Institutional evolution as an emerging focus in scenario planning

In this paper, we argue that institutional evolution should occupy a center stage in scenario development. During the last two decades, strategy models have neglected the institutional milieu, partly because analytical approaches to link institutional milieus and business contexts were underdeveloped. However, theoretical developments in institutional economics accomplished during this time period make it possible to connect the consequences of institutional evolution to strategy development. Further, with the increasing globalization of commerce, and the attendant complexity and turbulence in institutional evolution, particularly in emerging economies, significant opportunities for strategy related action may reside not in product markets but in institutional arenas. Institution-focused scenarios are therefore increasingly needed. We outline the key linkages between the institutional milieu and business contexts and illustrate how scenarios incorporating institutional parameters can shed light on the strategy context in the case of emerging economies.     

The Effects of Attributes on the Repeat Sales Pattern of Residential Property in Hong Kong

There has been copious research work on the development of house price models and the construction of house price indices. However, results in some studies revealed that the accuracy of such indices could be subject to selection bias when using only information from a sample of sold properties to estimate value movements for the entire housing stock. In particular, estimated house price appreciation is usually systematically higher among properties that change hands more frequently. It therefore suggests that the determination of important factors affecting the transaction frequency or intensity of a housing unit should be a more fundamental research question. This paper examines the possible factors that determine the popularity of residential unit by means of a repeated sales pattern. The Poisson regression model and event history analysis techniques are employed to assess the effect of attributes on transaction frequency and intensity. The event history analyses technique can take account of transaction-specific as well as time-dependent covariates, and therefore is recommended for analyzing repeated sales data in a real estate market. All transaction records during the period 1993–2000 from the Land Registry of one of the most popular residential estates in Hong Kong were used to illustrate the method. Unlike a response to favorable transaction price, good quality units do not necessarily inherently display a high transaction frequency. Rather, units of average quality are more likely to be transactionally active.     

Fiscal deficits and inflation

Macroeconomic theory postulates that persistent fiscal deficits are inflationary. Yet empirical research has had limited success in uncovering this relationship. This paper reexamines the issue in light of broader data and a new modeling approach that incorporates two key features of the theory. Unlike previous studies, we model inflation as non-linearly related to fiscal deficits through the inflation tax base and estimate this relationship as intrinsically dynamic, using panel techniques that explicitly distinguish between short- and long-run effects of fiscal deficits. Results spanning 107 countries over 1960-2001 show a strong positive association between deficits and inflation among high-inflation and developing country groups, but not among low-inflation advanced economies.     

Fiscal Consolidation and Decentralisation: A Tale of Two Tiers*

This paper contributes to the established literature on fiscal consolidations by investigating the distinct behaviour of central and sub‐central tiers of government during general government consolidation attempts. In the light of different degrees of decentralisation across OECD countries, and the different responsibilities devolved to sub‐central tiers, we believe that this approach offers an illuminating insight into the analysis of fiscal consolidations and their success. We show that the involvement of the sub‐central tiers of government is crucial to achieving cuts in expenditure, particularly in relation to the overall size of the government wage bill. In addition, central governments appear to exert a strong influence on the expenditure of sub‐central tiers through their grant allocations, and control of these allocations appears to have a considerable impact upon the overall success of consolidation attempts. Finally, we demonstrate that there is a skewness in cuts towards sub‐central capital expenditure both when central governments cut grant allocations and when sub‐central governments engage in lone consolidation attempts.     

Machine learning in individual claims reserving

Machine learning techniques make it feasible to calculate claims reserves on individual claims data. This paper illustrates how these techniques can be used by providing an explicit example in individual claims reserving.     

Tax penalties on fluctuating incomes: estimates from longitudinal data

Progressive personal income taxes can cause individuals with fluctuating incomes to pay more taxes over time than individuals with constant incomes of the same average value. The implicit tax penalty violates principles of equity and may harm efficiency by discouraging risk-taking activities, such as entrepreneurship. This paper uses longitudinal data to estimate the tax penalties in six panels of Canadian data from 1993 to 2010. The effects of various income averaging policies for mitigating tax penalties are then examined.     

Bank net interest margins,the yield curve,and the 2007–2009 financial crisis

Using quarterly call report data from 2000 to 2016, we reexamine the relationship between net interest margins (NIM) and the yield curve for more than 5,500 U.S. commercial banks. In the full sample, yield curve and RGDP growth have positive effects on NIM, while inflation and deposit‐to‐loan ratios (D/L) have negative effects. Splitting the sample around the 2007–2009 crisis, we show the impact of yield curve and RGDP growth on NIM increasing during the “recovery” (2009Q3 to 2016Q4), and inflation and D/L changing signs. Positive effects of yield curve on profits vary with bank size and change over time.     

Creation of models for calculation of coefficients of terrain passability

Quality & Quantity - The content of this article is a paper about a complex mathematical model of terrain passability which respects geographical and meteorological conditions in terrain and...     

Inference of the Russian drug community from one of the largest social networks in the Russian Federation

The criminal nature of narcotics complicates the direct assessment of a drug community, while having a good understanding of the type of people drawn or currently using drugs is vital for finding effective intervening strategies. Especially for the Russian Federation this is of immediate concern given the dramatic increase it has seen in drug abuse since the fall of the Soviet Union in the early nineties. Using unique data from the Russian social network ‘LiveJournal’ with over 39 million registered users worldwide, we were able for the first time to identify the on-line drug community by context sensitive text mining of the users’ blogs using a dictionary of known drug-related official and ‘slang’ terminology. By comparing the interests of the users that most actively spread information on narcotics over the network with the interests of the individuals outside the on-line drug community, we found that the ‘average’ drug user in the Russian Federation is generally mostly interested in topics such as Russian rock, non-traditional medicine, UFOs, Buddhism, yoga and the occult. We identify three distinct scale-free sub-networks of users which can be uniquely classified as being either ‘infectious’, ‘susceptible’ or ‘immune’.