The impact of highways on commodity prices: The price of butter in Japan

This study empirically investigates the effect of highway construction on retail prices of butter in Japan. We consider the relocation of butter producers owing to the development of highways. We observed that highway construction increased transportation speed; however, the average transportation time from the production site dramatically increased with the increase in transportation distance. This was because of the concentration of butter factories in limited regions. Consequently, on average, the increase in transportation time during 1966–1980 raised the price of butter by 3.3 %. Furthermore, while the increase in speed reduced the price by 2 %, the increase in transportation distance increased the price by 5.3 %.     

Improving Order Fulfillment Performance through Integrated Inventory Management in a Multi-Item Finished Goods System

Effective inventory management is fundamental to order fulfillment excellence and supply chain success. In this paper, we develop a strategic inventory management decision tool that integrates inventory classification and inventory control policy decisions for maximizing order fulfillment performance, while accounting for a constraint on inventory budget and the profit expectation of a firm. This inventory solution tool provides critical enhancements to current inventory planning software, which is developed upon the traditional inventory classification scheme and where practitioners have to balance service levels and safety stock decisions through trial-and-error. The model allows firms to assess whether the current inventory performance is Pareto optimal, quantify the trade-offs between various performance measures, and identify the right inventory level according to the firms' strategic goals. In computational results, we demonstrate the trade-off and positive relationships between key item- and order-based inventory performance measures and short-term profitability under different levels of inventory budget in a multi-item finished goods inventory system.     

Public preferences for biodiversity conservation and climate-change mitigation: A choice experiment using ecosystem services indicators

Potential conflicts exist between biodiversity conservation and climate-change mitigation as trade-offs in multiple-use land management. This study aims to evaluate public preferences for biodiversity conservation and climate-change mitigation policy considering respondents’ uncertainty on their choice. We conducted a choice experiment using land-use scenarios in the rural Kushiro watershed in northern Japan. The results showed that the public strongly wish to avoid the extinction of endangered species in preference to climate-change mitigation in the form of carbon sequestration by increasing the area of managed forest. Knowledge of the site and the respondents’ awareness of the personal benefits associated with supporting and regulating services had a positive effect on their preference for conservation plans. Thus, decision-makers should be careful about how they provide ecological information for informed choices concerning ecosystem services tradeoffs. Suggesting targets with explicit indicators will affect public preferences, as well as the willingness of the public to pay for such measures. Furthermore, the elicited-choice probabilities approach is useful for revealing the distribution of relative preferences for incomplete scenarios, thus verifying the effectiveness of indicators introduced in the experiment.     

Medium-Term Money Neutrality and the Effective Lower Bound

Conventional wisdom suggests that medium-term money neutrality imposes strong limitations on the effects of monetary policy. The point of this paper is that models with medium- and long-term money neutrality are prone to generate nonexistence of equilibria at the effective lower bound (ELB) on interest rates. Nonexistence is suggestive of sharp output contractions—so-called contractionary black holes—at the ELB. Paradoxically, the case for expansionary monetary policy at the ELB is even stronger in models that feature near money neutrality. The results highlight the benefits of a monetary policy regime in which the central bank temporarily overshoots its inflation target once confronted by the ELB.     

Dynamic interaction of risk–return trade-offs between oil market and China’s stock market: An analysis from the risk preferences perspective

The risk–return trade-off refers to the compensation required by investors for bearing risks, which can be viewed as the risk preference of investors in a market. The current study investigates the dynamic interdependence of risk–return trade-offs between China’s stock market and the crude oil market from the perspective of risk preference of investors, which is designed to explore the transmission process of investors’ risk preference in both markets. Specifically, this study applies the time-varying parameter GARCH-M model, namely TVP-GARCH-M model, to characterize the time-dependent risk–return trade-offs (investors’ risk preferences) in the crude oil and China’s stock markets, then examines their relationship through Granger causality tests. Results show that a variation in risk preferences of the oil market investors can dramatically cause a variation in risk preferences of the Chinese stock market investors, while the risk preference of investors in the Chinese stock market does not lead to that in the crude oil market, which is in accordance with expectations. The dynamic effect of investors’ risk appetite in the crude oil market is further examined by the TVP-VAR model. The findings of this work suggest that there generally exists a positive impact of investors’ risk preference in the oil market and that the effect is time-varying to a greater degree during the short and medium term. Moreover, responses of the Chinese stock market investors’ risk preference were more significant during the 2008 financial crisis. Additionally, the empirical results remain robust when applying alternative crude oil prices and China’s stock prices.     

An applied stochastic model of the quality–quantity trade-off in the public health care sector

It is a striking feature of the many of the developing country public service sectors that the sectors in question often overproduce the quantity of services but underproduce the quality. This feature, which is exemplified in this paper, is rooted in a wide spectrum of economic and sociological factors ranging from the economic and sociological profile of the service receiving people to the asymmetric density of service-receiving population across their regions. This feature, we conjecture, is a source of a considerable degree of suboptimality in some of the developing countries. If our conjecture is correct, correcting such suboptimalities is likely to yield significant welfare improvements that could help speed up the process of development in the underdeveloped regions of the world. To analyze the supoopimalites in question, we will first develop a concept (and a model) of optimal quality in the public service sector, which indicates the level of quality that maximizes expected public satisfaction subject to available resources. Resources are used in an efficient manner to produce the service in question. The concept and the model in the paper make a needed contribution to the quality discourse by presenting a way of determining the quality improvements (or adjustments) necessary to achieve optimum in the public service sector. The paper presents an application (a case study) of this new concept in the public healthcare sector in Turkey, and explores the differences between the actual and optimal quality in the sector in question. It turns out that there is a considerable difference between the actual and optimal levels of quality (as well as those of quantity) in the Turkish public healthcare sector in an overpopulated city (Istanbul), indicating a significant overproduction of quantity and underproduction of quality. Thus, to achieve the optimal levels, the sector should increase quality and reduce quantity by a considerable margin. The quantified differences (gaps) between actual and optimal levels point out a considerable room for welfare improvement. Optimum-seeking adjustments closing these gaps could be shown to lead to considerable satisfaction and welfare gains, the measurement of which is worthy of future research.     

中国股市的风险与收益存在补尝关系吗？

Abstract Employing a recently developed method-mixed data sampling (MIDAS) approach — to assess the risk-return trade-off for Chinese stock markets, our results are striking. First, we fail to find any evidence of the risk-return trade-off in the first subsample (Jan 1993–Jan 2001), while we do find the existence of such relationship in the second subsample (Feb 2001–Dec 2005); such results suggest that as the markets become more mature, risks are compensated more properly. Second, we also compare the MIDAS results with the results obtained from conventional approaches such as the GARCH-type model. Our results are reasonably robust to the methods that we use, and the MIDAS and GARCH-type approaches outperform rolling-window approach in terms of modeling volatility.      

Differences in utility elicitation methods in cardiovascular disease: a systematic review

Aims: Utility values inform estimates of the cost-effectiveness of treatment for cardiovascular disease (CVD), but values can vary depending on the method used. The aim of this systematic literature review (SLR) was to explore how methods of elicitation impact utility values for CVD.

Materials and methods: This review identified English-language articles in Embase, MEDLINE, and the gray literature published between September 1992 and August 2015 using keywords for “utilities” and “stroke”, “heart failure”, “myocardial infarction”, or “angina”. Variability in utility values based on the method of elicitation, tariff, or type of respondent was then reported.

Results: This review screened 4,341 citations; 290 of these articles qualified for inclusion in the SLR because they reported utility values for one or more of the cardiovascular conditions of interest listed above. Of these 290, the 41 articles that provided head-to-head comparisons of utility methods for CVD were reviewed. In this sub-set, it was found that methodological differences contributed to variation in utility values. Direct methods often yielded higher scores than did indirect methods. Within direct methods, there were no clear trends in head-to-head studies (standard gamble [SG] vs time trade-off); but general population respondents often provided lower scores than did patients with the disease when evaluating the same health states with SG methods. When comparing indirect methods, the EQ-5D typically yielded higher values than the SF-6D, but also showed more sensitivity to differences in health states.

Conclusions: When selecting CVD utility values for an economic model, consideration of the utility elicitation method is important, as this review demonstrates that methodology of choice impacts utility values in CVD.     

石化建设项目工期与成本的均衡决策研究

石化建设项目工期与成本的矛盾冲突在我国石化工程建设实践中是十分常见的,这反映出二者均衡决策由于在理论研究上的缺失而导致的在实际决策中的非理性。为此,有必要从系统优化的角度出发通过对项目资源配置、工期、成本等相互间决定机理的探讨,确定项目工期与成本均衡决策的科学原理和相关决策模型,以指导实际管理决策过程,提高项目管理水平。     

Profit-fairness trade-off in project selection

Allocating the overall budget to projects is a major decision for an organization. Taking that decision by looking at the overall profit only may result in an unfair treatment of departments, with some departments overloaded and others underemployed (and dissatisfied). We consider an alternative approach, where the budget allocation is accomplished by aiming at fairness as well as profit. We adopt a knapsack-type Integer Linear Programming formulation to optimize both quality indicators of budget allocation, employing a fairly wide selection of fairness measures. The resulting optimization routines are applied to a representative selection of instances generated through Monte Carlo simulation. We show that high levels of fairness can be achieved for realistic scenarios with only a moderate loss of profit. Large companies appear to be able to achieve a better trade-off between fairness and profit. Striving for fairness also leads to funding more projects, thus increasing the usage level of the organization's human and material resources.