On the correlation between fraud and default risk

Identity fraud is one of the fastest growing white-collar crimes today and a serious concern in our information-based economy. This paper studies one type of identity fraud: new account fraud, where an impostor opens lines of credit using a false identity, made-up or stolen. Relying on a unique data set of consumer bank accounts, that contains information on both, fraud and default losses, I analyze the correlation between fraud and default risk. I find that common socio-economic/demographic account holder characteristics have opposite effects on estimated default and fraud probabilities. For example, women possess a lower fraud probability, but a higher default probability, compared to men, and foreigners are more likely to engage in account fraud but less likely to default than Germans. Also, the portfolio level analysis indicates that portfolio loss distributions are quite sensitive to ex ante portfolio characteristics like the share of foreigners or blue-collar workers. These findings have important implications for banks managing their consumer credit portfolios using limiting rules based on borrower characteristics, and for the adequacy of banks’ capital levels.     

Using Frontier Analysis to Evaluate Company Performance

The measurement of performance is critical to nearly all managerial disciplines. Yet little is known about the aggregation characteristics of the components of performance and how our notion of a ‘good performing firm’ relates to what we use as a dependent variable. In this paper we propose an approach to the measurement of performance that uses the logic of frontier analysis and the technique of data envelopment analysis. The approach is shown to be a reasonable representation of the multidimensional nature of performance and is shown to replicate, effectively, the components that strategic management scholars typically consider when discussing performance. It is also shown to be superior to the simpler alternatives based on traditional approaches to performance measurement.     

Ignorance Isn't Bliss: Complaint Experience and Organizational Learning in the California Nursing Home Industry, 1997–2004

Organizational learning theory suggests that complaints about products and services can promote organizational learning and change. However, evidence suggests that potentially valuable forms of experience may be ignored or discounted in organizations, and additional research is needed to determine why this happens. This study contributes to those efforts by examining how multiple forms of complaint experience interactively influence organizational outcomes. An empirical test on a longitudinal panel of Californian nursing homes finds that complaints about other issues may distract attention away from complaints about a focal issue, but only when complaints are provided anonymously. These findings forward organizational learning theories by suggesting that multiple types of experience may detract from rather than supplement each other in some cases. Additional implications and opportunities for further research are also discussed.     

The Determinants of Retail Productivity: A Critical Review of the Evidence

This paper discusses the literature on the established determinants of productivity in the retail sector. It also draws attention to some neglected strands of research which provide useful insights into strategies that could allow productivity enhancements in this area of the economy. To date, very few attempts have been made to integrate different specialisms in order to explain what drives productivity in retail. Here this paper rectifies this omission by putting together studies from economics, geography, knowledge management and employment studies. It is the authors’ view that quantitative studies of retail productivity should focus on total factor productivity in retailing as the result of competition/composition effects, planning regulations, information and communications technology, the multinational operation element and workforce skills. Further, the fact that retail firms possess advantages that are transferable between locations suggests that investment in strategies enhancing the transfer of explicit and tacit knowledge between and within businesses are crucial to achieve productivity gains.     

Taking Stock of Temporary Organizational Forms: A Systematic Review and Research Agenda

This paper brings together the research on temporary organizational forms. Despite a recent surge in publications on this topic, there have been few attempts to integrate knowledge on what we know of such temporary forms of organization. In order to correct this, an integrative framework is proposed around four central themes: time, team, task and context. Within each of these themes, the paper offers an overview of the literature, the gaps in what we know, and what future directions might be taken by scholars hoping to contribute to this important and rapidly growing field.     

Morality and Nuclear Energy: Perceptions of Risks and Benefits,Personal Norms,and Willingness to Take Action Related to Nuclear Energy

We examined factors underlying people's willingness to take action in favor of or against nuclear energy from a moral perspective. We conducted a questionnaire study among a sample of the Dutch population (N = 123). As expected, perceptions of risks and benefits were related to personal norms (PN), that is, feelings of moral obligation toward taking action in favor of or against nuclear energy. In turn, PN predicted willingness to take action. Furthermore, PN mediated the relationships between perceptions of risk and benefits and willingness to take action. In line with our hypothesis, beliefs about the risks and benefits of nuclear energy were less powerful in explaining PN for supporters compared to PN of opponents. Also, beliefs on risks and benefits and PN explained significantly more variance in willingness to take action of opponents than of supporters. Our results suggest that a moral framework is useful to explain willingness to take action in favor of and against nuclear energy, and that people are more likely to protest in favor of or against nuclear energy when PN are strong.     

Analyzing Evacuation Versus Shelter‐in‐Place Strategies After a Terrorist Nuclear Detonation

We superimpose a radiation fallout model onto a traffic flow model to assess the evacuation versus shelter‐in‐place decisions after the daytime ground‐level detonation of a 10‐kt improvised nuclear device in Washington, DC. In our model, ≈80k people are killed by the prompt effects of blast, burn, and radiation. Of the ≈360k survivors without access to a vehicle, 42.6k would die if they immediately self‐evacuated on foot. Sheltering above ground would save several thousand of these lives and sheltering in a basement (or near the middle of a large building) would save of them. Among survivors of the prompt effects with access to a vehicle, the number of deaths depends on the fraction of people who shelter in a basement rather than self‐evacuate in their vehicle: 23.1k people die if 90% shelter in a basement and 54.6k die if 10% shelter. Sheltering above ground saves approximately half as many lives as sheltering in a basement. The details related to delayed (i.e., organized) evacuation, search and rescue, decontamination, and situational awareness (via, e.g., telecommunications) have very little impact on the number of casualties. Although antibiotics and transfusion support have the potential to save ≈10k lives (and the number of lives saved from medical care increases with the fraction of people who shelter in basements), the logistical challenge appears to be well beyond current response capabilities. Taken together, our results suggest that the government should initiate an aggressive outreach program to educate citizens and the private sector about the importance of sheltering in place in a basement for at least 12 hours after a terrorist nuclear detonation.     

Informed Public Preferences for Electricity Portfolios with CCS and Other Low‐Carbon Technologies

Public perceptions of carbon capture and sequestration (CCS) and other low‐carbon electricity‐generating technologies may affect the feasibility of their widespread deployment. We asked a diverse sample of 60 participants recruited from community groups in Pittsburgh, Pennsylvania to rank 10 technologies (e.g., coal with CCS, natural gas, nuclear, various renewables, and energy efficiency), and seven realistic low‐carbon portfolios composed of these technologies, after receiving comprehensive and carefully balanced materials that explained the costs and benefits of each technology. Rankings were obtained in small group settings as well as individually before and after the group discussions. The ranking exercise asked participants to assume that the U.S. Congress had mandated a reduction in carbon dioxide emissions from power plants to be built in the future. Overall, rankings suggest that participants favored energy efficiency, followed by nuclear power, integrated gasification combined‐cycle coal with CCS and wind. The most preferred portfolio also included these technologies. We find that these informed members of the general public preferred diverse portfolios that contained CCS and nuclear over alternatives once they fully understood the benefits, cost, and limitations of each. The materials and approach developed for this study may also have value in educating members of the general public about the challenges of achieving a low‐carbon energy future.     

Now What Do People Know About Global Climate Change? Survey Studies of Educated Laypeople

In 1992, a mental‐models‐based survey in Pittsburgh, Pennsylvania, revealed that educated laypeople often conflated global climate change and stratospheric ozone depletion, and appeared relatively unaware of the role of anthropogenic carbon dioxide emissions in global warming. This study compares those survey results with 2009 data from a sample of similarly well‐educated laypeople responding to the same survey instrument. Not surprisingly, following a decade of explosive attention to climate change in politics and in the mainstream media, survey respondents in 2009 showed higher awareness and comprehension of some climate change causes. Most notably, unlike those in 1992, 2009 respondents rarely mentioned ozone depletion as a cause of global warming. They were also far more likely to correctly volunteer energy use as a major cause of climate change; many in 2009 also cited natural processes and historical climatic cycles as key causes. When asked how to address the problem of climate change, while respondents in 1992 were unable to differentiate between general “good environmental practices” and actions specific to addressing climate change, respondents in 2009 have begun to appreciate the differences. Despite this, many individuals in 2009 still had incorrect beliefs about climate change, and still did not appear to fully appreciate key facts such as that global warming is primarily due to increased concentrations of carbon dioxide in the atmosphere, and the single most important source of this carbon dioxide is the combustion of fossil fuels.     

An Empirical Model of Perceived Mortality Risks for Selected U.S. Arsenic Hot Spots

Researchers have long recognized that subjective perceptions of risk are better predictors of choices over risky outcomes than science‐based or experts’ assessments of risk. More recent work suggests that uncertainty about risks also plays a role in predicting choices and behavior. In this article, we develop and estimate a formal model for an individual's perceived health risks associated with arsenic contamination of his or her drinking water. The modeling approach treats risk as a random variable, with an estimable probability distribution whose variance reflects uncertainty. The model we estimate uses data collected from a survey given to a sample of people living in arsenic‐prone areas in the United States. The findings from this article support the fact that scientific information is essential to explaining the mortality rate perceived by the individuals, but uncertainty about the probability remains significant.