Physical and Economic Consequences of Sea-Level Rise: A Coupled GIS and CGE Analysis Under Uncertainties

This paper develops a modelling framework that links GEMINI-E3, a multi-regional, multi-sectoral computable general equilibrium model with a cost-benefit analysis approach at local level using geographical information system tools to assess the physical and economic consequences of sea-level rise (SLR) in the twenty first century. A set of future scenarios is developed spanning the uncertainties related to global warming, the parameters of semi-empirical SLR estimates, and coastal developments (cropland, urban areas and population). The importance of incorporating uncertainties regarding coastal development is highlighted. The simulation results suggest that the potential development of future coastal areas is a greater source of uncertainty than the parameters of SLR itself in terms of the economic consequences of SLR. At global level, the economic impact of SLR could be significant when loss of productive land along with loss of capital and forced displacement of populations are considered. Furthermore, highly urbanised and densely populated coastal areas of South East Asia, Australia and New Zealand are likely to suffer significantly if no protective measures are taken. Hence, it is suggested that coastal areas needs to be protected to ameliorate the overall welfare cost across various regions.     

Uncertainty on survival probabilities and solvency capital requirement: application to long-term care insurance

In this paper, we focus on uncertainty issues on disabled lives survival probabilities of LTC insurance policyholders and its consequences on solvency capital requirement. Among the risks affecting long-term care portfolios, special attention is addressed to the table risk, i.e. the risk of unanticipated aggregate mortality, arising from the uncertainty in modeling LTC claimants survival law. The table risk can be thought as the risk of systematic deviations referring not only to a parameter risk but, as well, to any other sources leading to a misinterpretation of the life table resulting for example from an evolution of medical techniques or a change in rules of acceptance. In fine, the idea is to introduce the risk of systematic deviations arising from the uncertainty on the disabled lives death probabilities directly. We analyze the consequences of an error of appreciation on the disabled lives survival probabilities in terms of level of reserves and describe a framework in an Own Risk and Solvency Assessment perspective to measure the gap between the risk profile from the standard formula to the risk analysis specific to the organism.     

Understanding Local Food Consumers: Theory of Planned Behavior and Segmentation Approach

Purpose: The objectives of this study were to examine the antecedents and consequence of consumer attitudes toward local food and to segment these consumers using their food-related lifestyle (FRL) attributes. Using the Theory of Planned Behavior, we proposed three factors to impact attitude toward local food (health consciousness, concern for the environment, and concern for local economies) along with subjective norm and perceived behavioral control to influence intentions to purchase local food.

Methodology: Data were collected from 502 local food consumers measuring the following: antecedents and consequence of attitude toward local food; FRL; demographic information.

Findings: Health consciousness, concern for the environment, and concern for local economies were found to be significant predictors of attitude toward local food. Attitude toward local food and subjective norm, but not perceived behavioral control, were found to have a significant effect on intention to purchase local food. Further, segmenting based on their FRL yielded four types of consumers (Impromptu Novelty Explorer, Uninvolved Connoisseur, Involved Information Seeker, and Apathetic Local Food Consumer). An ANOVA provided a snapshot of several demographic and psychographic differences between segments.     

Extreme events and the cumulative distribution of net gains in gambling and structured products

We argue that ethical principles in advertising and market communication cannot be properly discovered and applied to gambling without a deep understanding of its probabilistic implications, in particular when extreme events are influential. We carry out a probabilistic analysis of lottery games with lifetime prizes in order to derive sound recommendations about the pertinent information that should be communicated to nudge gamblers. We propose to focus on the cumulative distribution of net gains, for which there is currently no information available to gamblers. This holds true for structured products in which extreme events matter as well.     

Optimal fiscal policy in sunspot‐driven oligopolistic economies

Economies with oligopolistic markets are prone to inefficient sunspot fluctuations triggered by autonomous changes in firms equilibrium conjectures. A well‐designed taxation‐subsidization scheme can eliminate these fluctuations by coordinating firms in each sector on a single equilibrium, left unaffected. The optimal taxation scheme must select the number of active firms that makes the best trade‐off (in terms of consumer welfare) between the markup and the scale inefficiency distortions. Implementing such stabilization policy leads to significant welfare gains, attributable to an “efficient stabilization effect,” typically ignored in usual computations of the welfare costs of fluctuations.     

Real-life cost of vitamin K antagonist treatment in patients with non-valvular atrial fibrillation in France in 2013

Aims: Data highlighting the cost drivers for non-valvular atrial fibrillation (NVAF) patients in terms of vitamin K antagonist (VKA) treatment and monitoring are lacking in France. This study aimed to evaluate the real-life daily cost of VKA treatment in 2013, in French patients suffering from NVAF.

Methods: This longitudinal observational study was performed using the EGB (Echantillon Généraliste des Bénéficiaires) database, a random sample of the French national insurance (NHI) database, which covers 80% of the population. All adult patients whose first NVAF anticoagulant treatment in 2013 was a VKA were analyzed. Costs were calculated for the duration of follow-up and then divided by the number of days of therapy. The analysis was performed both from the French NHI perspective (amount reimbursed by the NHI) and from a collective perspective.

Results: In this study, 3,254 NVAF patients treated with VKA in 2013 were included, and this sample comprised 52.6% males. The mean daily cost of VKA treatment was €1.13 (±1.18) according to the collective perspective (89.4% of this cost was associated to INR measurement) and €1.05 (±1.16) according to the NHI perspective.

Limitations: As diagnoses associated with procedures are not available in the EGB database, proxies were used, and an algorithm was created to define the AF population.

Conclusions: This analysis is the first to consider an exhaustive spectrum of the costs of VKA treatment in France using EGB data. VKA medication requires exhaustive follow-up, and, thus, associated costs are important. The results of the present study confirmed this close follow-up for VKA patients, making the cost of treatment by VKA nearly 10-times more expensive than the cost of medication itself.     

The effect of offshoring on knowledge flows in the US automobile industry

This paper examines the impact of financial constraints on innovation for established firms. We make use of a direct measure of the existence of financial constraints obtained thanks to a specific survey addressed to French established firms. This is a distinctive feature of this paper as most of previous studies had to rely on proxies (like the cash-flow sensitivity), which may be subject to interpretation problems. The probability to have innovative activities and the probability to face financial constraints are simultaneously estimated by a recursive bivariate probit model. Accounting for the endogeneity of the financial constraint variable, we find that financial constraints significantly reduce the likelihood that firms have innovative activities. The probability to encounter financial constraints is explained by firms’ ex ante financing structure and economic performances.     

Econophysics review: II. Agent-based models

This article is the second part of a review of recent empirical and theoretical developments usually grouped under the heading Econophysics. In the first part, we reviewed the statistical properties of financial time series, the statistics exhibited in order books and discussed some studies of correlations of asset prices and returns. This second part deals with models in Econophysics from the point of view of agent-based modeling. Of the large number of multi-agent-based models, we have identified three representative areas. First, using previous work originally presented in the fields of behavioral finance and market microstructure theory, econophysicists have developed agent-based models of order-driven markets that we discuss extensively here. Second, kinetic theory models designed to explain certain empirical facts concerning wealth distribution are reviewed. Third, we briefly summarize game theory models by reviewing the now classic minority game and related problems.     

The World Market for Labor and the World Market for Industrial Sites

At the center of the on-going debate about the U.S. Social Security system is the question of whether the way the system is financed can cope with the future challenges posed by the retiring Baby Boom generation. The "reformers" suggest changing the design of the system by moving to fully funded defined contribution retirement plans. Others argue that the so-called demographic problems are being used as an excuse to privatize the system. But both sides spend almost all of their energy and time figuring out the timing of insolvency of the system and the validity of the assumptions made in each forecast. In contrast, the present study closely examines the changing macroeconomic dynamics of the system since the 1960s. The analysis shows that undermining of the system is caused not by demographic changes or financing mechanisms but by low wages and medical inflation.