights from conservation of resources theory, this study investigated how employees may reduce their knowledge-sharing behaviors when they experience resources lost from work interference with family (WIF) or family interference with work (FIW). Furthermore, the role of supervisor support in the relationship among WIF, FIW and knowledge sharing was explored as a valuable resource. Using data collected from 159 employees in South Korea, we found support that WIF is negatively related to knowledge sharing. In addition, the role of supervisor support in the relationship among WIF, FIW and knowledge sharing was the strongest when WIF is low and FIW is high, thus supporting the hypothesized a three-way effect. Theoretical and practical implications are discussed.