Transfer of risk in the newsvendor model with discrete demand

In this paper we consider the transfer of risk in a newsvendor model with discrete demand. We view the newsvendor model as a leader/follower problem where the manufacturer (leader) decides the wholesale price and the retailer (follower) decides the quantity ordered. Taking a Pareto-optimal contract as a starting point, the manufacturer wishes to design a real option contract to enhance profits. A new real option contract is said to be feasible if both parties' expected profit is at least as great as in the original contract. When demand is discrete, there are usually infinite feasible contracts that yield maximum expected profits to the manufacturer. In the paper we show that either all, some or none of these real option contracts offer an improved position for the retailer.     

Will workfare work? Job availability for welfare recipients in rural and urban America

Ongoing concern over welfare dependency has stimulated the US Government to enact welfare reform legislation that features work requirements. Under the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, millions of able-bodied welfare recipients will now be expected to find work within two years. We analyze data from the March 1994 Current Population Survey to address the neglected question of whether a sufficient number of jobs will be available for those looking for work. Using two methods to estimate job availability, and a variety of assumptions about which welfare recipients will be required to work, we estimate that as few as 18 and as many as 54 welfare recipients and other unemployed individuals would be competing for each available job. Separate analyses by residence provided equivocal evidence on whether metropolitan or nonmetropolitan welfare recipients will have the more difficult time finding gainful employment.     

Slipping Into and Out of Underemployment: Another Disadvantage for Nonmetropolitan Workers?1

Abstract Underemployment, which goes beyond unemployment to include the working poor, discouraged workers, and involuntary part-time workers, is a useful measure of employment hardship. We argue that underemployment should be included with other conventional indicators of the disadvantaged circumstances of nonmetropolitan (nonmetro) labor, in terms not only of prevalence, but also of the likelihood of transitions into and out of underemployment. We take advantage of the quasi-longitudinal nature of the U.S. Current Population Surveys to estimate models of year-to-year employment transitions for the quarter century 1968 to 1993. We find that (1) adequately employed nonmetro workers are more likely than their more urban counterparts to become underemployed; (2) the nonmetro underemployed are less likely to become adequately employed; (3) statistical controls only strengthen these nonmetro disadvantages; (4) the employment transitions of nonmetro workers are less affected by shifts in the direction of the national economy than are those of metro workers; and (5) nonmetro women are more disadvantaged than women residing elsewhere.     

Effectiveness of the International Child Development Programme: Results from a randomized controlled trial

This study aimed to evaluate the effectiveness of the International Child Development Programme (ICDP), a group-based parenting programme used internationally and implemented nationally in Norway. We used a cluster randomized controlled trial in which 81 groups were randomly assigned to either the intervention or waitlist control condition after the baseline data collection. A total of 590 parents completed at least one of three questionnaires (administrated before and after ICDP and 4 months after completing the intervention). Primary outcomes included parental self-efficacy, parental emotion sensitivity and positive involvement with their child. Secondary outcomes included parents' perceptions of their relationship with the child, child-rearing conflicts and the child's psychosocial health. We found significant effects favouring the intervention arm following the intervention and at follow-up on two primary outcomes (parental self-efficacy and emotion sensitivity). For the secondary outcomes, we found a significant reduction in child-rearing conflict at the 4-month follow-up, increased closeness to the child, reduced child internalizing difficulties and increased prosocial behaviour immediately following the intervention. However, ICDP seems to have limited effects on parent-reported changes in children. We conclude that ICDP as a universal preventive programme offered to parents in groups can be effective in strengthening parental self-efficacy and improving parental emotion sensitivity.     

Income characteristics and the use of microfinance services: evidence from economically active persons with disabilities

The purpose of this empirical research from Uganda is to provide initial insight into the ‘black box’ of understanding the economic behaviour of persons with disabilities and about their use of microfinance services. First, we analyse the income levels of persons with disabilities in relation to their sources of income. Second, we study the income sources and income levels for different types of disabilities. Finally, we analyse how income level and income source relate to the use of microfinance services for persons with disabilities. We present evidence that farmers with disabilities and persons with visual impairments have lower income levels than other persons with disabilities. We then document that those with the lowest income levels have the least access to microfinance services, in particular services from formal institutions. Moreover, respondents involved in farming and manufacturing have less access to formal microfinance services than those involved in retail/wholesale or service activities.     

Race,Ethnicity, and Underemployment in Nonmetropolitan America: A 30‐Year Profile*

Abstract Historically, rural racial and ethnic minorities have been among the most economically disadvantaged groups in the United States. Key to understanding economic deprivation is employment hardship, trends in which serve as a benchmark for progress toward racial and ethnic equality. We conceptualize employment hardship as underemployment, which goes beyond unemployment to include discouraged workers, involuntary part‐time workers, and the working poor. Analyzing data from the March Current Population Surveys of 1968 through 1998, we find that (1) there are large and persistent racial and ethnic inequalities in underemployment prevalence; (2) these disadvantages are explained only partially by other predictors of underemployment; (3) nonmetropolitan (nonmetro) minorities are more likely than either all metropolitan (metro) or central‐city minorities to be underemployed; (4) black‐white inequality has held steady overall, though it has declined markedly in nonmetro areas; and (5) Hispanic‐white inequality has increased; this trend, however, is restricted to metro areas, central cities in particular.     

Sense of coherence during unemployment

The aim of this study was to investigate the relation between different forms of hardship during unemployment and the sense of coherence (SOC). These hardships were considered in the framework of the finances–shame model, which has been developed to help provide a greater understanding of why unemployment is so painful to some whilst others are hardly affected by it. The hypothesis in this study was that the greater the financial hardships during unemployment and the more a person has been subjected to shaming by others because they are unemployed, the lower his or her SOC will be, and vice versa. The empirical data were collected by means of a cross-sectional survey of 1,249 unemployed people in a region in southern Sweden who at the time of the survey were engaged in some form of labour-market training or workfare programme. The dropout rate was 23%. The results from the study lent strong support to the finances–shame model. Among those who were exposed to a greater degree of financial hardship and also had more shaming experiences, the mean SOC score was 42.14 for women and 42.41 for men. The corresponding figures for those facing a lesser degree of financial hardship and with fewer shaming experiences were 67.10 and 66.66 respectively, i.e. figures which are on a par with or somewhat higher than for population studies covering the whole population.     

Social Capital and Human Mortality: Explaining the Rural Paradox with County‐Level Mortality Data

The “rural paradox” refers to standardized mortality rates in rural areas that are unexpectedly low in view of well‐known economic and infrastructural disadvantages there. We explore this paradox by incorporating social capital, a promising explanatory factor that has seldom been incorporated into residential mortality research. We do so while being attentive to spatial dependence, a statistical problem often ignored in mortality research. Analyzing data for counties in the contiguous United States, we find that: (1) the rural paradox is confirmed with both metro‐nonmetro and rural‐urban continuum codes, (2) social capital significantly reduces the impacts of residence on mortality after controlling for race and ethnicity and socioeconomic covariates, (3) this attenuation is greater when a spatial perspective is imposed on the analysis, (4) social capital is negatively associated with mortality at the county level, and (5) spatial dependence is strongly in evidence. A spatial approach is necessary in county‐level analyses such as ours to yield unbiased estimates and optimal model fit.     

Reassessing and Revising Commuting Zones for 2010: History,Assessment, and Updates for U.S. ‘Labor-Sheds’ 1990–2010

This paper employs commuter flow data from the 1990 and 2000 Decennial Censuses, and the 2006–2010 American Community Survey to replicate, evaluate, and extend the delineation of commuting zones first proposed by Tolbert and Killian (Labor Market Areas for the United States, 1987). Commuting zones offer a valuable tool for research on regional economies and have long served rural sociologists, economists, and geographers interested in a representation of the economy that acknowledges a connection between urban and rural areas and the capacity of economic systems to cross state lines. Our delineations provide both an update in the form of new delineations for 2010 and a revised set of 1990 and 2000 delineations that benefit from a consistent methodology across decades. We also provide a set of tools for comparing delineations across methods and over time. In presenting our revised delineations, we shed light on the role of expert opinion in the original delineations, the strengths and weaknesses of the original method, and offer suggestions for further revision of this tool that may better reflect the theoretical conception of commuting zones.     

Are nurses more altruistic than real estate brokers?

We report results from a dictator game experiment with nurse students and real estate broker students as dictators, and Amnesty International as the recipient. Although brokers contributed substantial amounts, nurses contributed significantly more, on average 76% of their endowment. In a second part, subjects chose between a certain repetition of the experiment and a 50-50 chance of costly exit. About one third of the brokers and half of the nurses chose the exit option. While generosity was indeed higher among nurses, even when taking exits into account, the difference cannot readily be attributed to different degrees of altruism.