Is Probability the Only Coherent Approach to Uncertainty?

In this article, I discuss an argument that purports to prove that probability theory is the only sensible means of dealing with uncertainty. I show that this argument can succeed only if some rather controversial assumptions about the nature of uncertainty are accepted. I discuss these assumptions and provide reasons for rejecting them. I also present examples of what I take to be non-probabilistic uncertainty.     

Teamworking and organizational performance: A review of survey‐based research

This paper presents a review of recent survey‐based research looking at the contribution of teamwork to organizational performance. In particular, it focuses on empirical studies in which both teamwork and performance are directly measured in a quantitative way. The paper begins by identifying four interrelated dimensions of teamwork effectiveness: attitudinal, behavioural, operational and financial. The first two represent transmission mechanisms by which organizational performance can be improved. The latter two provide direct measures of organizational outcomes. The review shows that teamworking has a positive impact on all four dimensions of performance. It also reveals that, when teamwork is combined with structural change, performance can be further enhanced. The paper concludes by highlighting some important research gaps that future studies could address.     

Age discrimination and working life: Perspectives and contestations – a review of the contemporary literature

This review highlights some of the principal issues and debates surrounding age discrimination at the workplace. Essentially, the existing research in this area can be divided into three broad, although somewhat overlapping, categories. The first explores the underlying causes and consequences of age discrimination at the workplace from one or other theoretical tradition. The second broad body of literature encompasses empirical studies which document the nature and extent of age discrimination, based on the use of official statistics, and/or firm‐level survey evidence. The third explores the effects of various governmental initiatives to reduce the incidence of age discrimination and policy options in this area. Even though age discrimination is widely accepted to be prevalent, its causes are rather more contentious. Age discrimination has variously been ascribed to market imperfections, the product of rational choices and the effects of long‐term changes in the nature of the economy. Policy interventions may be prompted by economic pressure, demographic changes or cultural shifts, and have involved voluntary codes as well as legislation. Although voluntary codes have generally proved ineffective, the literature indicates that more formal regulations may still have only limited efficacy, underscoring the deeply rooted nature of age discrimination in society.     

Stochastic Spanning

ABSTRACT

This study develops and implements methods for determining whether introducing new securities or relaxing investment constraints improves the investment opportunity set for all risk averse investors. We develop a test procedure for “stochastic spanning” for two nested portfolio sets based on subsampling and linear programming. The test is statistically consistent and asymptotically exact for a class of weakly dependent processes. A Monte Carlo simulation experiment shows good statistical size and power properties in finite samples of realistic dimensions. In an application to standard datasets of historical stock market returns, we accept market portfolio efficiency but reject two-fund separation, which suggests an important role for higher-order moment risk in portfolio theory and asset pricing. Supplementary materials for this article are available online.     

Direct and Indirect Effects Based on Difference-in-Differences With an Application to Political Preferences Following the Vietnam Draft Lottery

Abstract

We propose a difference-in-differences approach for disentangling a total treatment effect within specific subpopulations into a direct effect and an indirect effect operating through a binary mediating variable. Random treatment assignment along with specific common trend and effect homogeneity assumptions identify the direct effects on the always and never takers, whose mediator is not affected by the treatment, as well as the direct and indirect effects on the compliers, whose mediator reacts to the treatment. In our empirical application, we analyze the impact of the Vietnam draft lottery on political preferences. The results suggest that a high draft risk due to the draft lottery outcome leads to an increase in mild preferences for the Republican Party, but has no effect on strong preferences for either party or on specific political attitudes. The increase in Republican support is mostly driven by the direct effect not operating through the mediator that is military service.     

Geodesic Monte Carlo on Embedded Manifolds

Markov chain Monte Carlo methods explicitly defined on the manifold of probability distributions have recently been established. These methods are constructed from diffusions across the manifold and the solution of the equations describing geodesic flows in the Hamilton–Jacobi representation. This paper takes the differential geometric basis of Markov chain Monte Carlo further by considering methods to simulate from probability distributions that themselves are defined on a manifold, with common examples being classes of distributions describing directional statistics. Proposal mechanisms are developed based on the geodesic flows over the manifolds of support for the distributions, and illustrative examples are provided for the hypersphere and Stiefel manifold of orthonormal matrices.     

On Tests Based on Sample Quasi Ranges for Ordered Alternative (Scale Case of Exponential Distribution)

The analysis of categorical response data through the multinomial model is very frequent in many statistical, econometric, and biometric applications. However, one of the main problems is the precise estimation of the model parameters when the number of observations is very low. We propose a new Bayesian estimation approach where the prior distribution is constructed through the transformation of the multivariate beta of Olkin and Liu (2003 Olkin , I. , Liu , R. ( 2003 ). A bivariate beta distribution . Stat. Probab. Lett. 62 : 407 – 412 .[Crossref], [Web of Science ®] , [Google Scholar]). Moreover, the application of the zero-variance principle allows us to estimate moments in Monte Carlo simulations with a dramatic reduction of their variances. We show the advantages of our approach through applications to some toy examples, where we get efficient parameter estimates.     

Simulating Controlled Variate and Rank Correlations Based on the Power Method Transformation

The power method transformation is a popular algorithm used for simulating correlated non normal continuous variates because of its simplicity and ease of execution. Statistical models may consist of continuous and (or) ranked variates. In view of this, the methodology is derived for simulating controlled correlation structures between non normal (a) variates, (b) ranks, and (c) variates with ranks in the context of the power method. The correlation structure between variate-values and their associated rank-order is also derived for the power method. As such, a measure of the potential loss of information is provided when ranks are used in place of variate-values. The results of a Monte Carlo simulation are provided to confirm and demonstrate the methodology.     

The Effects and Effectiveness of Using Torture as an Interrogation Device: Using Research to Inform the Policy Debate

Governments sometimes characterize torture as an indispensable interrogation tool for gathering strategic intelligence. In this article, we review the relevant social scientific research on the effectiveness, impact, and causes of torture. First, we summarize research on false confessions and examine the relevance of that research for torture-based interrogations. Next, we review research on the mental health consequences of torture for survivors and perpetrators. Finally, we explore the social-psychological conditions that promote acts of cruelty (such as those seen at Abu Ghraib) and examine the arguments typically offered to justify the use of torture. We argue that any hypothesized benefits from the use of torture must be weighed against the substantial proven costs of torture. These costs include the unreliable information extracted through interrogations using torture, the mental and emotional toll on victims and torturers, loss of international stature and credibility, and the risk of retaliation against soldiers and civilians.     

Same‐Sex Marriage and Negative Externalities*

Objectives. Conventional theory regarding externalities and personal choices implies that in the absence of negative externalities, there is no economic rationale for government to regulate or ban those choices. We evaluate whether legally recognizing (or prohibiting) same‐sex marriage has any adverse impact on societal outcomes specifically related to “traditional family values.” Methods. Using data from 1990 to 2004 in the U.S. states, with statistical controls appropriate for the particular model, and with fixed effects, we test the claim of the Family Research Council that same‐sex marriage will have negative impacts on marriage, divorce, abortion rates, the proportion of children born to single women, and the percent of children in female‐headed households. Results. We find no statistically significant adverse effect from allowing gay marriage. Bans on gay marriage, when they are not overturned, appear to be associated with a lower abortion rate and a lower percentage of children in female‐headed households. However, allowing gay marriage also shows the same or stronger associations. Conclusions. The argument that same‐sex marriage poses a negative externality on society cannot be rationally held. Although many might believe that this conclusion is so obvious that it does not warrant testing, many politicians use this argument as a fact‐based rationale to legitimize bans on same‐sex marriage.