On the mean residual life of records

Suppose that a technical system is subject to shocks, e.g. peaks of voltages from a sequence of identically independent voltages having a lower limit value v>0$v>0$. We propose a new definition for the mean residual life of the records of the sequence and study its various properties.     

Adjusted estimates for time-to-event endpoints

In the analysis of retrospective data or when interpreting results from a single-arm phase II clinical trial relative to historical data, it is often of interest to show plots summarizing time-to-event outcomes comparing treatment groups. If the groups being compared are imbalanced with respect to factors known to influence outcome, these plots can be misleading and seemingly incompatible with results obtained from a regression model that accounts for these imbalances. We consider ways in which covariate information can be used to obtain adjusted curves for time-to-event outcomes. We first review a common model-based method and then suggest another model-based approach that is not as reliant on model assumptions. Finally, an approach that is partially model free is suggested. Each method is applied to an example from hematopoietic cell transplantation.     

Value of Information in Closed Loop Supply Chains

We explore the value of information (VOI) in the context of a firm that faces uncertainty with respect to demand, product return, and product recovery (yield). The operational decision of interest in matching supply with demand is the quantity of new product to order. Our objective is to evaluate the VOI from reducing one or more types of uncertainties, where value is measured by the reduction in total expected holding and shortage costs. We start with a single period model with normally distributed demands and returns, and restrict the analysis to the value of full information (VOFI) on one or more types of uncertainty. We develop estimators that are predictive of the value and sensitivity of (combinations of) different information types. We find that there is no dominance in value amongst the different types of information, and that there is an additional pay‐off from investing in more than one type. We then extend our analysis to the multi‐period case, where returns in a period are correlated with demands in the previous period, and study the value of partial information (VOPI) as well as full information. We demonstrate that our results from the single period model (adapted for VOPI) carry‐over exactly. Furthermore, a comparison with uniformly distributed demand and return show that these results are robust with respect to distributional assumptions.     

PRICING,PRODUCTION, AND PERSISTENCE

Though built with increasingly precise microfoundations, modern optimizing sticky price models have displayed a chronic inability to generate large and persistent real responses to monetary shocks, as recently stressed by Chari, Kehoe, and McGrattan (2000). We trace this lack of persistence to a standard view of the cyclical behavior of real marginal cost built into current sticky price macro models. Using a fully articulated general equilibrium model, we develop an alternative perspective on real marginal cost that leads to substantial persistence. Based on an important role for materials input, variable capacity utilization, and labor adjustment on the extensive margin, this alternative view also makes the sticky price model display volatility and comovement of factor inputs and factor prices more closely in line with conventional wisdom about business cycles and various empirical studies of the dynamic effects of monetary shocks. (JEL: E31 E32)     

On E‐Auctions for Procurement Operations

Electronic auctions have revolutionized procurement in the last decade. In many situations, they have replaced negotiations for supplier selection and price setting. While they have often greatly reduced transaction costs and increased competition, they have also encountered problems and resistance from suppliers resenting their intrusion on cooperative supplier/buyer relationships. In response to these issues, procurement auctions have evolved in radical new directions. Buyers use business rules to limit adverse changes. Some procurement auctions allow bidders to offer variants in the specifications of products to be supplied. Most important, some suppliers are allowing bidders to bid on packages of items, not just individual items. This tends to change procurement auctions from zero‐sum fights over supplier profit margins to win‐win searches for synergies. These changes have opened up many new research areas. Researchers are trying to improve how to deal with the computational issues involved in package auctions and to analyze the new auctions forms that are evolving. In general, equilibrium incentives are not known, and dealing with ties in package auctions is an issue. Computer scientists are analyzing the use of computerized bidding agents. Mechanisms that combine auctions with fixed buy prices or with negotiations need to be analyzed.     

Empowerment as a success factor in start-up companies

In this paper, we develop a theoretical model of employee empowerment in start-ups by integrating different management-oriented approaches in the literature. To test this model, we use recent survey data from start-up companies in high-growth industries based in Germany. In particular, we examine the degree to which employee empowerment as a modern concept of delegative leadership contributes to a higher organizational effectiveness within the firm and eventually to higher growth.

Reexamining economic sociology: Beyond rational choice reductionism

The article aims at reexamining the origins and character of economic sociology by comparison with rational choice within the history of economic and social ideas, particularly neoclassical economic and classical sociological theory. Some suggestions for a rational choice approach to economic sociology are particularly curious in that they tend to conflate the distinct characters and origins of these two disciplines throughout this history and have in turn provided an impetus for this reexamination. Modern rational choice theorists display a predilection for reducing economic (and, all) sociology into an economic approach to human behavior, with many economic sociologists evincing some degree of lenience or benevolence vis-à-vis such tendencies. Both tendencies do not seem justified in light of the different nature and origin of economic sociology and rational choice in the history of social and economic ideas. Since the current literature lacks coherent attempts at specifying the nature and historical roots of economic sociology versus those of rational choice, the article contributes toward filling in this hole.