Covid-19 attacks the body of purchasing and supply management: A medical check of the immune system

Much like the immune system of the body, the ‘immune system’ of purchasing and supply management (PSM) is also affected by the Covid-19 virus. Medicine must hinder the spread of the virus and outbreak of disease, just as PSM must prevent risk events and handle supply disruptions. The existing debate on supply resilience and robustness can be demonstrated using this medical analogy. The purpose of this article was to perform a medical check of the ‘PSM immune system’ to identify lessons and research gaps when confronted with a low-frequency-high-impact event such as the pandemic. As a provocative note, this article identifies research gaps in elements of the immune system of PSM (e.g., helper cells – consultancy support or memory cells – feedback loops). The results call for a more holistic debate on the immune system of PSM. Two approaches for research on ‘conventional’ or ‘alternative’ risk management schools of thought are presented as a basis for future discourse on how to improve the PSM immune system.     

The new middle class in emerging markets: How values and demographics influence discretionary consumption

The rise of new middle‐class consumers in rapidly transforming emerging markets has attracted the attention of Western business executives. What they know about this growing segment of customers will determine whether they succeed or fail in these markets. The present study examines the factors that drive the discretionary consumption of this new middle class, including the effects of consumerist values, religious values, occupation, education levels, and ownership of fixed assets. The study draws its insights from data gathered from 391 new middle‐class consumers in Ankara, the second‐largest city in Turkey. The findings provide important implications for businesses, both indigenous and foreign. An overall implication is that managers ought to understand and qualify the new middle class in emerging markets not simply by their access to disposable income but by deeper attitudinal and behavioral characteristics.     

Determining analogies based on the integration of multiple information sources

Forecasting approaches that exploit analogies require the grouping of analogous time series as the first modeling step; however, there has been limited research regarding the suitability of different segmentation approaches. We argue that an appropriate analytical segmentation stage should integrate and trade off different available information sources. In particular, it should consider the actual time series patterns, in addition to the variables that characterize the drivers behind the patterns observed. The simultaneous consideration of both information sources, without prior assumptions regarding the relative importance of each, leads to a multicriteria formulation of the segmentation stage. Here, we demonstrate the impact of such an adjustment to segmentation on the final forecasting accuracy of the cross-sectional multi-state Kalman filter. In particular, we study the relative merits of single and multicriteria segmentation stages for a simulated data set with a range of noise levels. We find that a multicriteria approach consistently achieves a more reliable recovery of the original clusters, and this feeds forward to an improved forecasting accuracy across short forecasting horizons. We then use a US data set on income tax liabilities to verify that this result generalizes to a real-world setting.     

The visual history of the Tableau Économique

This article looks at the history of the Tableau Économique from a visual point of view. It shows that Quesnay invented the Tableau to formalize visually his economic theory, and that he used different versions of the Tableau (‘Zigzag’, ‘Précis’ and ‘Formule’) for reasons of visual rhetorics. Accordingly, the visual history of the Tableau clarifies several problems identified by previous ‘ecommentors’. The paper concludes that the history of the Tableau as an image cannot be equated with that of Quesnay's abstract economic model without missing the Tableau Économique's raison d'être.     

Revisiting games of incomplete information with analogy-based expectations

This paper studies the effects of analogy-based expectations in static two-player games of incomplete information. Players are assumed to be boundedly rational in the way they forecast their opponent's state-contingent strategy: they bundle states into analogy classes and play best-responses to their opponent's average strategy in those analogy classes. We provide general properties of analogy-based expectation equilibria and apply the model to a variety of well known games. We characterize conditions on the analogy partitions for successful coordination in coordination games under incomplete information [Rubinstein, A., 1989. The electronic mail game: Strategic behavior under ‘almost common knowledge’. Amer. Econ. Rev. 79, 385–391], we show how analogy grouping of the receiver may facilitate information transmission in Crawford and Sobel's cheap talk games [Crawford, V.P., Sobel, J., 1982. Strategic information transmission. Econometrica 50, 1431–1451], and we show how analogy grouping may give rise to betting in zero-sum betting games such as those studied to illustrate the no trade theorem.     

"冰山理论"与《老人与海》

海明威认为好的作品应如冰山，有藏有露，有虚有实。通过对其代表作《老人与海》的时代背景、创作意图、艺术形态、艺术手法的分析，进一步阐释了这一重要的创作理念。     

The impact of reduced pre-trade transparency regimes on market quality

This paper studies the effects of pre-trade quote transparency on spread, price discovery and liquidity in an artificial limit order market with heterogeneous trading rules. Our agent-based numerical experiments suggest that full quote transparency incurs substantial transaction costs to traders and dampens trading activity in an order-driven market. Our finding reveals that exogenous restriction of displayed depth, up to several best quotes, does not benefit market performance. On the contrary, endogenous restriction of displayed quote depth, by means of iceberg orders, improves market quality in multiple dimensions: it reduces average transaction costs, maintains higher liquidity and moderate volatility, balances the limit order book, and enhances price discovery.     

Moving beyond the iceberg model: The role of trade relations in endogenizing transportation costs in computable general equilibrium models

Modeling trade and transportation costs is an essential part of multiregional or spatial computable general equilibrium models where interregional trade plays an important rolein shaping economic activity. The majority of such models use the iceberg trade cost approach where part of the produced output (representing the material costs of transportation) is assumed to melt away during transportation. There are a few models which employ a more refined approach with an explicit transportation sector providing transportation services which are then used to ship goods between locations. In this paper we show that this approach, although much more convenient than the iceberg approach, still lacks full usability due to the fact that markets, hence prices are defined at the regional level and as a result, transportation costs can not be endogenous at the trade relation level. Moreover, under regional level market clearing the iceberg and the more detailed approach are equivalent. We propose to refine the definition of market equilibrium and move it to the trade relation level. Using this approach we can gain full advantage of the explicit transport sector in the model with respect to trade cost evolution. We show through simulations that refining the way trade costs are modelled indeed gains new insights, and that moving the market definition to the trade relational level leads to qualitative changes in the effect of labor supply shocks on main model variables. The paper also presents a method to estimate a SAM by reallocating data from standard industries to a transportation sector which is then consistent with the model setup. This SAM can be used to calibrate the refined model with a detailed transportation sector.     

The partially cursed and the analogy-based expectation equilibrium

Recent literature has established a link between the fully cursed equilibrium and the analogy-based expectation equilibrium. In this note, even the partially cursed equilibrium is shown to correspond to an analogy-based expectation equilibrium.     

产业集聚与经济增长:一个含有移民和中间产品革新的模型

本文建立模型用以论证产业集聚与经济增长的正向关系以及产业集聚的福利效应。模型含有Krugman（1991）型劳动流动性、Venables（1996）式垂直联系以及Romer（1990）型内生增长。经济增长与产业集聚相互加强的机制在于：熟练工人的集聚会提高集聚地R＆D部门的生产率（因熟练工人之间存在知识外部效应）因而提高增长率、提高该地熟练工人的工资以及该地的总支出。于是制成品的生产移往该地（靠近大市场可以节约较多运输成本）。同样的原因,中间产品的生产也移过来。这就导致了生产活动的集中;反过来,生产活动集聚会降低集聚地制成品的价格（因节省了较多的运输成本）从而导致向前看的熟练工人移过来,于是导致R＆D活动的集中从而提高增长率。福利分析表明：集聚加剧了周边与中心的差距;集聚改善了中心的福利．但未必以牺牲周边为代价。