An information approach to international currencies

Models of currency competition focus on the 5% of trading attributable to balance-of-payments flows. We introduce an information approach that focuses on the other 95%. Important departures from traditional models arise when transactions convey information. First, prices reveal different information depending on whether trades are direct or though vehicle currencies. Second, missing markets arise due to insufficiently symmetric information, rather than insufficient transactions scale. Third, the indeterminacy of equilibrium that arises in traditional models is resolved: currency trade patterns no longer concentrate arbitrarily on market size. Empirically, we provide a first analysis of transactions across a full market triangle: the euro, yen and US dollar. The estimated transaction effects on prices support the information approach.     

Information search and consideration set formation in a web-based store environment

The research reported here attempts to understand information search and consideration set formation in a web-based choice environment. A conceptual model is used to propose hypotheses that link information search and consideration set formation with two task environment influences that are typical of online settings. A study that simulates information search and consideration set formation in a web-based choice environment is conducted to test the hypotheses. The results offer insights into how the number of available alternatives and the amount of time available may have an effect on search and evaluation in a web-based store. The research has implications for understanding how consumers shop in online stores.     

Children and the Changing World of Advertising

Concerns about children's ability to fully comprehend and evaluate advertising messages has stimulated substantial research and heated debate among scholars, business leaders, consumer advocates, and public policy makers for more than three decades. During that time, some very fundamental questions about the fairness of marketing to children have been raised, yet many remain unresolved today. With the emergence of increasingly sophisticated advertising media, promotional offers and creative appeals in recent years, new issues have also developed. This paper provides a basis for further examination of some the key questions in this area, and suggests how children's advertising research can be employed to illuminate them.     

Adding a freight network to a national interstate input–output model: a TransNIEMO application for California

The state of the nation’s infrastructure is the subject of widespread discussion and comment because it is thought to include many deteriorating and unsafe bridges. Ever since the terrorist attacks of 9/11, there has been increasing concern over the extent to which an attack on infrastructure could result in serious economic disruption. This research develops a model to analyze the economic consequences of an attack on a major element of the highway network. We add a freight network to a national multiregional economic impact model and make freight traffic flows endogenous. The use of a sub-national interstate model recognizes that most infrastructure planning is at the state level and most political leaders’ interest is local. We base our approach on the National Interstate Economic Model (NIEMO) and refer to an elaboration that we name Transportation network and the National Interstate Economic Model (TransNIEMO). The new model enables us to study the state-specific and industry-specific economic impacts of some significant changes in the nature of highway freight movements. We tested the model for selected freight movements in and out of California. The results are entirely plausible and encourage us to elaborate and test the model for hypothetical disruptions of freight traffic throughout the US.     

New Economic Indicators for Australia, 1949-84

This article attempts to identify and describe the main characteristics of Australia'a business cycles during the period 1949 to 7984 with the aid of leading, coincident, and lagging indicators, using the methodology of the International Economic lndicator project at the Center for lnternational Business Cycle Research, Columbia University, New York. The methodology to identify Australia's classical cycle and growth cycle chronologies is discussed. Reviews are made of the lead-lag patterns of, first, both chronologies in relation to the specific cycles of the individual coincident indicators, and second, the growth chronology in relation to the leading and lagging indicators. Australia's growth cycle chronology is compared with the chronology of other countries, notably of United States, United Kingdom, and Japan. The general uses of an indicator analysis are reviewed. An appendix compares the reference cycle chronologies previously available for Australia and the indicators used to obtain them.     

Foundations of Incomplete Contracts

In the last few years, a new area has emerged in economic theory, which goes under the heading of "incomplete contracting". However, almost since its inception, the theory has been under attack for its lack of rigorous foundations. In this paper, we evaluate some of the criticisms that have been made of the theory, in particular, those in Maskin and Tirole (1999 a ). In doing so, we develop a model that provides a rigorous foundation for the idea that contracts are incomplete.     

The economic value of INTUITY in aortic valve replacement

Objective: The recent development of the EDWARDS INTUITY Elite? (EIE) valve system enables the rapid deployment of a prosthetic surgical heart valve in an aortic valve replacement (AVR) procedure via both the minimally invasive (MISAVR) and conventional (CAVR) approaches. In order to understand its economic value, this study performed a cost evaluation of the EIE valve system used in a MIS rapid-deployment approach (MIS-RDAVR) vs MISAVR and CAVR, respectively, compared to standard prosthetic aortic valves.

Methods: A simulation model was developed using TreeAge (and validated with MS Excel) to compare the inpatient utilization and complication costs for each treatment arm. Thirty-day clinical end-points for the MIS-RDAVR (mortality and complications) were taken from the TRANSFORM trial; and a best evidence review of the published literature was used for the MISAVR and CAVR approaches. Studies were pooled and parameter estimates were weighted by sample size in order to compare the TRANSFORM patients. Cost data (2016 USD) were taken from the Premier database. Incremental cost and cost-effectiveness was assessed and one-way/probabilistic sensitivity analyses performed to gauge the robustness of the results.

Results: MIS-RDAVR costs $2,621 less than CAVR and had lower mortality rates, making it a superior (dominant) technology relative to CAVR. MIS-RDAVR costs $4,560 more than MISAVR, but was associated with an additional 0.20 life years-per-patient. This implies a cost-effectiveness ratio of $22,903 per-life-year-gained. Thus, MIS-RDAVR is cost-effective compared to MISAVR.

Conclusions: The EIE valve system deployed in a MIS approach appears to be a cost-effective technology compared to MISAVR and CAVR. When compared to CAVR it may achieve cost savings as well. These results suggest that MIS-RDAVR confers superior economic value compared to both standard MISAVR and CAVR via lowered key complication rates (re-operation, renal complications, wound infection, TIA, endocarditis) and utilization (cross-clamp time, hospital ward days).     

Combining information for prediction in linear regression

This article deals with the prediction problem in linear regression where the measurements are obtained using k different devices or collected from k different independent sources. For the case of k=2, a Graybill-Deal type combined estimtor for the regression parameters is shown to dominate the individual least squares estimators under the covariance criterion. Two predictors ŷ _c and ŷ _p are proposed. ŷ _c is based on a combined estimator of the regression coefficient vector, and ŷ _p is obtained by combining the individual predictors from different models. Prediction mean square errors of both predictors are derived. It is shown that the predictor ŷ _p is better than the individual predictors for k≥2 and the predictor ŷ _c is better than the individual predictors for k=2. Numerical comparison between ŷ _c and ŷ _p shows that the former is superior to the latter for the case k=2.