Urban Land Development and its Prices: The Effects of Conversion Costs with Redevelopment

This paper analyzes urban land development when landowners anticipate a future large-scale redevelopment by a third party developer. Landowners' initial development activities can deter such redevelopment because they impose two conversion costs on the redeveloper: demolition costs and landowners' reservation prices. These costs are eventually borne by the landowners when the developers' market is competitive. For the landowners' initial development activities, we analyze both the efficient solution and the noncooperative solution under the Nash equilibrium. In both cases, the possibility of redevelopment results in a lower level of initial development due to the conversion costs, but increases land prices. However, the magnitude of their effects is smaller in the Nash solution due to an externality. The presence of such an externality provides a rationale for zoning and urban planning.     

Fairly priced deposit insurance,incentive compatible regulations,and bank asset choices

This article provides incentive compatible regulations that support fairly priced deposit insurance in a competitive banking industry. If informational asymmetry exists between the regulator and banks regarding loan quality, but the regulator can observe actual loan rates charged, then imposing a capital requirement schedule that leads market loan rates to decrease in loan quality is shown to be incentive compatible. Competition in the loan market induces banks to be indifferent to all loans that satisfy a minimum acceptable quality and reject all riskier loans. The regulator could reduce the banking industry's riskiness by imposing stricter capital requirements that increase this minimum quality.     

Some Policy Lessons from the Opening of the Korean Insurance Market

This article examines the recent dispute between the UnitedStates and the Republic of Korea over the opening of Korea'sinsurance market to U.S. companies. The article assesses theinterests and motivations of both countries that lay behindthe formal arguments presented during the negotiation process.It also analyzes whether the long-run interests of both developingand industrial countries would be well served by the approachto the opening of the market adopted in this case—sharingthe rent while continuing to regulate the insurance market.The analysis suggests that the opening of a developing country'sinsurance market (or the wider financial services market) wouldserve the long-run interests of both developing and industrialcountries only if it were accomplished in the context of overalldomestic liberalization of the finance industry. "Opening" ofthe market, if this means only the sharing of the rents thatwere generated by regulation of the market, is unlikely to bebeneficial to developing countries.     

Morphology analysis for technology roadmapping: application of text mining

The practice of technology roadmapping (TRM) has received much attention from researchers and practitioners, to support planning and forecasting in companies and sectors. However, little research has focused on the support of well-organized information for more effective roadmapping and the presentation of in-depth configurations of new products or technology. This paper proposes a roadmapping methodology to assist decision-making by applying a systematic approach based on quantitative data. To this end, key information is extracted from documents such as product manuals and patent documents by text mining, which is then used to identify the morphology of existing products and technology. Morphology analysis (MA) also plays a crucial role in deriving promising opportunities for new development of product or technology by matching product and technology morphology. Therefore, MA-based TRM can enable the effective exploitation of large quantities of significant information that might otherwise be left untapped, supporting innovation by generating a comprehensive set of detailed product and technology configurations. The proposed MA-based TRM approach can be applied to both incremental and radical innovation, supporting both market pull and technology push. The method is illustrated with a detailed example for mobile phones to demonstrate its practical application.     

Do real exchange rates really follow threshold autoregressive or exponential smooth transition autoregressive models?

Nonlinear models, especially threshold autoregressive [TAR] and exponential smooth transition autoregressive [ESTAR] classes, are widely applied for modeling real exchange rates in order to examine the validity of purchasing power parity [PPP]. Even though the nonlinear models are theoretically well-motivated, some of the recent findings cast doubts on their relevance for real exchange rates. In particular, the nonlinear models do not necessarily yield improved out-of-sample forecasts over linear models and add little value in resolving the well-documented PPP puzzle. Utilizing a nonparametric entropy measure of dependence proposed by Granger et al. (2004), we show, in this study, that the real exchange rates from four major countries had exhibited quite strong nonlinear serial dependence, which linear autoregressive models fail to replicate. Furthermore, the nonlinear TAR and ESTAR models estimated for the real exchange rates also have some difficulty in generating significant serial dependence structure actually observed in the data. Overall, other nonlinear models than the currently entertained TAR and ESTAR should be considered to study the dynamics of the real exchange rates.     

The effect of category label specificity on consumer choice

The current research demonstrates the category specificity effect, whereby an individual’s choice of options belonging to different categories depends on whether the options are categorized in a specific or abstract manner. In particular, when categories do not contain labels that specifically convey category knowledge, individuals tend to view the assortment as having more varied alternatives, leading to greater variety-seeking. Three laboratory studies employing the context of food menu selections were conducted to test our hypotheses. Study 1 and Study 2 reveal that, given the identical assortment of dishes, individuals are likely to order a greater variety of dishes when the menu contains no category labels or abstract category labels, as opposed to when it contains specific category labels. Furthermore, the use of abstract category labels increases the number of dishes individuals order. We further show that this category specificity effect on choice is mediated by the enhanced perception of variety offered in the menu. Study 3 demonstrates that the effect of category specificity is moderated by an individual’s familiarity with the food category.     

A dynamic forecasting model for nursing manpower requirements in the medical service industry

Today there is an increasing demand for quality health care throughout the world. Such demand requires the medical service industry to equip with high technologies and high caliber professionals (e.g., doctors and nurses), to contain cost and improve quality of care. Since the medical service industry constantly suffers from the shortage of nursing manpower, forecasting the supply and demand of nursing manpower is an important issue. This study proposes a forecasting model for nursing manpower requirement using system dynamics. Data were collected from authorized institutions in Korea and were used as inputs of the model. The results show that the demand for nursing manpower exceeded the supply during the forecasting period (2006–2020), which requires both national and the medical service industry attention for sustained quality health care.     

Empirically testing ES success factors in business process reengineering

Previously proposed success factors for Expert Systems implementation are field tested in the context of business process reengineering (BPR) projects. Due to its nature mimicking human expert behavior, ES technology applications in BPR provide a unique opportunity to study major organization changes within a relatively short time. Using Pearson correlations and multivariate regression analysis, eight ES implementation success factors proposed in the literature were empirically tested in this study in terms of their importance to the BPR benefits derived from the application. Sixty-two ES applications within E.I. Dupont de Nemours and Company dealing with business process changes significant enough to be called BPR were used. Despite the relatively small sample size, six of the eight success factors were corroborated: user satisfaction with the ES, the importance and difficulty of the business problem addressed, user attitudes toward ES technology and the particular ES project, the degree of user involvement in the ES implementation process, and the ES developer(s) skills.