Regions and French society: Three scenarios of the future

This paper is a translated version of the résumé, “Territoires et société”, of the report presented to the Budapest UN ECE seminar on long-term perspectives for human settlements development.     

China's search for the future: A genealogical approach

This paper is a dialectical inquiry, presenting a genealogy of, China futures discourses and visions from ancient times through to the, present. It uses both structural and macrohistorical based approaches. The identified worldviews are placed in their broader historical, epistemes; asked why change has occurred, how it fits within patterns of, history and what kind of futures are offered. It is unique in that I use, the futures triangle methodology to discuss the “pulls” of the future in, each historical era with the corresponding “pushes” of the present and, “weights” of the past. The article concludes with a theory of futures in, Chinese history and looks at which philosophies are likely to play a role, in the possible futures of China. The aim is to highlight which visions, and images have been victorious is affecting the present and influencing, the future.     

Using signposts in future studies: Lessons from the Justice for tomorrow project

Within the field of future studies, the scenario method is frequently applied. In the literature it is often stressed that it is important to know as soon as possible which of several scenarios is closest to the course of history as it actually unfolds. However, tracking scenarios via early warning mechanisms or signposts, is not a common practice. A standard methodology seems to be absent. Within the context of the Justice for tomorrow project, a scenario project of the Dutch ministry of Justice, we developed and applied a signpost method. We used this method to answer the question of how actual developments relate to the development paths depicted in the scenarios. In this paper we evaluate our approach. We explain what lessons can be learned regarding the use of signposts in future studies.     

Sovereign risk spillovers: A network approach

Understanding the global financial network for sovereign debt, particularly with a focus on interaction and spillover effects of sovereign risk, has become important for policy makers as they look to protect the stability of their economies. Using high dimensional Vector Autoregression techniques and network simulation on Sovereign Credit Default Swaps (CDS)’ data of 57 countries, we identify that the global sovereign CDS network is fully integrated as there is virtually no country without any connection to at least one specific node in the system. However, each country has a unique attribute in the network, as a risk exporter or importer and/or risk transmitter. Among developed countries, the US (unsurprisingly) holds the dominant position as a risk exporter while Germany is identified as a connecting country that transmits shocks. The most connected countries in the sovereign CDS network belong to the new European Union members. We examine possible drivers of the network relationships observed, in order to better understand the risk transmission process, and find that connections in the sovereign risk network are stronger within regional groups and countries with the same level of economic development. Central and Eastern Europe and Middle East and Africa have more interactive networks than Northern Western Europe, Asia Pacific and Latin America. We also identify that financial volatility and economic policy uncertainty increase the interactions in market-based default risk assessment.     

A neural network approach to the prediction of going concern status

The assessment of a firm's going concern status is not an easy task. To assist auditors, going concern prediction models based on statistical methods such as multiple discriminant analysis and logit/probit analysis have been explored with some success. This study attempts to look at a different and more recent approach—neural networks. In particular, a neural network model of the feedforward, backpropagation type was constructed to predict a firm's going concern status from six financial ratios, using a data set containing 165 non-going concerns and 165 matched going concerns. On an evenly distributed hold-out sample, the trained network model correctly predicted all 30 test cases. The results suggest that neural networks can be a promising avenue of research and application in the going concern area.     

A third sector approach to Sweden's future

The two development models summarized in this study are: Model “K” — export-led growth, aimed at goods-oriented production, public service expansion, real wage increases, high rate of employment, and industry: high technology for worldmarkets; and Model “A” — mobilization of work, by means of promotion of the informal economy, policies for unorthodox municipal problem-solving, service growth (by mixed formal or informal organization), and, for industry, less emphasis on expansion and exports, more on domestic consumer needs.     

Managing wealth: A new approach

This paper investigates how well ‘mid-worth’ individuals are served by the financial services industry in the UK. It defines and analyses the new phenomenon of ‘mid-worth’ individuals: the rapid growth in the number of people with significant liquid assets available for investment. It then considers how well these individuals are served by the most common investment products and concludes that most individuals are so poorly served that the result is seriously damaging to their long-term financial health. The paper investigates the main reasons for this: a lack of understanding of the relationship between risk and return, and what can only be described as a conspiracy of ‘mystification’, resulting in customers standing even less chance of understanding the risk-return relationship. The consequence of this is that investors end up paying far too much for ‘heavily packaged’ investment products with the result that they may find they have much less money available to them when they need it most—in old age. The research for this paper was sponsored by Close Wealth Management.     

Past and future of backcasting: The shift to stakeholder participation and a proposal for a methodological framework

This paper deals with the past, present and future of backcasting. After having reviewed the origin and developments since the 1970s, it is concluded that several varieties can be distinguished and that a shift has been made to broad stakeholder participation and towards a focus on realising follow-up and implementation. A methodological framework for participatory backcasting is proposed consisting of five stages and four groups of tools and methods that can be applied and are necessary in such a framework, while different type of goals are possible. The paper reports on two cases in which participatory backcasting was applied, the Novel Protein Foods project at the Sustainable Technology Programme in the Netherlands and the Nutrition case study of the Sustainable Households (SusHouse) project. The paper concludes that these have resulted in broad stakeholder involvement, sustainable future visions, analyses and construction of follow-up agendas, but that follow-up and impacts are quite different. A research agenda is proposed to compare and evaluate backcasting studies and their impacts after a couple of years, while the future of participatory backcasting is also briefly discussed.     

A new approach to forecasting exchange rates

Building on purchasing power parity theory, this paper proposes a new approach to forecasting exchange rates using the Big Mac data from The Economist magazine. Our approach is attractive in three aspects. Firstly, it uses easily-available Big Mac prices as input. These prices avoid several potential problems associated with broad price indexes, such as the consumer price index used in conventional PPP studies. Secondly, this approach provides real-time exchange-rate forecasts at any forecast horizon. These high-frequency forecasts could be appealing to those who want up-to-date exchange-rate forecasts. Finally, as our forecasts are obtained through a simulation procedure, estimation uncertainty is made explicit in our framework that provides the entire distribution of exchange rates, not just a single point estimate. Using exchange rates of six major currencies to illustrate the approach, we compare the Big Mac forecasts with those derived from a random walk and the CPI and find some support for our approach, especially at longer term horizons.     

The open approach to flood control: the way to the future in Bangladesh

This paper offers a critique of the cordon approach to flood control that Bangladesh has been pursuing for several decades now. It shows how this approach fails to solve the flood problem, deprives the floodplains from benefits of regular river-inundation, creates a risky situation for the inhabitants inside cordons, brings in new problems of drainage and sanitation, and leads to huge waste of resources. The paper then argues for the open approach to flood control as the way to the future. The main components of this approach are: re-excavation of river beds and other surface water bodies, minimization of obstruction on floodplains, increasing the elevation of rural and urban dwellings, restoration of waterways, and promotion of rural settlement consolidation around permanent flood shelters. The paper shows in what ways the open approach to flood control is superior to the cordon approach.     

A neural network approach to understanding implied volatility movements

The expected response of an index volatility surface to index movements is quite different in high and low volatility environments     

Total environmental management An approach to the dilemmas of the affluent society

Many people are currently advocating a ‘no growth’ economy. By way of introduction, the author explains why and how this is so, and then points out that the objectives of conservation and economic growth can and should be seen as complementary. He advocates the application of the systems approach to the total fabric of our natural and social environments.     

Tomorrow and tomorrow and tomorrow : Aspects of the history and social development of European Australia

The forces which shaped modern Australia are still powerfully present. Some of these forces can be traced through the themes of an Australian novel Tomorrow and Tomorrow and Tomorrow which was first published in 1947. Using this novel as a springboard, this article considers a number of key aspects of Australian society and culture. It concludes that some major changes are needed if the country is to maintain its existing way of life.     

Inferring future volatility from the information in implied volatility in Eurodollar options: a new approach

We study the information content of implied volatility fromseveral volatility specifications of the Heath-Jarrow-Morton(1992) (HJM) models relative to popular historical volatilitymodels in the Eurodollar options market. The implied volatilityfrom the HJM models explains much of the variation of realizedinterest rate volatility over both daily and monthly horizons.The implied volatility dominates the GARCH terms, the Glostenet al. (1993) type asymmetric volatility terms, and the interestrate level. However, it cannot explain that the impact of interestrate shocks on the volatility is lower when interest rates arelow than when they are high.