Remarks on sequential estimation of a linear function of two means: The normal case

Asymptotic normality of the stopping time ofMukhopadhyay [1976] relating to the point estimation problem is proved. Also moderate sample size behaviour of this stopping time has been studied by Monte-Carlo methods.     

Simpler Probabilistic Population Forecasts: Making Scenarios Work

The traditional high-low-medium scenario approach to quantifying uncertainty in population forecasts has been criticized as lacking probabilistic meaning and consistency. This paper shows, under certain assumptions, how appropriately calibrated scenarios can be used to approximate the uncertainty intervals on future population size and age structure obtained with fully stochastic forecasts. As many forecasting organizations already produce scenarios and because dealing with them is familiar territory, the methods presented here offer an attractive intermediate position between probabilistically inconsistent scenario analysis and fully stochastic forecasts.     

Productivity and Welfare

Technical change is generally characterized by a rate and biases, both evaluated for given producer prices. This paper examines the potential discrepancy between this rate and the corresponding rate of consumer welfare change as measured by Allais distributable surplus. We postulate a general equilibrium context with various market failures (taxes, quotas, imperfect competition, and “poorly priced” commodities), and use comparative statics to express the rate of welfare change in terms of the rate and biases of the technical change. An elementary simulation model of a taxed economy suggests that the rate of welfare change may differ from the rate of technical change by as much as 50% under plausible circumstances.     

Bank mergers and components of risk: An evaluation

The present study empirically examines the contribution of the acquired banks in only the nonconglomerate types of mergers (i.e., banks with banks), where the bulk of the payment is in the form of equity to the acquiring bank and finds overwhelmingly statistically significant evidence that nonconglomerate types of mergers definitely reduce the total as well as the unsystematic risk while having no statistically significant effect on systematic risk. Therefore, it seems that diversification may be a possible motive for bank mergers.     

Airport infrastructure spillovers in a network system

Airports in the US air transport network have become increasingly congested, leading to delays for business travelers and freight shipments. Since disruptions in one part of the network exacerbate problems throughout the system, airport infrastructure expansions to enhance air traffic flows confer travel-time savings and reliability benefits, and thus increased worker productivity and shipping efficiency for manufacturing firms. We evaluate such spillovers, and find that higher own-state airport infrastructure implies lower manufacturing costs from both labor- and materials-savings. Airport expansion in connected states has a comparable effect for states with hub airports, and an even greater impact for other states.     

Job satisfaction and gender: Why are women so happy at work?

By most objective standards, women's jobs are worse than men's, yet women report higher levels of job satisfaction than do men. This paper uses a recent large-scale British survey to document the extent of this gender differential for eight measures of job satisfaction and to evaluate the proposition that identical men and women in identical jobs should be equally satisfied. Neither the different jobs that men and women do, their different work values, nor sample selection account for the gender satisfaction differential. The paper's proposed explanation appeals to the notion of relative well-being, especially relative to workers' expectations. An identical man and woman with the same jobs and expectations would indeed report identical job satisfaction, but women's expectations are argued to be lower than men's. This hypothesis is supported by the finding that the gender satisfaction differential disappears for the young, the higher-educated, professionals and those in male-dominated workplaces, for all of whom there is less likely to be a gender difference in job expectations.     

Lower Bound Restrictions on Intensities in Data Envelopment Analysis

We propose an extension to the basic DEA models that guarantees that if an intensity is positive then it must be at least as large as a pre-defined lower bound. This requirement adds an integer programming constraint known within Operations Research as a Fixed-Charge (FC) type of constraint. Accordingly, we term the new model DEA_FC. The proposed model lies between the DEA models that allow units to be scaled arbitrarily low, and the Free Disposal Hull model that allows no scaling. We analyze 18 datasets from the literature to demonstrate that sufficiently low intensities—those for which the scaled Decision-Making Unit (DMU) has inputs and outputs that lie below the minimum values observed—are pervasive, and that the new model ensures fairer comparisons without sacrificing the required discriminating power. We explain why the low-intensity phenomenon exists. In sharp contrast to standard DEA models we demonstrate via examples that an inefficient DMU may play a pivotal role in determining the technology. We also propose a goal programming model that determines how deviations from the lower bounds affect efficiency, which we term the trade-off between the deviation gap and the efficiency gap.     

Post-euro EU and US interest rates and foreign exchange rates: Are they in harmony or in disarray?

This paper focuses on: (1) how a select set of financial and economic factors could set the path for interest rates and foreign exchange rates, and (2) whether the resultant realized interest and exchange rates would be in harmony or in disarray. Using post-euro data for the EU and the US, an array of monetary rules is examined. In particular, the paper investigates whether the original and the extended Taylor rules provide an explanation of the dynamics of the EU monetary system since the inception of the euro. Our findings indicate that the EU and the US monetary responses are not the same and that exchange rates play a significant role.     

INTRODUCING MARKET FORCES INTO MANAGERIAL DECISION-MAKING IN CHINESE INDUSTRIAL ENTERPRISES

This paper focuses on the fundamental changes in the management of state enterprises that are taking place in China. Specifically, we discuss the expansion of enterprise autonomy and changes in the managerial decision-making structure. The genesis of the reform programme is traced back to inefficiencies caused by the over-centralized state planning system which reduced enterprise management to little more than an administrative function dominated by the Party secretary. As a consequence, managerial and technical cadres became demoralized and the growth of staff functions such as accounting, marketing and personnel management was stunted. From a series of experiments launched in 1978 has grown the realization that tinkering around with the state planning apparatus is insufficient to stimulate entrepreneurship and vigorous industrial expansion. Accordingly, reform has been launched on a broad front both within the state apparatus, in an endeavour to roll back external constraints on enterprise, and within the enterprise itself, by seeking to provide powerful incentives both to managerial cadres and workers through a system stressing individual responsibility and rewards commensurate with results. A number of severe constraints on the reform programme are analysed, in particular, the changing balance of power within the enterprise between the factory director, the Party secretary, the workers’congress and the trade union. Contradictions exist within the new structure of decision-making but, given a period of political stability and sustained economic growth, there should be sufficient surplus to mollify discontent and stifle those who refuse to give up their belief in the virtues of having‘politics in command’of the industrial enterprise.