How financial intermediation impacts on financial stability?

The great financial crisis widened the role of financial intermediation in financial stability. This study develops a new financial intermediation variable, credit cash flow (CCF), which enables measurement of the net financial flow resulting from loan activity. An analysis provides evidence that CCF affects the capital buffer via credit gap behaviour, thus indicating the existence of a channel between the CCF and the capital buffer. Such a link offers the policy-maker the possibility to monitor the behaviour of financial intermediation carried out by banks, in order to avoid the outbreak of financial instability events.     

A study on the attributes involved in the hedonic pricing of Brazilian clothing

The objective of this study is to identify the weighted importance of intrinsic and extrinsic attributes. Intrinsic attributes are defined as the specific features of products. Extrinsic attributes refer to other characteristics that are also important for price composition, such as brand, store layout and services, and purchasing experiences. In a survey with 1,923 collected responses, it was possible to identify and quantify intrinsic and extrinsic influencing factors beyond price strategy in the Brazilian fashion market for blue jeans. The statistical analysis was based on the hedonic price method. The idea of expressing the price based on a series of intrinsic and extrinsic variables avoids the problem of using the regression technique. In this research, multiple linear regression and quantile regression were applied. The results show that extrinsic attributes have greater influence than intrinsic features on explaining the final market prices using log-linear and quantile regression statistical methods.     

Discovering quiescent meanings in technologies: exploring the design management practices that support the development of Technology Epiphanies

In contemporary business and academia, design has been increasingly viewed as an important strategic asset such that several scholars and executives have recently investigated the links among design, innovation and competitive advantage. Indeed, recent and emerging literature streams are exploring the potential contribution design can provide in valorising and differently adopting new or existing technologies [Dell’Era, Marchesi, and Verganti 2010. “Mastering Technologies in Design-Driven Innovation – How Two Italian Companies Made Design a Central Part of their Innovation Process.” Research Technology Management 53 (2): 12–23 Buganza et al. 2015. “Unveiling the Potentialities Provided by New Technologies: A Process to Pursue Technology Epiphanies in the Smartphone App Industry.” Creativity and Innovation Management 24 (3): 391–414]. This paper aims to investigate the design managerial practices able to support Technology Epiphanies, which are defined as the discovery of quiescent meanings in new or existing technologies [Verganti 2009. Design-Driven Innovation. Changing the Rules of Competition by Radically Innovating What Things Mean. Boston: Harvard Business Press]. The paper relies on four in-depth case studies developed by both primary and secondary sources: Nintendo, Kartell, Technogym and KUKA Robotics. The paper identifies three design management practices that can guide managers in the development of Technology Epiphanies: interpreting technology as an enabling platform, building double-sided network and accessing new knowledge domains.     

Strategic foresight in corporate organizations: Handling the effect and response uncertainty of technology and social drivers of change

Today many companies in many industries put a lot of efforts into monitoring and investigating emerging drivers of change in their business environment, particularly in relation to new technologies and events in the social, economic, political and ecological landscapes which surround their industry. So far scholars in the literature on foresight and future studies focused on the techniques and practices for analysing the “state” uncertainty about the likely path of evolution of emerging drivers of change. Anyway, less attention was devoted to the “effect” uncertainty about the impact of drivers of change on the competitive position of the firm and to the “response” uncertainty about how to take advantage of these drivers. These are the main issues we take into account, through a field research on firms that, notwithstanding they were able to properly assess the likely evolution (state uncertainty) of relevant drivers of change in their industry, either were successful or dramatically failed in handling the effect and response uncertainty of these drivers. Moreover, we carried out multiple case studies of some large companies that have established an organizational unit dedicated to strategic foresight. Overall, the results of our research may contribute to improve the effectiveness of strategic foresight and to increase its value added to the planning process of corporate firms, while providing helpful insight to public organizations that promote foresight exercises for enhancing the competitiveness of local firms.     

Reducing microbiological risk in the kitchen: piloting consensus conference methodology as a communication strategy

Foodborne diseases are a major public health problem. Improper storage and food preparation at home can favour microbial contamination of food. Consumers play a crucial role in controlling this risk. To reduce exposure to risk, it is essential to provide information and guidance on contamination management in the home. The aim of this study was to pilot a method of participatory communication addressed to young consumers and designed to reduce the microbiological risks associated with the consumption of meat products. The methodology was based on application of the ‘consensus conference’ model on food safety issues. The consensus conference served not only as a participatory strategy to share knowledge but also as a method for sharing in the development of risk communication content (guidelines) to be disseminated to the reference target. Young people’s perceptions, habits and behaviour in the kitchen were explored in the preparatory stage of the consensus conference by means of a survey and a focus group. Three consensus conferences were held in Italy attended by 60 university students (19 and 22 years old). Application of the consensus conference model as a communication process proved to be an effective opportunity to engage young consumers and experts on the topic of food safety. This discursive participation approach was broadly welcomed by the participants. Specifically, direct interaction with the experts was considered to be an important part of the communication process. The findings of the project were used to select concise communication content based on the perceptions, behaviours and fact-finding needs of the selected target. Publication of this content in the form of guidelines on microbiological risk management at home has enabled the results of the consensus conferences to be extended and the targeted communication material on risk reduction in daily food handling practices to be disseminated.     

Model-Based and Nonparametric Approaches to Clustering for Data Compression in Actuarial Applications

Clustering is used by actuaries in a data compression process to make massive or nested stochastic simulations practical to run. A large data set of assets or liabilities is partitioned into a user-defined number of clusters, each of which is compressed to a single representative policy. The representative policies can then simulate the behavior of the entire portfolio over a large range of stochastic scenarios. Such processes are becoming increasingly important in understanding product behavior and assessing reserving requirements in a big-data environment. This article proposes a variety of clustering techniques that can be used for this purpose. Initialization methods for performing clustering compression are also compared, including principal components, factor analysis, and segmentation. A variety of methods for choosing a cluster's representative policy is considered. A real data set comprising variable annuity policies, provided by Milliman, is used to test the proposed methods. It is found that the compressed data sets produced by the new methods, namely, model-based clustering, Ward's minimum variance hierarchical clustering, and k-medoids clustering, can replicate the behavior of the uncompressed (seriatim) data more accurately than those obtained by the existing Milliman method. This is verified within sample by examining location variable totals of the representative policies versus the uncompressed data at the five levels of compression of interest. More crucially it is also verified out of sample by comparing the distributions of the present values of several variables after 20 years across 1000 simulated scenarios based on the compressed and seriatim data, using Kolmogorov-Smirnov goodness-of-fit tests and weighted sums of squared differences.     

Equilibrium reserve prices in sequential ascending auctions

We study a model where bidders have perfectly correlated valuations for two goods sold sequentially in two ascending-price auctions. The seller sets a reserve price before the beginning of each auction. Despite the lack of commitment by the seller, we characterize an equilibrium and study its properties. Strategic non-disclosure of information takes the form of non-participation in the early auction by low-valuation bidders, while high-valuation bidders bid up to their true valuations. Some buyers who would profitably buy at the reserve price refrain from participating in order to decrease the second-auction reserve price.     

Are external shocks responsible for the instability of output in low-income countries?

External shocks, such as commodity price fluctuations, natural disasters, and the role of the international economy, are often blamed for the poor economic performance of low-income countries. This paper quantifies the impact of these different external shocks using a panel vector auto-regression approach and determines their contributions to output volatility in low-income countries. We find that they can only explain a small fraction of the output variance of a typical low-income country. Other factors, most likely internal causes, are the main source of fluctuations. From a quantitative perspective, the output effect of external shocks is typically small in absolute terms, but significant relative to the historic performance of these countries.