Simple averaging of direct and recursive forecasts via partial pooling using machine learning

This article introduces the winning method at the M5 Accuracy competition. The presented method takes a simple manner of averaging the results of multiple base forecasting models that have been constructed via partial pooling of multi-level data. All base forecasting models of adopting direct or recursive multi-step forecasting methods are trained by the machine learning technique, LightGBM, from three different levels of data pools. At the competition, the simple averaging of the multiple direct and recursive forecasting models, called DRFAM, obtained the complementary effects between direct and recursive multi-step forecasting of the multi-level product sales to improve the accuracy and the robustness.     

Evolutionary stability of discrimination under observability

We study the evolution of preferences under perfect and almost perfect observability in symmetric 2-player games. We demonstrate that if nature can choose from a sufficiently general preference space, which includes preferences over outcomes that may depend on the opponent's preference-type, then, in most games, only discriminating preferences (treating different types of opponents differently in the same situation) can be evolutionary stable and some discriminating types are stable in a very strong sense in all games. We use these discriminating types to show that any symmetric outcome which gives players more than their minmax value in material payoffs (fitness) can be seen as equilibrium play of a player population with such strongly stable preferences.     

Differentiating ambiguity: an expository note

Ghirardato et al. J Econ Theory 118:133–173, 2004 propose a method for distinguishing between perceived ambiguity and the decision-maker’s reaction to it. They study a general class of preferences which they refer to as invariant biseparable. This class includes CEU and MEU. This note presents some examples which illustrate their results. Research supported by ESRC grant no. RES-000-22-0650. For comments and discussion we would like to thank Klaus Nehring and a seminar audience at ESEM, Vienna 2006.     

The objective of a privately owned firm under imperfect competition

This paper proposes a model of imperfect competition among privately owned firms that act in the best interest of their shareholders. The existence of a solution for the model is proved under weaker conditions than the ones generally used in the literature. In particular, the results did not require the existence of a continuous equilibrium price selection or concavity assumptions on the profit function.      

Voting on the environment: Price or ideology? Evidence from Swiss referendums

Studies on preferences for environmental quality usually posit that price and income explain most of the observed choices. Incorporating recent advances in the economics of non-selfish behavior into the traditional public choice approach, we argue that the willingness to contribute to public goods as well as social norms need to be taken into account when analyzing environmental voting outcomes. We study aggregate results of three ballot proposals in Switzerland put to vote in the year 2000 which foresaw different tax schemes on fossil energy. Our main results show that the aggregate level choice pattern is to be explained by income as well as structural attributes that make costs and benefits of the projects vary. More importantly, our results underline the importance of including variables pertaining to the notion of ideology, both in terms of statistical fit and obtaining unbiased estimates for price and income determinants.     

Job preferences of students and new graduates in nursing

This article investigates the preferences of student and newly graduated nurses for pecuniary and nonpecuniary aspects of nursing jobs. It is the first study applying methods based on discrete choice experiments to a developed country nursing workforce. It is also the first to focus on the transition through university training and into work. This is particularly important as junior nurses have the lowest retention levels in the profession. We sample 526 individuals from nursing programmes in two Australian universities. Flexible and newly developed models combining heteroscedasticity with unobserved heterogeneity in scale and preference weights are estimated. Overall, salary remains the most important feature in increasing the probability that a job will be selected. ‘Supportive management/staff’ and ‘quality of care’ follow as the most important attributes from a list of 11 nonpecuniary characteristics. However, the subset of new graduates rank ‘supportive management/staff’ above salary increases, emphasizing the importance of a supportive workplace in the transition from university to the workplace. We find substantial preference heterogeneity and some attributes, such as the opportunity for clinical rotations, are found to be attractive to some nurses while seen as negative by others. Nursing retention could be improved by designing different employment packages to appeal to these different tastes.     

Heterogeneous treatment effects and mechanisms in information-based environmental policies: Evidence from a large-scale field experiment

Policymakers often rely on non-pecuniary, information-based programs to achieve social objectives. Using data from a water conservation information campaign implemented as a randomized controlled trial, we estimate heterogeneous household responses. Understanding such heterogeneity is important for improving the cost-effectiveness of non-pecuniary programs, extending them to other populations and probing the mechanisms through which the treatment effects arise. We find little evidence of heterogeneous responses to purely technical information or to traditional conservation messages that combine technical information and moral suasion. In contrast, norm-based messages that combine technical information, moral suasion and social comparisons exhibit strong heterogeneity: households that are wealthier, owner-occupied and use more water are more responsive. These subgroups tend to be least responsive to pecuniary incentives. We find no evidence that any subgroup increases their water use in response to the messages. By targeting the messages to subgroups known to be most responsive, program costs could be reduced by over 50% with only a 20% reduction in the treatment effect. Combining theory and data, we also shed light on the mechanisms through which the treatment effects arise, which has implications for program design and future research on the program's welfare effects.     

On the determinants of household debt maturity choice

This article jointly analyses a behavioural and a cultural concept to explain household debt portfolio choice. The behavioural approach explores the role of time preferences on household debt maturity in a theoretical model and a numerical analysis. We derive a positive relationship between the long-term discount factor δ and the optimal maturity of household loans. The cultural approach examines whether national culture is a reasonable predictor for household debt maturity. We show that culture is an important factor for households’ borrowing decisions and has even more predictive power than time preferences. Countries with higher scores on the Hofstede dimension of long-term orientation tend to have shorter household debt maturity. Time preferences incur a primarily mediating role, because the effect of national culture on the borrowing decision is reduced, as the long-term discount factor δ increases.