INCENTIVE DESIGN UNDER LOSS AVERSION

Compensation schemes often reward success but do not penalize failure. Fixed salaries with stock options or bonuses have this feature. Yet the standard principal‐agent model implies that pay is normally monotonically increasing in performance. This paper shows that, under loss aversion, there will be intervals over which pay is insensitive to performance, with the use of carrots but not sticks frequently optimal, especially when risk aversion is low and reference income is endogenous. A further benefit of capping losses, for example through options, is to discourage reckless behavior by executives seeking to resurrect their fortunes. (JEL: F3, F4)     

Operations research in the management of the airlines

This paper is intended to present an introduction to the use of operations research in the international airline industry, and to demonstrate the scope and significance of the airline OR activities. First, the special reasons for the viability and spread of airline OR are discussed. Then a functional framework for an airline is outlined, to be used in analyzing the problems of an airline and relating the OR work to it. Four major applications are described, corresponding to four major components of the framework. These applications are: schedule development, overbooking control, crew scheduling and engine management, respectively. In each case we describe the problem and its significance, indicate the types of solution techniques which have been developed, and assess the implemented solutions. The paper concludes with comments on the current state-of-the-art and the future of airline OR. A detailed bibliography is given.Both of the authors have been operations research directors in major airlines and more recently have focused their attention upon the industry as academic researchers. This background has provided us with an unusual opportunity to analyze the role of OR in the airlines, and our paper seeks to share with the reader some of the insights we have gained thereby.     

Estimation in nonlinear mixed-effects models using heavy-tailed distributions

Nonlinear mixed-effects models are very useful to analyze repeated measures data and are used in a variety of applications. Normal distributions for random effects and residual errors are usually assumed, but such assumptions make inferences vulnerable to the presence of outliers. In this work, we introduce an extension of a normal nonlinear mixed-effects model considering a subclass of elliptical contoured distributions for both random effects and residual errors. This elliptical subclass, the scale mixtures of normal (SMN) distributions, includes heavy-tailed multivariate distributions, such as Student-t, the contaminated normal and slash, among others, and represents an interesting alternative to outliers accommodation maintaining the elegance and simplicity of the maximum likelihood theory. We propose an exact estimation procedure to obtain the maximum likelihood estimates of the fixed-effects and variance components, using a stochastic approximation of the EM algorithm. We compare the performance of the normal and the SMN models with two real data sets.     

A parameter expansion version of the SAEM algorithm

The EM algorithm and its extensions are very popular tools for maximum likelihood estimation in incomplete data setting. However, one of the limitations of these methods is their slow convergence. The PX-EM (parameter-expanded EM) algorithm was proposed by Liu, Rubin and Wu to make EM much faster. On the other hand, stochastic versions of EM are powerful alternatives of EM when the E-step is untractable in a closed form. In this paper we propose the PX-SAEM which is a parameter expansion version of the so-called SAEM (Stochastic Approximation version of EM). PX-SAEM is shown to accelerate SAEM and improve convergence toward the maximum likelihood estimate in a parametric framework. Numerical examples illustrate the behavior of PX-SAEM in linear and nonlinear mixed effects models.     

A Systematic Approach to Determining the Identifiability of Multistage Carcinogenesis Models

Multistage clonal expansion (MSCE) models of carcinogenesis are continuous‐time Markov process models often used to relate cancer incidence to biological mechanism. Identifiability analysis determines what model parameter combinations can, theoretically, be estimated from given data. We use a systematic approach, based on differential algebra methods traditionally used for deterministic ordinary differential equation (ODE) models, to determine identifiable combinations for a generalized subclass of MSCE models with any number of preinitation stages and one clonal expansion. Additionally, we determine the identifiable combinations of the generalized MSCE model with up to four clonal expansion stages, and conjecture the results for any number of clonal expansion stages. The results improve upon previous work in a number of ways and provide a framework to find the identifiable combinations for further variations on the MSCE models. Finally, our approach, which takes advantage of the Kolmogorov backward equations for the probability generating functions of the Markov process, demonstrates that identifiability methods used in engineering and mathematics for systems of ODEs can be applied to continuous‐time Markov processes.     

股东参与治理的私人收益和社会收益的实证研究

本文探讨了股东参与治理所带来的私人收益、特定股权结构的社会收益以及股权集中成本三者之间的关系。我们分析的结果表明,当股东与经理人员之间的利益冲突水平较高、其它治理机制的作用较弱时,股权集中(股东参与治理的积极性较高)可以创造大量的社会收益;反之,股权的集中与分散程度(股东参与治理的积极性较低)对社会收益的影响不明显。本文的研究结论为我国股东参与治理及股权结构改革提供了重要启示。     

Migration and Development: Mexico and Turkey

Mexico and Turkey are among the world's leading labor‐sending nations, with about 11 million Mexican‐born and 3.5 million Turkish‐born persons abroad in 2006. After two decades of uneven growth and job creation as well as persisting poverty and inequality, there are debates within both countries asking whether economic reforms have gone far enough to put the economy on a stable footing for sustained and equitable growth, or whether emigration (pressure) will continue. Some Mexicans are seeking to deepen North American Free Trade Agreement, while most Turks support entry into the European Union as a way of speeding economic growth.     

High School Family Centers: Transformative Spaces Linking Schools and Families in Support of Student Learning

ABSTRACT

This study explores school, family, and community partnership at the high school level, using eight family centers as the entry point for the investigation. The purpose of the study was to identify ways that parents and school staff could collaborate to support high school students' achievement. The study findings led to the development of a model that represents three inputs that are crucial to the creation of a successful family center: (1) a supportive infrastructure, (2) the existence of skilled center staff, and (3) the presence of responsive programming. These three inputs led to the creation of a thriving center that acts as a transformative space, a “zone of community,” that results in four outputs: (1) the creation of relational trust among adults, (2) shift in parents' role construction and efficacy, (3) the generation of student relational trust, and (4) the development of student efficacy. The data from this study suggest that the relational trust developed in these transformative spaces called family centers can have a positive effect on student efficacy. The study concludes with seven recommendations for schools and districts looking to establish family centers in high schools as a way to expand family engagement at the high school level.     

Student-faculty perceptions of multicultural training in accredited marriage and family therapy programs in relation to students' self-reported competence

Although the marriage and family therapy field's recent attention to multicultural issues is laudable, there appears to be little clarity on what constitutes an effective multicultural training program and the impact of the effects of such training on trainee multicultural competence. The field continues to be challenged at different levels-training, practice, research, the setting of the standards and the work of the Commission on Accreditation for Marriage and Family Therapy Education, and the goals and strategic plan of the American Association for Marriage and Family Therapy Board. This study focused on assessing the extent of multicultural integration at different levels of training and the relationship between such training and students' perception of their own multicultural competence.