Price premiums and low cost carrier competition

This study presents a time series examination of price premiums in the US airline industry. Price premiums are defined as price markups due to domination and concentration at the airport and route market levels. The differential effect of these price premium drivers is empirically investigated, and it is shown that the largest components of price premiums are those from airport market share and airport concentration. The effect of low cost carrier competition on the level and composition of price premiums is of particular interest in this study. The results indicate that low cost carriers do not charge price premiums, and that high cost carriers’ price premiums tend to be lower when there is competition by low cost carriers. While the absolute values of price premiums have been fairly constant over the 1992–2002 time frame, the proportion of US passengers subject to price premiums has decreased due to the increasing share of low cost carrier traffic.     

Actuarial Science Summer Program for Women and Minorities

Drake University offered a 5‐day program focusing on the recruitment of women and minorities into actuarial science studies. A few universities offer actuarial science summer camps targeting high school students. Participants in this camp, however, came exclusively from community colleges. In this article, we provide an overview of the camp's activities, structure, and outcomes. We present a longitudinal analysis of student feedback, reflecting results from one survey administered before the camp began and another distributed very near the camp's end. Our results indicate the camp succeeded on many counts.     

Ridge regression revisited

In general ridge (GR) regression p ridge parameters have to be determined, whereas simple ridge regression requires the determination of only one parameter. In a recent textbook on linear regression, Jürgen Gross argues that this constitutes a major complication. However, as we show in this paper, the determination of these p parameters can fairly easily be done. Furthermore, we introduce a generalization of the GR estimator derived by Hemmerle and by Teekens and de Boer. This estimator, which is more conservative, performs better than the Hoerl and Kennard estimator in terms of a weighted quadratic loss criterion.     

Fit für den Arbeitsmarkt der Zukunft?

Zusammenfasung  Fehlzeitenentwicklung im Berufsfeld Pflege — Die zunehmende ?konomisierung der Krankenhauslandschaft und die bekannten demografischen Ver?nderungen in der Gesellschaft lassen den Bedarf an Pflegeleistung steigen, bedeuten für Pflegende sich wandelnde Arbeitsbedingungen und für Krankenh?user ver?nderte Altersstrukturen der Mitarbeiter. Literatur unter Kontext auf www.heilberufe-online.de     

Economics in the Backyard: How Much Convergence is there between China and her Special Regions?

This paper tests the hypothesis that the links and dependency relationships between China and her special regions have changed over the past 20 years with the industrialisation of China, and the emergence of Taiwan as a source of investment and sophisticated manufactures, and Hong Kong as financial centre and supplier of services. Has this changed the size and direction of spillovers in the region, and has it curtailed or eliminated American economic leadership? We use time‐varying spectral methods to decompose the links between six advanced Asian economies and the US. We find: (a) the links with the US have been weakening, while those within a bloc based on China have strengthened; (b) that this is not new – it has been happening since the 1980s, but has now been reversed by the surge in trade; (c) that Taiwan is more integrated with, and dependent on, the Chinese economy, while Hong Kong continues her separate development based on specialisation and comparative advantage; (d) that the links with the US are rather complex, with the US able to shape the cycles elsewhere through her control of monetary conditions, but the China zone able to control the size of their cycles; and (e) there appears to be no real evidence that pegged exchange rates encourage convergence; in fact the reverse may be true.     

FX volatility forecasts and the informational content of market data for volatility

The paper examines the medium-term forecasting ability of several alternative models of currency volatility. The data period covers more than eight years of daily observations, January 1991 to March 1999, for the spot exchange rate, 1- and 3-month volatility of the DEM/JPY, GBP/DEM, GBP/USD, USD/CHF, USD/DEM and USD/JPY. Comparing with the results of ‘pure’ time series models, the reported work investigates whether market implied volatility data can add value in terms of medium-term forecasting accuracy. This is done using data directly available from the marketplace in order to avoid the potential biases arising from ‘backing out’ volatility from a specific option pricing model. On the basis of the over 34 000 out-of-sample forecasts produced, evidence tends to indicate that, although no single volatility model emerges as an overall winner in terms of forecasting accuracy, the ‘mixed’ models incorporating market data for currency volatility perform best most of the time.