The temporal variation of cost-efficiency in Switzerland’s hospitals: an application of mixed models

This paper uses a mixed effects model to examine the temporal variation of cost efficiency in Switzerland’s general hospitals. The variations in total costs, the number of empty beds and the length of hospital stays are analyzed using financial data from a sample of 168 hospitals operating from 1998 to 2003, as well as hospitalization records disaggregated to Diagnosis Related Groups. Individual intercepts and random coefficients are used to account for the unobserved time-invariant heterogeneity and the differences in temporal patterns across hospitals and DRG categories. The analysis illustrates the usefulness of mixed models to account for unobserved factors such as quality, with a relatively weak assumption that their temporal variations, rather than their initial levels, be uncorrelated with efficiency changes. The results indicate that hospitals have adopted measures to curtail hospitalizations and reduce empty beds. The extent and effectiveness of these measures vary significantly across individual hospitals. However, there is no evidence in favor of a particular ownership type or subsidization regime. While the link between reduction rates of empty beds and gains in cost-efficiency is statistically significant, the expected association between shortening hospital stays and cost-efficiency cannot be clearly established in the data.

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.     

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.     

Aspects of complexity in citizen–bureaucrat corruption: an agent-based simulation model

In this paper, the complexity-based approach is used to analyse corruption and its internal economics and dynamics. To better understand the drivers of corruption, we employ an agent-based model with heterogeneous agents (bureaucrats and citizens), the interactions of which determine the level of corruption in a society. The emergence of a prevailing social norm of corruption is shown to be significantly influenced by the initial conditions (i.e., history and habits). A cost analysis demonstrates that a relatively limited financial investment is required for the phase transition from the corrupt to the non-corrupt state. The concept of opportunity costs is used to express the value of information shared within an agent’s social group that improves agent decision-making. Incomplete information and uncertainty in the legal system help to reduce corruption by promoting a fear of engaging in corruption in a society. The results of this research may offer useful insights for informing an effective anti-corruption policy.

     

Suppes–Sen maximality of cyclical consumption: The neoclassical growth model

In this paper we demonstrate the existence of cyclical consumption that are maximal according to the Suppes–Sen grading principle for the Aggregative Growth Model. The paper demonstrates the optimality of cyclical consumption paths in the absence of discounting for the smooth neoclassical growth model. The process of this verification allows us to develop the theory of weakly maximal paths for a non-concave and discontinuous utility function extending previous results from Optimal Growth Theory.     

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.     

Measuring the effect of Kyoto protocol agreement on countries’ environmental efficiency in CO2 emissions: an application of conditional full frontiers

This paper applies the probabilistic approach developed by Daraio and Simar (J Prod Anal 24:93–121, 2005, Advanced robust and nonparametric methods in efficiency analysis. Springer Science, New York, 2007a, J Prod Anal 28:13–32, 2007b) in order to develop conditional and unconditional data envelopment analysis (DEA) models for the measurement of countries’ environmental efficiency levels for a sample of 110 countries in 2007. In order to capture the effect of countries compliance with the Kyoto protocol agreement (KPA) policies, we condition first the years since a country has signed the KPA until 2007 and secondly the obliged percentage level of countries’ emission reductions. Particularly, various DEA models have been applied alongside with bootstrap techniques in order to determine the effect of KPA on countries’ environmental efficiencies. The study illustrates how the recent developments in efficiency analysis and statistical inference can be applied when evaluating environmental performance issues. The results indicate a nonlinear relationship between countries’ obliged percentage levels of emission reductions and their environmental efficiency levels. Finally, a similar nonlinear relationship is also recorded between the duration which a country has signed the KPA and its environmental efficiency levels.     

Incentive regulation and performance measurement of Taiwan’s incineration plants: an application of the four-stage DEA method

The aim of this paper is to provide a technical efficiency assessment of Taiwan’s incineration plants as the basis of incentive regulation schemes. We integrate the four-stage approach with Simar and Wilson’s (in J Econom 136:31–64, 2007) double bootstrapping to filter out the impacts of external variables in the efficiency measurement. Empirical results show that there is room for 15 % cost reductions and capacity, ownership, location and experience are all influential in improving the performance of these plants. We also demonstrate how the results can be applied to modify a yardstick incentive scheme.     

Supervisors as good coaches: influences of coaching on employees’ in-role behaviors and proactive career behaviors

Coaching as an effective leadership initiative in organizations has gained increasing attention from scholars. This study investigates the effects of coaching on employees’ in-role behaviors (IRBs) and proactive career behaviors (PCBs), while also exploring the mediating role of psychological empowerment. Data were collected from a sample of 324 employee–supervisor pairs from 11 service companies in Taiwan. The results show that coaching was positively related to both IRBs and PCBs. Moreover, psychological empowerment fully mediated the coaching–IRB relationship and partially mediated the coaching–PCB relationship. Implications for managerial practices and future research are derived from these findings.     

The consumption–investment decision of a prospect theory household: A two-period model

This study extends the literature on portfolio choice under prospect theory preferences by introducing a two-period life cycle model, where the sufficiently loss averse household decides on optimal consumption and investment in a portfolio with one risk-free and one risky asset. The optimal solution depends primarily on whether the household’s present value of the consumption reference levels is below, equal to, or above the present value of its endowment income. Reference levels below the endowment income are associated with the self-enhancement motive. In this case, the household avoids relative losses in consumption in any present or future state of nature (good or bad). As a result the degree of loss aversion does not directly affect optimal consumption and risk taking activity. Reference levels equal to the endowment income are associated with the belonging motive. An example would be a household comparing to others that belong to the same social class. In this case the household’s optimal consumption is the reference consumption and the household will not invest in the risky asset. Finally, reference levels above the endowment income are associated with the self-improvement motive (or high aspirations). For such high reference levels, households cannot avoid experiencing a relative loss in consumption, either now or in the future. As a result, loss aversion directly affects consumption and risky investment.     

Diversification strategy,CEO management style and firm performance: an application of Heckman’s two-stage method

This paper aims to explore whether CEOs’ management style as agents or as stewards, which depends on their psychological and situational characteristics, moderates the effect of the diversification strategy on firm performance. After applying Heckman’s two-stage method to control econometrically for endogeneity bias in empirical work, results demonstrate that the relationship between diversification and profitability varies significantly depending on the management style of the diversifying CEO.     

Robust stochastic frontier analysis: a Student’s t-half normal model with application to highway maintenance costs in England

The presence of outliers in the data has implications for stochastic frontier analysis, and indeed any performance analysis methodology, because they may lead to imprecise parameter estimates and, crucially, lead to an exaggerated spread of efficiency predictions. In this paper we replace the normal distribution for the noise term in the standard stochastic frontier model with a Student’s t distribution, which generalises the normal distribution by adding a shape parameter governing the degree of kurtosis. This has the advantages of introducing flexibility in the heaviness of the tails, which can be determined by the data, as well as containing the normal distribution as a limiting case, and we outline how to test against the standard model. Monte Carlo simulation results for the maximum simulated likelihood estimator confirm that the model recovers appropriate frontier and distributional parameter estimates under various values of the true shape parameter. The simulation results also indicate the influence of a phenomenon we term ‘wrong kurtosis’ in the case of small samples, which is analogous to the issue of ‘wrong skewness’ previously identified in the literature. We apply a Student’s t-half normal cost frontier to data for highways authorities in England, and this formulation is found to be preferred by statistical testing to the comparator normal-half normal cost frontier model. The model yields a significantly narrower range of efficiency predictions, which are non-monotonic at the tails of the residual distribution.

     

Validating a theoretical model of citizens’ trust in tourism development

This research establishes the theoretical link between the development of tourism and citizens' trust. The research is grounded in political economy of state intervention in tourism and draws from social exchange theory to build the theoretical model. The latter incorporates variables such as trust, power, knowledge, and benefits and costs of tourism, which are central to any exchange process between social actors. The model distinguishes and proposes a theoretical relationship between domain specific political trust and generic political trust. The former refers to citizens' trust in local government in the specific context of tourism development while the latter refers to citizens' general level of trust in local government. The model is tested using data collected from residents of the metropolitan area of Naples, Italy. Results suggest that residents’ trust in local government in the specific context of tourism strongly influences their general level of trust, suggesting a spill-over effect of political trust. We demonstrated empirically that political trust in the context of tourism and the general trust in an institution are theoretically distinct concepts. The constructs we used to conceptualize tourism development has distinct influence on the two dimensions of political trust.     

Accounting for value added embodied in trade and consumption: an intercomparison of global multiregional input–output databases

Global multiregional input–output (MRIO) tables constitute detailed accounts of the economic activity worldwide. Global trade models based on MRIO tables are being used to calculate important economic and environmental indicators such as value added in trade or the carbon footprint of nations. Such applications are highly relevant in international trade and climate policy negotiations, and consequently MRIO model results are being scrutinized for their accuracy and reproducibility. We investigate the variation in results from three major MRIO databases by comparing underlying economic data and territorial and consumption-based results across databases. Although global value-added accounts were similar across databases, we find some significant differences at the level of individual countries and sectors. Model disagreement was relatively stable from the territorial to the consumption perspective. Pairwise matrix comparison statistics indicated that the Global Trade Analysis Project and World Input-Output Database MRIO tables were overall more similar to each other than either was to the Eora database.     

Effects of international trade on domestic employment: an application of a global multiregional input–output supermultiplier model (1995–2011)

The effects on domestic employment of international trade and the globalisation of supply chains are as politically controversial as they are empirically inconclusive. To estimate them we extend the global multiregional input–output framework by endogenising demand for both domestic and imported intermediates, private business investment and household non-durable consumption – or equivalently, we generalise the supermultiplier formula. The model accounts, in particular, for the employment consequences of economic integration and those channelled through integration. We estimate these foreign sector effects alongside those of domestic origin using a recursive hierarchical structural decomposition analysis and statistics from the World Input–Output Database and National Accounts that cover years 1995–2011. Focusing on Spain, Italy, France, Germany, the UK, the US, Japan and China we answer the following questions: To what extent did international linkages deriving from international trade affect domestic employment? Did domestic employment benefit from economic integration?     

Too dynamic to fail: empirical support for an autocatalytic model of Minsky’s financial instability hypothesis

Solomon and Golo (Account Econ Law 3(3):167–260, 2013) have recently proposed an autocatalytic (self-reinforcing) feedback model which couples a macroscopic system parameter (the interest rate), a microscopic parameter that measures the distribution of the states of the individual agents (the number of firms in financial difficulty) and a peer-to-peer network effect (contagion across supply chain financing). In this model, each financial agent is characterized by its resilience to the interest rate. Above a certain rate the interest due on the firm’s financial costs exceeds its earnings and the firm becomes susceptible to failure (ponzi). For the interest rate levels under a certain threshold level, the firm loans are smaller then its earnings and the firm becomes ‘hedge.’ In this paper, we fit the historical data (2002–2009) on interest rate data into our model, in order to predict the number of the ponzi firms. We compare the prediction with the data taken from a large panel of Italian firms over a period of 9 years. We then use trade credit linkages to discuss the connection between the ponzi density and the network percolation. We find that the ‘top-down’–‘bottom-up’ positive feedback loop accounts for most of the Minsky crisis accelerator dynamics. The peer-to-peer ponzi companies contagion becomes significant only in the last stage of the crisis when the ponzi density is above a critical value. Moreover the ponzi contagion is limited only to the companies that were not dynamic enough to substitute their distressed clients with new ones. In this respect the data support a view in which the success of the economy depends on substituting the static ‘supply-network’ picture with an interacting dynamic agents one.     

Performance impacts of management in Korean schools: Testing the Meier and O’Toole model

This article investigates the impact of management on performance in Korean schools. Drawing upon the model of Meier and O’Toole, we test the linear relationships of internal management, managerial networking, and managerial quality with multiple dimensions of performance. We also examine the nonlinear relationships between networking and performance. The results show a general consistency in the positive link between management and performance, providing evidence to support the key arguments from the model. Still, there are noticeable differences in specific findings. As one of the first applications of the Meier and O'Toole model in Asia, this study illustrates the importance of the national context in management–performance linkage.     

Measurement of an individual entrepreneur��s social capital: a multidimensional model

The aim of this paper is twofold. First of all, we participate in the open discussion on the nature of social capital and we show that the one-dimensional approach is not enough to capture the complex nature of social capital. Second, we present, implement and validate a specific three-dimensional measurement tool that can be used to analyze the role of social capital in further entrepreneurship research. The measurement tool is implemented through a Structural Equation Model, which is estimated and validated from a database including information from 282 Argentinean entrepreneurs who answered a questionnaire specifically designed for this research. Our measurement model considers the dimensions proposed by Koka and Prescott (Strategic Management Journal, 23:795–816, 2002), i.e. relational, resources and structural.     

Women’s entrepreneurship: A model of business-family interface and performance

Recently, there are renewed calls to develop new models addressing the intricacies of women-owned businesses and the women that head them. A new conceptual model of women’s entrepreneurship that involves relationships between business-family-interface and firm performance is introduced in our paper. We test the model based on data from countries around the world and show that the model’s links depend on the country context. As a result, we identify new boundary conditions to the domain of female entrepreneurship. Implications are discussed.     

Revisiting the forward—spot relation: an application of the nonparametric long-run correlation coefficient

This study revisits the statistical relationship between the spot and the forward rate. Unlike previous studies, this association is measured by the estimation of the long-run correlation coefficient, a non-parametric measure of linear association. This estimator was shown to be equivalent to the Bartlett kernel spectral estimator of the complex coherency at frequency zero. This statistic allows for the measurement of the intensity of correlation. Using data for the ￡/DM over the May 1992 British General Election and September 1992 ERM devaluation, and for the FF/DM, BEF/DM, AT/DM, and NLG/DM up to the introduction of Euro, the results show that the predictive ability of the forward rate increased.