Heuristic learning and the discovery of specialization and exchange

I develop and calibrate an agent-based model of boundedly rational, adaptive agents in a two-good production and exchange economy to replicate human-subject outcomes in the same eight-person experimental economy. To test agents’ ability to capture human behavior, I extend the model and use its output to make predictions about a second experimental environment in which the group of eight agents is slowly constructed by merging smaller groups. This environment improves human-subject performance in the specialization and exchange task, and commensurate improvement emerges for some parameterizations of the agent-based model. This iterative process yields incremental improvement of decision-level theories about economic discovery.     

Are we operating effectively? A lean analysis of operating theatre changeovers

Hospital operating theatres are a critical but costly resource in healthcare processes. Their efficiency and utilisation impact upon hospital finances, clinical effectiveness and patient outcomes. Operations management techniques have now been applied widely to optimise flow. An important challenge is to balance the needs of process flexibility, efficiency and work standardisation with clinical requirements. This paper applies operations management methods to analyse elective orthopaedic surgery at five international hospitals to describe the issues that affect operating theatre productivity. It utilises an innovative method of video analysis to observe patient changeovers over 29 days of surgery and data is analysed to understand the causes of variability and waste. The findings suggest that processes which are standardised via operations management methodologies can improve productivity in a process that exhibits wide variation in practice. There are apparent trade-offs associated with efficiency and clinical concerns such infection control, that lead to different standard process archetypes being utilised. Recommendations for standardising patient changeovers are provided.     

Carbon efficiency of US colleges and universities: a nonparametric assessment

Under the American College and University Presidents’ Climate Commitment (ACUPCC), institutes of higher education have pledged to pursue a goal of carbon neutrality. We utilize emissions reported under the ACUPCC agreement and a nonparametric data envelopment analysis approach in order to evaluate the relative performance of signatories to the agreement in terms of producing teaching and research with the least greenhouse gas emissions. We find that while many signatory institutions are now producing their desirable outputs relatively efficiently in terms of carbon emissions, there still exists considerable variation in efficiency and potential for improvement. Results of a second stage efficiency change analysis shows evidence of both movement towards the efficiency frontier since signing, and some movement of the frontier itself, though this evidence comes primarily from teaching-focused institutions.     

Did Hayek have a monetary theory of business cycles?

Joseph Schumpeter, a careful reader of Hayek, categorized Hayek??s theory of economic cycles as non-monetary. Almost every other source, including Hayek himself, categorized the theory as monetary. The issue turns on the concept of causality being used. The question of what causality concept to apply to complex phenomena has substantive implications for economic theory. A simple concept of causality, appropriate to the study of some physical phenomena, will mislead when applied to complex phenomena. We provide examples of errors in analysis that follow from the wrong choice of a causal paradigm.     

Optimal Management of Soil Quality Stocks and Long-Term Consequences of Land Degradation for Smallholder Farmers in Malawi

While soil degradation has long-term consequences, static models which form the bulk of studies on this topic in Africa, do not account for the inter-temporal dimensions of optimal resource management. This paper used an inter-temporal optimisation framework, which considered soil in a time-dependent resource extraction perspective. We have demonstrated that soil degradation is causing an enormous reduction in productive value of smallholder land in Malawi. Current user cost of soil quality among smallholder farmers, which represents annual loss in productive value of land, was estimated to be US$21 per hectare. Based on this value and land area under smallholder agriculture in Malawi, economic costs of soil degradation among smallholder farmers were estimated to amount to 14% of the agricultural GDP for Malawi. Although smallholder farmers’ current practices are sub-optimal to Steady State solutions, they are above static solutions. This demonstrates that smallholder farmers have some private incentives to invest in the soil quality stock. Smallholder farmers internalise some of the dynamic costs of soil degradation under the current practices. However, a sensitivity analysis on a slightly higher discount rate indicates that SS solutions closely resemble the prevailing smallholder farming practices. This suggests that smallholder farmers may be overexploiting soil quality stock because they have a high time preference. That is, they value the current consumption more than their future consumption and wellbeing. High levels of poverty in Malawi and serious lack of viable alternatives to subsistence farming may be influencing such behaviour. Promoting more viable land use alternatives than subsistence farming and formuling policies that help transform smallholder agriculture into a profitable enterprise will not only increase the cost of degrading the soil, but also encourage farmers to invest in the soil quality stock.     

Experiments Testing Multiobject Allocation Mechanisms

This paper reports the results of over 130 auctions conducted under controlled conditions to examine the robustness of several auction mechanisms to allocate multiple objects. The simultaneous discrete auction process used by the Federal Communications Commission to allocate Personal Communications licenses was contrasted with a sequential auction and a combinatorial auction over a variety of demand conditions. In test environments created to check only the minimum competency of the procedures, the simultaneous discrete auction process produces highly efficient allocations, approaching levels similar to those found with a continuous form of the auction, and it outperforms a sequential auction. However, in environments created to stress test the procedures, a combinatorial auction outperforms the simultaneous discrete auction.     

A review and validation of overall survival extrapolation in health technology assessments of cancer immunotherapy by the National Institute for Health and Care Excellence: how did the initial best estimate compare to trial data subsequently made available?

Background: Validation of overall survival (OS) extrapolations of immune-checkpoint inhibitors (ICIs) during the National Institute for Health and Care Excellence (NICE) Single Technology Assessment (STA) process is limited due to data still maturing at the time of submission. Inaccurate extrapolation may lead to inappropriate decision-making. The availability of more mature trial data facilitates a retrospective analysis of the plausibility and validity of initial extrapolations. This study compares these extrapolations to subsequently available longer-term data.

Methods: A systematic search of completed NICE appraisals of ICIs from March 2000 to December 2017 was performed. A targeted search was also undertaken to procure published OS data from the pivotal clinical trials for each identified STA made available post-submission to NICE. Initial Kaplan-Meier curves and associated extrapolations from NICE documentation were extracted to compare the accuracy of OS projections versus the most mature data.

Results: The review identified 11 STAs, of which 10 provided OS data upon submission to NICE. The extrapolations undertaken considered parametric or piecewise survival models. Additional data cut-offs provided a mean of 18 months of OS beyond the end of the original data. Initial extrapolations typically under-estimated OS from the most mature data cut-off by 0.4–2.7%, depending on the choice of assessment method and use of the manufacturer- or ERG-preferred extrapolation.

Conclusion: Long-term extrapolation of OS is required for NICE STAs based on initial immature OS data. The results of this study demonstrate that the initial OS extrapolations employed by manufacturers and ERGs generally predicted OS reasonably well when compared to more mature data (when available), although on average they appeared to underestimate OS. This review and validation shows that, while the choice of OS extrapolation is uncertain, the methods adopted are generally aligned with later-published follow-up data and appear appropriate for informing HTA decisions.     

Charges in the Industrial Water Sector: Comparison Between Ireland and Spain

The European Treaty supports the application of the polluter pays principle in all environmental policies including the Water Framework Directive. This paper assesses the efficiency of water-charging systems in two European regions. The regions examined are the South west region of Ireland and the Navarre region in Spain which were selected because they are similar in terms of economic indicators but different in terms of water pricing structures. The paper describes the development and application of a simple model to analyse data on water-charging systems from these two regions. We present the results of a detailed scenario-based investigation illustrating the differences between experience, composition and basis, impact and constraints on the application of water charges for both regions. The key findings are that existing water charges do not provide incentives for users to use water efficiently and thereby do not contribute effectively to the environmental objectives of the Water Framework Directive.     

The legal challenge to ERISA preemptions

Managed care, once celebrated as a vehicle to halt the increasing cost of health care, has come under increasing fire from patients and health care providers, accused of cutting costs and managing care at the expense of patients. The Employee Retirement Income Security Act of 1974 (ERISA) has been a shield for managed care organizations (MCOs), buffeting them from liability for quality-of-care issues. Lawsuits and legislation are chipping away at the protective shield of ERISA as MCOs find themselves more liable for their decisions and for the care provided by physicians with whom the MCO contracts and provides financial incentives for controlling cost of medical care.