OR/MS methodology—A conceptual framework

Many authors deal, explicitly or implicitly, with OR/MS methodology and the term ‘methodology’ has gained such an inclusive connotation that it comes to denote nothing in particular. This has diluted the analytical precision of OR/MS ‘methodology’ as well as its practicability. Therefore an attempt to form a conceptual framework for OR/MS methodology will be presented. This framework consists of seven components addressing specific methodological aspects: each component has specific properties which distinguish it from the others; all of them together form a consistent hierarchy suitable to aid the successful development and implementation of OR/MS methods.     

“Economic Theory’s Stance On No-Fault Divorce”

This article explores key insights that economic theory can shed on the issue of no-fault divorce in the United States, addressing modifications in the incentive structure of individuals that resulted from the legislative reforms of the 1970s. After stressing the importance of correctly interpreting and classifying divorce laws, this work investigates the contributions of the theory of property rights, the contributions of game theory and intra-household bargaining, and the contributions of general equilibrium analysis in our understanding of how divorce laws work and what their impact is. By doing so, this exposé analyzes the theoretical consequences of no-fault divorce on the decision whether to get married or divorced, on the characteristics of spouses and divorcees, on divorce rates, and on marital-specific and non marital-specific investments.     

Mitochondrial Dynamics in Cell Life and Death

Mitochondria are dynamic organelles that are able to change their morphology during cellular development and to meet the energetic needs of the cell, for example. During the past several years, knowledge about the molecular machinery involved in the control of mitochondrial shape has improved considerably. In August 2005, leading researchers in the field of mitochondrial dynamics met at the Venetian Institute of Molecular Medicine in Padova, Italy, to discuss novel and intriguing findings presented at the first workshop on "Mitochondrial Dynamics in Cell Life and Death." Some of the findings related to apoptosis and aging are described in this Perspective.     

Pooling operators with the marginalization property

In this paper, we consider the problem of combining a number of opinions which have been expressed as probability measures P₁, …, P_n, over some space. It is shown that a pooling formula which has the marginalization property of McConway (1981) must be of the form T = Σⁿ_i=₁W_i P_i + (1 - Σⁿ_i =₁W_i)Q, where Q is an arbitrary measure and W₁, …, W_n ϵ [—1,1] are weights such that| Σ_J Σ _j w_j | ≤ 1 for every subset J of {1, …, n}. If, in addition, T is required to preserve the independence of arbitrary events A and B whenever these events are independent under each P_i, then either T = P_i for some 1 ≤ i ≤ n or T = Q, in which case Q takes values in {0, l}.     

Time series analysis of stratospheric ozone

Time series analyses of monthly average total ozone measured at 37 stations throughout the world were used to estimate the extent to which the average ozone trend correlates with the depletion curve hypothesized as due to chlorofluorocarbons (CFCs). Statistical characteristics of stations in the ensemble were used to help define appropriate model and station selection criteria. The maximum likelihood procedure developed herein estimates the weighted average trend, its. variance, and the intra- and inter-station variance components of the trend. Correlations among trends at different stations are also taken into account. The models were subjected to much checking and criticism. Variations in statistical methodology are used to show that the results are insensitive to details of the model selection criteria. The method does not discriminate well between the hypothesized CFC trend and a linear trend. The trend estimates represent the sum of all long-term global effects. The variance includes all effects that differ from station-to-station. The estimated trend and 2α limits for 14 stations with 20-year records (1958-79) is an ozone increase through 1979 of (1.5+1.0) percent. At the 23 stations with shorter records, the trend is (1.0=1.7) percent. It is concluded that no significant depletion in stratospheric ozone has occurred from any cause through the end of 1979.     

The two-sample t test versus satterthwaite's approximate f test

A comparison between the two-sample t test and Satterthwaite's approximate F test is made, assuming the choice between these two tests is based on a preliminary test on the variances. Exact formulas for the sizes and powers of the tests are derived. Sizes and powers are then calculated and compared for several situations.     

The Volatility of Realized Volatility

In recent years, with the availability of high-frequency financial market data modeling realized volatility has become a new and innovative research direction. The construction of “observable” or realized volatility series from intra-day transaction data and the use of standard time-series techniques has lead to promising strategies for modeling and predicting (daily) volatility. In this article, we show that the residuals of commonly used time-series models for realized volatility and logarithmic realized variance exhibit non-Gaussianity and volatility clustering. We propose extensions to explicitly account for these properties and assess their relevance for modeling and forecasting realized volatility. In an empirical application for S&P 500 index futures we show that allowing for time-varying volatility of realized volatility and logarithmic realized variance substantially improves the fit as well as predictive performance. Furthermore, the distributional assumption for residuals plays a crucial role in density forecasting.