assortment planning in fashion retailing methodology application and analysis abstract assortment planning is the process conducted by the retailer to determine the number and types of products in a line key questions that arise in this process include choosing the inventory depth and variety breadth and the mix between basic and fashion merchandise of the assortment to maximize expected profits we describe a method for resolving these questions using demand forecasts derived from historical sales patterns we use a nonlinear integer programming model to make the assortment choice efficient heuristics are developed to solve this problem we applied our method at a large catalog retailer specializing in women s apparel we compared our method to the existing rules used by this retailer and found that it could choose the assortment in a manner that reduces markdowns due to excessive inventory and lost margins due to stockouts by enough to increase profits by at least 40 insights are developed to better understand why products are included in an assortment and the implications of this choice on the realized profit we extend our model to include shelf space constraints and the effect of assortment choice on product demand

bank lending channel in a dual banking system why are islamic banks so responsive we examine the interest rate sensitivity of both deposits and credits at islamic and conventional banks in turkey we find that the bank lending channel is especially operative for islamic banks impulse responses for conventional and islamic banks reveal that islamic bank depositors sensitivity to policy rate changes is substantially larger than that of conventional bank depositors next to heavily dependence on deposit funding we consider that inertia in islamic bank deposit rates impedes these banks to keep those depositors who consider the opportunity cost of monetary policy rates is unbearable on the lending side we obtain similar results implying that tight monetary policy leads to a larger contraction in islamic bank credits this finding is a reflection of the favourable attitude of islamic banks towards small and medium sized enterprise sme financing when similar relationships are analysed for currency and inflation shocks we again find larger responses for islamic banks showing the cyclical nature of sme credits

pricing decision for substitutable products with retail competition in a fuzzy environment abstract this paper studies the pricing problem of substitutable products in a supply chain with one manufacturer and two competitive retailers the consumer demands and manufacturing costs are of uncertainty which are described by fuzziness based on different market structures one centralized pricing model and three decentralized pricing models are developed and the corresponding analytical equilibrium solutions are obtained using the game theoretic approach finally numerical examples are presented to illustrate the effectiveness of the theoretical results and to gain additional managerial insights

single period multiproduct inventory models with substitution we study a single period multiproduct inventory problem with substitution and proportional costs and revenues we consider n products and n demand classes with full downward substitution i e excess demand for class i can be satisfied using product j for i j we first discuss a two stage profit maximization formulation for the multiproduct substitution problem we show that a greedy allocation policy is optimal we use this to write the expected profits and its first partials explicitly this in turn enables us to prove additional properties of the profit function and several interesting properties of the optimal solution in a limited computational study using two products we illustrate the benefits of solving for the optimal quantities when substitution is considered at the ordering stage over similar computations without considering substitution while ordering specifically we show that the benefits are higher with high demand variability low substitution cost low profit margins or low price to cost ratio high salvage values and similarity of products in terms of prices and costs

the competitive newsboy we consider a competitive version of the classical newsboy problem in which a firm must choose an inventory or production level for a perishable good with random demand and the optimal solution is a fractile of the demand distribution and investigate the impact of competition upon industry inventory a splitting rule specifies how initial industry demand is allocated among competing firms and how any excess demand is allocated among firms with remaining inventory we examine the relation between equilibrium inventory levels and the splitting rule and provide conditions under which there is a unique equilibrium our most general result is that if all excess demand is reallocated i e there is perfect substitutability then competition never leads to a decrease in industry inventory

debt and growth new evidence for the euro area abstract against the background of the euro area sovereign debt crisis our paper investigates the relationship between public debt and economic growth and adds to the existing literature in the following ways first we use a dynamic threshold panel methodology in order to analyse the non linear impact of public debt on gdp growth second we focus on 12 euro area countries for the period 1990 2010 therefore adding to the current discussion on debt sustainability in the euro area our empirical results suggest that the short run impact of debt on gdp growth is positive and highly statistically significant but decreases to around zero and loses significance beyond public debt to gdp ratios of around 67 this result is robust throughout most of our specifications in the dynamic and non dynamic threshold models alike for high debt to gdp ratios above 95 additional debt has a negative impact on economic activity furthermore we can show that the long term interest rate is subject to increased pressure when the public debt to gdp ratio is above 70 broadly supporting the above findings

does sovereign debt weaken economic growth a panel var analysis we estimate panel vector autoregressions to analyze the highly disputed relationship between sovereign debt and economic growth using data on 20 developed countries we find no evidence for a robust effect of debt on growth even for higher levels of debt we do find a significant negative reverse effect of growth on debt which explains the negative correlation

is growth corrupted or bureaucratic panel evidence from the enlarged eu abstractthis article aims at analysing the issue of conditional convergence in the new enlarged european union eu over the period 1995 2012 by means of panel data techniques we examined the issue of conditional convergence in the enlarged eu giving particular attention to the effects of corruption and bureaucracy on growth controlling for a widely used set of explanatory variables such as investment domestic and foreign human capital formation inflation general government final consumption and trade openness furthermore we examine if growth responds differently to corruption and bureaucracy in the new eu members by means of two group specific interaction variables to capture possible different responses to corruption and bureaucracy the analysis reveals evidence of conditional convergence in the enlarged eu with investment share foreign direct investment human capital and country openness appearing as robust growth drivers in contrast inflation and government consumption rather hamper gro

the implications of costs capacity and competition on product line selection we consider a situation in which a manufacturer has to select the product s to sell as well as the selling price and production quantity of each selected product there are two substitutable products in the consideration set where product 2 has a higher quality and reservation price than that of product 1 by considering the cannibalization effect that depends on the selling price of each product the manufacturer needs to evaluate the profit function associated with three different product line options sell both products or only one of the 2 products in order to examine the impact of costs capacity and competition on the optimal product line selection optimal price and optimal production quantity analytically we present a stylized model in this paper so that we can determine the conditions under which a particular option is optimal

unbundled debt and economic growth in developed and developing economies an empirical analysis we unbundle the effect of debt on economic growth using a new panel dataset sourced from vague 2014 for 48 countries over the period 1961 to 2015 we distinguish between public private household and non financial corporation debt we use the pvar approach granger causality tests and impulse response to establish causality we also test the heterogeneity in the debt growth relationship across developed and developing countries in our full sample of countries all types of debt appear to be harmful for economic growth the negative effect of public debt appears to be uniform across developed and developing countries although the impact is much stronger on developed countries household debt appears to be expansionary in developing countries whereas contractionary in developed countries non financial corporation debt appears to have no impact on developing countries but negative impact on developed countries finally total debt i e the sum of public household and non financial corporation debt has a negative impact on growth in developed countries but no impact is detected in the case of developing countries

aid and income another time series perspective summary this study provides a replication of the empirical results reported by nowak lehmann dreher herzer klasen and martinez zarzoso 2012 henceforth ndhkm we uncover that ndhkm relied on a regression model which included a log transformation of variables that are not strictly positive this led to nonrandom omission of a large proportion of observations furthermore we show that ndhkm s use of co integrated regressions is not a suitable empirical strategy for estimating the causal effect of aid on income evidence from a panel var model estimated on the dataset of ndhkm suggests a positive and statistically significant long run effect of aid on income

stocking retail assortments under dynamic consumer substitution we analyze a single period stochastic inventory model newsboy like model in which a sequence of heterogeneous customers dynamically substitute among product variants within a retail assortment when inventory is depleted the customer choice decisions are based on a natural and classical utility maximization criterion faced with such substitution behavior the retailer must choose initial inventory levels for the assortment to maximize expected profits using a sample path analysis we analyze structural properties of the expected profit function we show that under very general assumptions on the demand process total sales of each product are concave in their own inventory levels and possess the so calleddecreasing differences property meaning that the marginal value of an additional unit of the given product is decreasing in the inventory levels of all other products for a continuous relaxation of the problem we then show via counterexamples that the expected profit function is in general not even quasiconcave thus global optimization may be difficult however we propose and analyze a stochastic gradient algorithm for the problem and prove that it converges to a stationary point of the expected profit function under mild conditions finally we apply the algorithm to a set of numerical examples and compare the resulting inventory decisions to those of some simpler naive heuristics the examples show that substitution effects can have a significant impact on an assortment s gross profits the examples also illustrate some systematic distortions in inventory decisions if substitution effects are ignored in particular under substitution one should stock relatively more of popular variants and relatively less of unpopular variants than a traditional newsboy analysis indicates

complex losses allocation to generators and loads based on circuit theory and aumann shapley method this paper presents a new method to allocate active and reactive losses simultaneously to generators and loads the allocation is calculated for each transmission branch identifying and quantifying the buses responsibilities in losses this is a two step process in the first step generators are modeled as current injections and loads as constant admittances in order to determine generator participations in losses in the second step loads are modeled as current sources and generators as constant admittances in order to determine load participations in losses the aumann shapley and circuit theories are used to calculate the participation of each real and imaginary current component considering them as independent players in the complex losses allocation game the properties of the aumann shapley method ensure equitable allocation and recovery of the total active and reactive losses counter flow cross subsidy and negative allocation issues are discussed numerical results are presented and discussed to demonstrate the applicability of the proposed method

the economics of product variety a survey demand for variety may arise from a taste for diversity in individual consumption and or from diversity in tastes even when each consumer chooses a single variant the full degree of variety potentially demanded will not in general be supplied because scale economies even to a small degree mean that the potential welfare or revenue gain from greater variety must be balanced against the lower unit production costs with fewer variants the economics of product variety consists essentially in analysing the effect of this balance in different situations and comparing the degree of product variety for different market structures with each other and with the optimum the survey commences with the work on market structures with single product firms generalized monopolistic competition tracing modern developments in both the chamberlinian and hotelling traditions the latter has been particularly fruitful due to the expansion of the original locational ideas into virtual spaces in product characteristics the emphasis in recent work on product variety has been on multiproduct firms in both monopolistic and oligopolistic structures including strategic market preemption although most work has been in a full information context there have been advances in product variety under imperfect information either by consumers to properties of the firms products or firms as to consumers demands

transmission loss unbundling and allocation under pool electricity markets this paper presents a methodology based on the circuit theories for unbundling and allocation of transmission losses among the participants of a pool based electricity market starting from a known operation point and using the basic network equations without additional assumptions an expression of the branch losses based on nodal current injections is derived since the power flow equations and circuit theories are satisfied the methodology turns explicit in a natural way separating the losses at each system branch and assigning the responsibility to the respective market participants it means that the loss allocation of each branch which is produced by each generator and consumer is obtained extensions and strategies considering unsubsidized and predefined proportion based loss allocation as well as issues related with the allocation fairness and transparency are also included comparisons with previous methods and validation tests of the proposed method are reported by using the ieee reliability test system

does government debt crowd out capital formation a dynamic approach using panel var abstract we estimate a panel vector autoregression model using data for 127 countries from 1980 to 2017 in order to identify the dynamic relationship between public debt and the growth of capital formation our results provide evidence for the crowding out effect of government debt and the subsequent drop in output growth the impulse response functions for sub samples of countries reveal two remarkable results first the response of capital formation to a shock in debt appears to be consistent across different income categories of countries and does not depend on the size of debt to gdp ratio second the magnitude and persistence of this effect is lower for the high income countries the results obtained are robust to various model specifications as well as for alternative proxies of debt and capital formation

does high public debt consistently stifle economic growth a critique of reinhart and rogoff we replicate reinhart and rogoff 2010a and 2010b and find that selective exclusion of available data coding errors and inappropriate weighting of summary statistics lead to serious miscalculations that inaccurately represent the relationship between public debt and gdp growth among 20 advanced economies over 1946 2009 countries with public debt gdp ratios above 90 averaged 2 2 real annual gdp growth not 0 1 as published the published results for i median gdp growth rates for the 1946 2009 period and ii mean and median gdp growth figures over 1790 2009 are all distorted by similar methodological errors although the magnitudes of the distortions are somewhat smaller than with the mean figures for 1946 2009 contrary to reinhart and rogoff s broader contentions both mean and median gdp growth when public debt levels exceed 90 of gdp are not dramatically different from when the public debt gdp ratios are lower the relationship between public debt and gdp growth varies significantly by period and country our overall evidence refutes rr s claim that public debt gdp ratios above 90 consistently reduce a country s gdp growth

a weakly conditioned imputation of an impedance branch dissipation power in a sinusoidal steady state circuit how much of an impedance branch dissipation power should be assigned to each source the answer is the basis of electricity transmission pricing such as the pricing of line loss and line security due to thermal limit however it is difficult to obtain a unique and common consent answer because of the nonlinearity of power expression this paper presents two weakly conditioned imputation formulas respectively for dissipation active and reactive power to answer the question first a detailed form of shapley value formula and three weak conditions are proposed on this basis the two imputation formulas are then derived and proved mathematically the imputation formulas are explicitly in terms of source currents voltages thus analytic and easy to compute they possess eight mathematical and economic features that lay a good foundation for electricity transmission pricing the two imputation formulas are also extended to actual power systems where trades are conducted in mwh mvarh instead of amperes volts numerical examples illustrate their computing process and features

the impact of product substitution on retail merchandising abstract we analyze the impact of product substitution on two key aspects of retail merchandising order quantities and expected profits to perform this analysis we extend the basic news vendor model to include the possibility that a product with surplus inventory can be used as a substitute for out of stock products this extension requires a definition and an approximation for the resulting effective demand under substitution a service rate heuristic is developed to solve the extended problem the performance of this heuristic is evaluated using an upper bound generated by solving the associated lagrangian dual problem our analysis suggests that this heuristic provides a tractable and accurate method to determine order quantities and expected profits under substitution we apply this heuristic to examine how the level of demand uncertainty and correlation and the degree of substitution between products affect order quantities and expected profits under substitutable demand in addition we use the heuristic to better understand the mechanism by which substitution improves expected profits

a novel nucleolus based loss allocation method in bilateral electricity markets the situation of current research on power losses allocation in bilateral electricity markets is presented based on cooperative game theory a novel nucleolus theory based method for power losses allocation under the bilateral transactions model is put forward and compared in detail with the shapley value based allocation method the impacts of different market players on network power losses are taken into account with the new method network power losses can be allocated to each transaction reasonably the allocation results would not be affected by the sequence that each transaction is formed and be active the method answers for the open equal and impartial principles of electricity market and can be easily understood and accepted by market players numerical tests validated the equity and validity of the method

on the relationship between inventory costs and variety benefits in retailassortments consider a category of product variants distinguished by some attribute such as color or flavor a retailer must construct an assortment for the category i e select a subset variants to stock and determine purchase quantities for each offered variant we analyze this problem using a multinomial logit model to describe the consumer choice process and a newsboy model to represent the retailer s inventory cost we show that the optimal assortment has a simple structure and provide insights on how various factors affect the optimal level of assortment variety we also develop a formal definition of the level of fashion in a category using the theory of majorization and examine its implications for category profits

competitive positioning in markets with nonuniform preferences we investigate the nature of competitive equilibrium for brands competing in a multi attribute product space when consumer preferences for product attributes follow nonuniform distributions we establish subgame perfect equilibria in a two stage game where firms choose positions in the first stage and prices in the second stage two types of entry scenarios are investigated in the first the number of brands is given exogenously and all of them choose positions simultaneously in the second scenario firms enter in sequence and the early entrants can choose strategies to deter the entry of later entrants we find the equilibria for two three and four brands for consumer preferences that follow a beta distribution nonuniform distributions result in equilibrium configurations that are substantially different from those obtained for uniform consumer distributions in the two brands case for sufficiently concentrated distributions we find asymmetric position equilibria with one firm at the corner of the market and one firm at an interior position in the case of three brands for sufficiently concentrated preferences we find symmetric equilibria that do not yield maximal differentiation we also establish an equilibrium for the case of four competing brands in addition we characterize entry deterring positioning strategies and examine how they vary with the distribution of consumer preferences

on the partition of transmission losses among generators due to the introduction of competition in the electrical power industry determining the percentage of transmission grid losses that should be attributed to each generator has become important usually this is accomplished by determining the percentage of each transmission branch losses that should be attributed to each generator using the aumann shapley theory this letter identifies the fairest way to share the nonseparable portion of losses amongst the generators the obtained result validates some approximations assumed in recent papers and contributes to strengthening circuit theory based methods

public debt economic growth and the real interest rate a panel var approach to eu and oecd countries we investigate the causal relationship between the public debt to gdp ratio and economic growth for 31 eu and oecd countries from 1995 to 2013 a number of studies have tackled this problem but very few make the transmission mechanism explicit in their analysis we estimate a panel var model that incorporates the long term real interest rate on government bonds as a vehicle to transmit shocks in both the public debt to gdp ratio and economic growth we find no causal link from the public debt to gdp ratio to the gdp growth rate irrespective of the levels of public debt rather we find a causal relation from the gdp growth rate to the public debt to gdp ratio in high debt countries the direct negative impact of economic growth on public debt is enhanced by a rise in the long term real interest rate which in turn decreases interest sensitive demand and leads to a further increase in the public debt to gdp ratio

revisiting the bi directional causality between debt and growth evidence from linear and nonlinear tests abstract we revisit the bi directional causality between public debt and the rate of gdp growth for 10 emu countries alongside the us uk and japan over sample periods spanning from 1970 up to 2014 whilst accounting for the nonlinear properties of both the individual time series and their relation in both directions our results indicate that the causal relation between debt and growth in either direction is weak at best for most of the countries in our sample we find no robust evidence of a long run causal effect using bi variate granger causality tests bi directional causality is detected only for austria while for france luxembourg and portugal causality runs solely from debt to growth but the estimated effects are very small in finland spain and italy granger causality from growth to debt in the former two and debt to growth in italy appears to be present in the short run our findings cannot be taken as evidence that a high level of public indebtedness is not risky for the economy or as invalidating hypotheses postulating effects in either direction in the relation between debt and growth

commonality decisions when designing for multiple markets abstract it is well established that a manufacturer s commonality decisions between related products are driven by trade offs between cost savings from standardization and demand effects of customization prior research has examined these trade offs in the context of product line design for a single geography where cannibalization is a primary concern however the insights from a single market may not readily apply when serving related products for different geographies where cannibalization ceases to be a concern the downside of commonality for geographically separated markets arises from a mismatch in customer preferences which results in disutilities in this paper we model the trade off between the consumer side disutilities and the cost side scale economies in the presence of demand uncertainty and derive the optimal extent of commonality between products for both the markets in the context of two product development strategies i primary market centric design pmd and ii design for multiple markets dfm our insights from analytical and numerical analysis show that when consumers are very picky and market uncertainty is low the dfm strategy outperforms the pmd strategy counter to the practice of introducing primary market centric products into emerging markets our study demonstrates the need for more customization especially in small but uncertain markets our research has important implications for automakers in integrating the diversity in tastes while making commonality decisions for multiple markets

assortment planning and inventory decisions under a locational choice model we consider a single period assortment planning and inventory management problem for a retailer using a locational choice model to represent consumer demand we first determine the optimal variety product location and inventory decisions under static substitution and show that the optimal assortment consists of products equally spaced out such that there is no substitution among them regardless of the distribution of consumer preferences the optimal solution can be such that some customers prefer not to buy any product in the assortment and such that the most popular product is not offered we then obtain bounds on profit when customers dynamically substitute using the static substitution for the lower bound and a retailer controlled substitution for the upper bound we thus define two heuristics to solve the problem under dynamic substitution and numerically evaluate their performance this analysis shows the value of modeling dynamic substitution and identifies conditions in which the static substitution solution serves as a good approximation