A STRATEGY FOR RISK REDUCTION IN INCENTIVE CONTRACTING*

An important question with respect to government incentive contracts that has received little attention is: What alternatives to the current practice of making single-stage choices of incentive sharing rates can lead to situations in which these sharing rates can be chosen under reduced risk or cost uncertainty? This paper provides a decision-theoretic framework that illustrates a possibility of reducing risk, from the viewpoints of both the contracting parties, given some negotiated estimate of costs to be incurred. It is shown that such a possibility can arise in a situation in which it is technically feasible to separate or partition the contractual work into closely related tasks or units. Specifically, it is demonstrated that for a given cost estimate (target cost) and target profit, a set of optimal sharing rates (one for each unit) yields a higher risk-adjusted value of the contract than the single-stage sharing rate for the entire contract.     

印度和中国——文明的和谐

特邀编者按:应中国共产党总书记胡锦涛同志的邀请,印度国大党主席索尼娅·甘地女士于2007年10月25日至29日访华.期间,胡锦涛总书记、温家宝总理亲切会见了她,就双边关系中的广泛话题展开了富有成效的、建设性的讨论.     

Detecting diagnostic accuracy of two biomarkers through a bivariate log-normal ROC curve

In biomedical research, two or more biomarkers may be available for diagnosis of a particular disease. Selecting one single biomarker which ideally discriminate a diseased group from a healthy group is confront in a diagnostic process. Frequently, most of the people use the accuracy measure, area under the receiver operating characteristic (ROC) curve to choose the best diagnostic marker among the available markers for diagnosis. Some authors have tried to combine the multiple markers by an optimal linear combination to increase the discriminatory power. In this paper, we propose an alternative method that combines two continuous biomarkers by direct bivariate modeling of the ROC curve under log-normality assumption. The proposed method is applied to simulated data set and prostate cancer diagnostic biomarker data set.     

Connected Substitutes and Invertibility of Demand

We consider the invertibility (injectivity) of a nonparametric nonseparable demand system. Invertibility of demand is important in several contexts, including identification of demand, estimation of demand, testing of revealed preference, and economic theory exploiting existence of an inverse demand function or (in an exchange economy) uniqueness of Walrasian equilibrium prices. We introduce the notion of “connected substitutes” and show that this structure is sufficient for invertibility. The connected substitutes conditions require weak substitution between all goods and sufficient strict substitution to necessitate treating them in a single demand system. The connected substitutes conditions have transparent economic interpretation, are easily checked, and are satisfied in many standard models. They need only hold under some transformation of demand and can accommodate many models in which goods are complements. They allow one to show invertibility without strict gross substitutes, functional form restrictions, smoothness assumptions, or strong domain restrictions. When the restriction to weak substitutes is maintained, our sufficient conditions are also “nearly necessary” for even local invertibility.     

Informational and documentational needs for education and training for health and family welfare--"para-professional and auxiliary"

In this paper, the author stressed the needs for a central arrangement for acquisition, exchange and dissemination of scientific information in the field of health and family welfare so as to increase the efficiency and effectiveness of planning, administration and evaluation of health and family planning programmes and also to carry out research when needed. The proposed arrangement in the form of a documentation centre must collect information on health care systems as their main functions so that the information and documentational needs for the education and training of health personnel are rationally developed in the context of present and future health needs and demands.     

Connecting Two Sides: A Qualitative Study on Social Innovation Ventures and Poor Communities in an Emerging Economy

VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations - The relationship between social innovation venture and poor communities has received little attention from studies in the...     

Development of Indicators for Family Well-Being in Malaysia

This study was carried out to develop a set of indicators for measuring and reporting the state of family well-being in Malaysia, and subsequently, to produce an Index of Family Well-Being. To build the set of indicators, domains of family well-being and relevant indicators were identified from past studies. Focus group discussions with families, professional groups and NGOs helped to refine the indicators prior to the main study. Using a stratified random sampling design, 2,808 households were identified (a parent and a child aged at least 13 years), making a total sample of 5,616 respondents. Results indicated ten key indicators that can predict family well-being—resiliency, safety, savings, healthy lifestyle, time with family, work-family balance, importance of religion, number of bedrooms at home, debt and child care—supporting the notion of family well-being being multi-dimensional and interconnected. On the basis of the results, a model of family well-being was hypothesized. This model was used to guide the development of the Index of Family Well-being. Confirmatory factor analysis (CFA) was carried out to determine the fit of the model to data. Five domains of family well-being were identified—family relationships, economic situation, health and safety, community relationship and religion/spirituality. The Index of Family Well-Being was calculated using the equal weighting strategy to each of these five domains. This index showed that the current family well-being of Malaysians is relatively high at 7.95 (SD = 1.38) on a 0–10 Likert response format. The findings suggest that family well-being is multifaceted, made up not only of the immediate family relationships and health and safety of its members, but include having adequate income to meet the demands of a minimum standard of living. Currently, the Index that is developed is only in the form of a numerical value reflecting the state of family well-being, but in future, it can be used to track changes in the family from time to time.     

Identification and Inference in Ascending Auctions With Correlated Private Values

We introduce and apply a new nonparametric approach to identification and inference on data from ascending auctions. We exploit variation in the number of bidders across auctions to nonparametrically identify useful bounds on seller profit and bidder surplus using a general model of correlated private values that nests the standard independent private values (IPV) model. We also translate our identified bounds into closed form and asymptotically valid confidence intervals for several economic measures of interest. Applying our methods to much studied U.S. Forest Service timber auctions, we find evidence of correlation among values after controlling for a rich vector of relevant auction covariates; this correlation causes expected profit, the profit‐maximizing reserve price, and bidder surplus to be substantially lower than conventional (IPV) analysis of the data would suggest.     

Minimum variance rectangular designs for U-statistics

We consider a certain class of rectangular designs for incomplete U-statistics based on Latin squares and show it to be optimal with respect to the minimal variance criterion. We also show it to be asymptotically efficient when compared with the corresponding complete statistics, as well as uniformly more efficient than the random subset selection. We provide the necessary and sufficient conditions for the existence of our design and give some examples of applications.     

The Indian diaspora in global advocacy

The activities of Indian diasporic activists in the subcontinent and North America are explored in order to question the simple dichotomies and categories through which advocacy networks are often understood. These dichotomies include West/non–West, violence/non–violence and local/global. The argument illuminates some of pressures, contradictions and fissures shaping the Indian diaspora’s involvement in advocacy issues. There are culturally specific spaces and strategies for advocacy practice, at the same time as advocacy issues acquire new meanings through involvement in more transnational networks.