oil price cycles and wavelets abstract the present paper addresses the question of the oil price macroeconomy relationship using world data and a time scale decomposition based on the theory of wavelets our approach is based on a global indicator the morgan stanley capital international msci index for the world and on the new framework offered by wavelets to analyse the oil price cycles and to investigate the oil price msci relationship this original approach enables us to identify that the cycles which contribute the most to oil price variations are 20 to 40 years cycles which correspond to the size of kuznets infrastructure cycles and probably represent energy investment cycles this wavelet decomposition also provides additional evidence to the reverse causality theory

on the price of recreation goods as a determinant of male labor supply we examine whether and how variations in the price of recreation goods influence men s allocation of market work for the united states individual level data are combined with metropolitan area level price indices to estimate the male elasticity of intertemporal substitution of market work with respect to the price of recreation goods which is found around 0 16 and statistically significant the allocation of market work in response to changes in the price of recreation goods would create movements in the output of an economy moreover it could contribute toward explaining the emerging differences in work and leisure between the united states and europe

sports sentiment and stock returns this paper investigates the stock market reaction to sudden changes in investor mood motivated by psychological evidence of a strong link between soccer outcomes and mood we use international soccer results as our primary mood variable we find a significant market decline after soccer losses for example a loss in the world cup elimination stage leads to a next day abnormal stock return of 49 basis points this loss effect is stronger in small stocks and in more important games and is robust to methodological changes we also document a loss effect after international cricket rugby and basketball games this paper employs a novel mood variable international soccer results to investigate the effect of investor sentiment on asset prices using a cross section of 39 countries we find that losses in soccer matches have an economically and statistically significant negative effect on the losing country s stock market for example elimination from a major international soccer tournament is associated with a next day return on the national stock market index that is 38 basis points lower than average we also document a loss effect after international cricket rugby and basketball games on average the effect is smaller in magnitude for these other sports than for soccer but is still economically and statistically significant we find no evidence of a corresponding effect after wins for any of the sports that we study controlling for the pre game expected outcome we are able to reject the hypothesis that the loss effect after soccer games is driven by economic factors such as reduced productivity or lost revenues we

integrating replenishment decisions with advance demand information there is a growing consensus that a portfolio of customers with different demand lead times can lead to higher more regular revenues and better capacity utilization customers with positive demand lead times place orders in advance of their needs resulting inadvance demand information this gives rise to the problem of finding effective inventory control policies under advance demand information we show that state dependent s s and base stock policies are optimal for stochastic inventory systems with and without fixed costs the state of the system reflects our knowledge of advance demand information we also determine conditions under which advance demand information has no operational value a numerical study allows us to obtain additional insights and to evaluate strategies to induce advance demand information

stock rationing under service level constraints in a vertically integrated distribution system this paper addresses a rationing problem in a two level vertically integrated distribution system composed of one manufacturer and several retail points the motivating case developed in the vending machine sector and modeled as a newsvendor like problem is representative of many real settings where short term changes in demand can be substantial while capacity modification is not a viable option the paper provides an analytical discussion of the problem from two different standpoints a pure profit maximization perspective and a minimum service level perspective both subject to a product availability constraint that affects the service level the company can provide and the related expected profit by analyzing the lagrangean formulation of the problem we devise efficient computational procedures based on dichotomy search to find the optimal allotments to retailers maximizing the expected profit and ensuring a minimum service level then we extend the analysis to the evaluation of the highest service level that can be provided under a product availability constraint we identify conditions such that the proposed search procedures succeed in finding the optimal solutions as well as bounds for the search domains the proposed approach is legitimated under several demand distribution functions subject to a few commonly adopted restrictions that encompass many of the usually adopted continuous distributions finally the paper presents a three step decision making framework using the proposed procedures summarizing the decision paths the manufacturer might follow in order to optimize the allocation decision

modelling imperfect advance demand information and analysis of optimal inventory policies we consider an inventory control problem where it is possible to collect some imperfect information on future demand we refer to such information as imperfect advance demand information adi which may occur in different forms of applications a simple example is a company that uses sales representatives to market its products in which case the collection of sales representatives information as to the number of customers interested in a product can generate an indication about the future sales of that product hence it constitutes imperfect adi other applications include internet retailing vendor managed inventory vmi applications and collaborative planning forecasting and replenishment cpfr environments we develop a model that incorporates imperfect adi with ordering decisions under our system settings we show that the optimal policy is of order up to type where the order level is a function of imperfect adi we also provide some characterizations of the optimal solution we develop an expression for the expected cost benefits of imperfect adi for the myopic problem our analytical and empirical findings reveal the conditions under which imperfect adi is more valuable

customer order information leadtimes and inventories we have an inventory to manage the scenario is standard in all respects save one instead of arriving unannounced customers provide advance warning of their demands how should we use this information and what is its effect on system performance the answers turn out to be strikingly simple there are very simple policies which perform effectively in some cases optimally also such demand leadtimes improve performance in precisely the same way that replenishment leadtimes degrade it

approximate solutions for a stochastic lot sizing problem with partial customer order information we address a stochastic single product manufacturing system in a make to stock environment with partial knowledge on future demand resulting from customers ordering in advance of their actual needs the problem consists of determining the optimal size of a production lot to replenish inventory so that delivery promises are met on time at the expense of minimal average costs a markov decision model is formulated for finding the optimal policy however since the optimal policy is likely to be too complex in most practical situations we present approximate strategies for obtaining good production lot sizes the well known r s inventory policy is compared to two rules where production decisions take into account the available information on future customer requirements and the probabilistic characterization of orders yet to be placed furthermore it is shown that the s s inventory policy is a special case of one of the rules an extensive numerical study reveals that the newly developed strategies outperform classical inventory policies

capacity rationing decision procedures with order profit as a continuous random variable abstract when expected demand is more than available capacity a make to order manufacturer should take the more profitable orders and reject the less profitable orders in order to better allocate its limited capacity and maximize its profit however various orders will arrive at different times in the future so the manufacturer cannot look at all the order inquiries at the same time and choose the most profitable ones when an order inquiry arrives the manufacturer must promptly determine without knowing exactly what the future orders might be whether to accept the order or to reject the order thus reserving the capacity for future more profitable orders this study focuses on such an order selection decision problem under the following assumptions 1 the arrival of future customer orders is a poisson process 2 the capacity requirement of a future customer order is a continuous random variable and 3 the profit per unit capacity used by an order is also a continuous random variable under the stochastic problem assumptions this study investigates two decision procedures that determine whether to accept or to reject an order inquiry based on the available information including 1 current available manufacturing capacity 2 capacity requirement by the order and 3 the profit per unit capacity of the order one procedure is called static probability capacity rationing decision procedure spcr the other one is called dynamic stochastic capacity rationing decision procedure dscr simulation experiments are conducted to validate the proposed procedures an optimal solution method that uses 0 1 knapsack problem formulation to obtain the decisions with perfect information is used to measure the effectiveness of the proposed procedures the results show that the approach utilizing dscr outperforms other approaches by providing the highest profit and is also very robust under various problem conditions

optimal policies for inventory systems with priority demand classes we consider a periodic review inventory system with two priority demand classes one deterministic and the other stochastic the deterministic demand must be met immediately in each period however the units of stochastic demand that are not satisfied during the period when demand occurs are treated as lost sales at each decision epoch one has to decide not only whether an order should be placed and how much to order but also how much demand to fill from the stochastic source the firm has the option to ration inventory to the stochastic source i e not satisfy all customer demand even though there is inventory in the system we first characterize the structure of the optimal policy we show that in general the optimal order quantity and rationing policy are state dependent and do not have a simple structure we then propose a simple policy called s k s policy wheres ands ordering policy determine when and how much to order whilek rationing policy specifies how much of the stochastic demand to satisfy we report the results of a numerical study which shows that this simple policy works extremely well and is very easy to compute

a multivariate cointegration analysis of the role of energy in the us macroeconomy abstract this paper extends my previous analysis of the causal relationship of gdp and energy use in the usa in the post war period a majority of the relevant variables are integrated justifying a cointegration analysis the results show that cointegration does occur and that energy input cannot be excluded from the cointegration space the results are plausible in terms of macroeconomic dynamics the results are similar to my previous granger causality results and contradict claims in the literature based on bivariate models that there is no cointegration between energy and output

a threshold inventory rationing policy for service differentiated demand classes motivated by a study of the logistics systems used to manage consumable service parts for the u s military we consider a static threshold based rationing policy that is useful when pooling inventory across two demand classes characterized by different arrival rates and shortage stockout and delay costs the scheme operates as a q r policy with the following feature demands from both classes are filled on a first come first serve basis as long as on hand inventory lies above a threshold levelk once on hand inventory falls below this level low priority i e low shortage cost demand is backordered while high priority demand continues to be filled we analyze this static policy first under the assumption that backorders are filled according to a special threshold clearing mechanism structural results for the key performance measures are established to enable an efficient solution algorithm for computing stock control and rationing parameters i e q r andk numerical results confirm that the solution under this special threshold clearing mechanism closely approximates that of the priority clearing policy we next highlight conditions where our policy offers significant savings over traditional round up and separate stock policies encountered in the military and elsewhere finally we develop a lower bound on the cost of the optimal rationing policy numerical results show that the performance gap between our static threshold policy and the optimal policy is small in environments typical of the military and high technology industries

12 million salaried workers are missing evidence from current population surveys various cohorts of the national longitudinal surveys and the panel study of income dynamics suggests that the fraction of american employees who were paid salaries held constant from the late 1960s through the late 1970s and continued to hold constant or perhaps fell slightly thereafter through the late 1990s an analysis that accounts for the changing industrial occupational demographic and economic structure of the work force shows that this fraction was 9 percentage points below what would have been expected in the late 1970s this shortfall is not explained by growth in the temporary help industry declining unionization institutional changes in overtime or wage payment regulation the increasing openness of american labor and product markets or convergence of nonwage aspects of hourly and salaried employment the author suggests several alternative explanations

what happened to the oil price macroeconomy relationship abstract strong evidence is found that oil prices no longer granger cause many u s macroeconomic indicator variables in data after 1973 a number of potential explanations are explored that sample stability issues are responsible that oil prices are now endogenous and that linear and symmetric specifications misrepresent the form of the oil price interaction none of these hypotheses are supported by the data the opec price increases do appear to have had significant impacts while the effects of the price declines of the 1980s are smaller and harder to characterize these results have potentially important implications for the large body of research which utilizes oil prices as an instrumental or explanatory variable

purchasing demand information in a stochastic demand inventory system this paper studies a periodic review stochastic demand inventory system in which the manager has the opportunity each period to purchase information about demand in the upcoming period before deciding how much product to order we analyze the information purchase and product replenishment decisions for both perfect and imperfect demand information under perfect information we provide a characterization of the optimal policy for both finite and infinite horizon problems and also establish useful managerial insights into the behavior of the system we show that future demand information becomes less valuable at higher inventory levels and more valuable when longer horizons remain when the initial inventory is zero solving the perfect information problem reduces to computing a single quantity for which we provide a closed form expression as a result this problem is shown to be equivalent to one in which the manager purchases perfect information over the entire horizon with a single lump sum payment at the beginning of the horizon our analytical and numerical results demonstrate that most of the insights from the perfect information scenario carry over to the imperfect information case

the effect of permanent employment on absenteeism evidence from labor reform in spain restrictive employment protection legislation has been highlighted as a key reason for lower labor productivity in europe compared to the united states evidence in the literature has shown robust effects of employment protection on effort though the effects appear too small to generate marked cross country differences in labor productivity the authors revisit this issue using representative data of private sector workers in spain a range of legislative changes aimed at reducing the incidence of temporary employment are used to estimate the effect of permanent employment on one aspect of effort absenteeism results suggest that being employed on a permanent contract increases the probability of being absent from work due to sickness by approximately 5 3 percentage points and the time absent by approximately 0 30 of a day per week these results suggest that cross country differences in employment protection have the potential to have a substantial impact on labor productivity

inventory rationing in a make to stock production system with several demand classes and lost sales this paper considers the stock rationing problem of a single item make to stock production system with several demand classes and lost sales for the case of poisson demands and exponential production times we show that the optimal policy can be characterized by a sequence of monotone stock rationing levels for each demand class there exists a stock rationing level at or below which it is optimal to start rejecting the demand of this class in anticipation of future arrival of higher priority demands a simple queueing model is analyzed to compute the operating cost of a rationing policy in a numerical study we compare the optimal rationing policy with a first come first served policy to investigate the benefit of stock rationing under different operating conditions of the system

optimal policy structure characterization for a two period dual sourcing inventory control model with forecast updating a proposed single product stochastic two period inventory control model combines demand forecast updating with the flexibility of two supply sources demand is modeled by two independent random variables over a two period selling season at the beginning of the first period two quantities are ordered using two different supply options a local supplier who delivers the ordered quantity immediately and a second supplier who delivers the ordered quantity at the beginning of the second period the local supplier charges a higher cost per ordered unit the model considers an initial inventory so the decision maker has an opportunity at the beginning of the first period to return part of the available inventory to the supplier or sell it in a parallel market at the end of the first period any unsatisfied demand is backlogged to be satisfied in the next period at the beginning of the second period exogenous market information updates the second period demand forecast according to this updated forecast and the actual inventory level an additional quantity is ordered using the local procurement source or another quantity is returned to the supplier or sold in a parallel market with a dynamic programming approach this research exhibits the structure of the optimal policy characterized by order up to and salvage up to levels the findings provide the structure of the second period conditional optimal policy and analytical insights that characterize the first period optimal policy furthermore a numerical study reveals the impact of information quality on the optimal policy and the trade off between the two procurement options

the time frequency dependence of unemployment on real input prices a wavelet coherency and partial coherency approach abstractwhile the dependence of unemployment on real oil price and real interest rate is an important issue that has been addressed only in the time dimension little is known about the movements o

the flexibility of the workweek in the united states evidence from the fifa world cup i introduction at any given time an american worker should benefit from some flexibility in his workweek schedule there are events whose timing overlaps with the workday and if these events are valued by the worker consuming them will increase the quality of the worker s leisure the possibility to reschedule his work hours and consume a given event will result in higher worker s utility perhaps the worker knows ahead of time when this event will occur and plans accordingly for example during the national collegiate athletic association ncaa tournaments in march saint patrick s day also in march or the presidential inauguration in january alternatively the worker will equally benefit from some work flexibility in the face of an event that is unpredictable such as bad weather a natural disaster or a sick child at home even though weekly schedule flexibility is important and valued by workers it is not clear whether workers adjust their work schedule in the face of an event that overlaps with the workday especially if consuming the event results in higher workers utility while workers weekly schedule flexibility has remained relatively unexplored economists have paid considerable attention to the market hours of american workers for example costa 2000 analyzes the evolution of the workday length of the average american male between 1890 and 1991 coleman and pencavel 1993a 1993b analyze the evolution of hours worked by american workers between 1940 and 1988 and kuhn and lozano 2008 analyze the evolution of the length of the workweek of american workers between 1979 and 2006 similarly economists have been interested in understanding the tradeoff between leisure and paid labor recent research includes connolly 2008 who shows that weather determines a worker s day to day allocation of market hours as workers work longer hours during rainy days or gonzalez chapela 2007 who shows that as prices of recreation goods complements of leisure increase american workers hours of work increase as well a natural extension is to ask whether workers would decrease their hours of labor in the face of an event that overlaps with the workweek if workers value of leisure increases from consuming such event then it is conceivable that they would choose to consume it rather than work at the time of the event in this paper i explore the workweek s schedule flexibility of american workers during the last 15 years using the exogenous variation that arises due to the format of fifa soccer world cup 1 that is unlike events that cater to the american public and may be scheduled at times when americans reduce their work hours anyway the world cup game schedule and host country choice is determined mostly independently from the united states labor market or the preferences of american workers further as each world cup is hosted by a different country and played every 4 years the time games are broadcast live in america may or may not overlap with the workday depending on the host country where the world cup is played this allows me to estimate the causal effect that the world cup has on changes in a worker s weekly schedule flexibility from three independent sources of variation across time comparing year t with year t i i 1 2 3 across space the host country will determine the time games are broadcast live in the united states lastly the third source of variation is the time games are broadcast live in each u s time zone as each match broadcast s scheduled time will differ across different time zones potentially the same game will overlap with the workday in a time zone within the united states and not in other time zones empirically i compare deviations in a worker s weekly work hours during the world cup from his usual work schedule with the deviations from the usual workweek of a demographically equivalent worker at other times importantly and as argued above games played in different countries are televised live at different local times and the times that these games are televised locally will determine whether the timing of the world cup overlaps with the worker s regular work schedule in each u

does raising the school leaving age reduce teacher effort evidence from a policy experiment this paper examines the impact of an increase in the school leaving age on high school teachers absence behaviour we estimate differ ence in difference models of absenteeism using count data approaches employing data from the spanish labour force survey our findings suggest that high school teachers reduced their effort due to the re form that raised the age of compulsory education commencing in the academic year 1998 1999 in spain in particular they take 15 more sickness absence in the posttreatment period this result should be of interest to both policy makers and researchers who rely upon com pulsory school law changes as a source of exogenous variation in edu cational attainment

is soccer good for you the motivational impact of big sporting events on the unemployed we examine the effect of salient international soccer tournaments on the motivation of unemployed individuals to search for employment using the german socio economic panel 1984 2010 exploiting the random scheduling of survey interviews we find significant effects on motivational variables such as the intention to work or the reservation wage furthermore the sporting events increase perceived health as well as worries about the general economic situation

inventory policies for systems with stochastic and deterministic demand we consider a periodic review inventory system with demand arriving simultaneously from a deterministic source and a random source the deterministic demand has to be satisfied immediately and the stochastic demand can be backordered assuming that the stochastic demand is never backlogged if there is stock in the system we prove that a modified s s policy is optimal under general conditions if there is a setup cost if there is a smoothing cost instead of the setup cost we observe that the problem corresponds to a standard model with one source of demand

here comes the rain again weather and the intertemporal substitution of leisure i revisit the intertemporal labor supply framework using exogenous variations in daily weather to see how time at work varies with rain in my model a rainy day is associated with a lower enjoyment of leisure effectively increasing wages and bringing more hours at work i test the model using data from the american time use survey supplemented with daily weather i find that on rainy days men shift on average 30 minutes from leisure to work computations give a rough estimate of the intertemporal elasticity of labor supply of around 0 01 in line with the rest of the literature

dynamic pricing in the presence of inventory considerations research overview current practices and future directions the benefits of dynamic pricing methods have long been known in industries such as airlines hotels and electric utilities where the capacity is fixed in the short term and perishable in recent years there has been an increasing adoption of dynamic pricing policies in retail and other industries where the sellers have the ability to store inventory three factors contributed to this phenomenon 1 the increased availability of demand data 2 the ease of changing prices due to new technologies and 3 the availability of decision support tools for analyzing demand data and for dynamic pricing this paper constitutes a review of the literature and current practices in dynamic pricing given its applicability in most markets and its increasing adoption in practice our focus is on dynamic intertemporal pricing in the presence of inventory considerations

using imperfect advance demand information in ordering and rationing decisions in this paper we consider an inventory problem with two demand classes having different priorities the appropriate policy of rationing the available stock i e reserving some stock for meeting prospective future demand of preferred customers at the expense of deliberately losing some of the currently materialized demand of lower demand class es relies on the estimation of the future demand utilizing current signals on future demand which we refer to as imperfect advance demand information adi decreases uncertainty on future demand and may help to make better decisions on when to start rejecting lower class demand we develop a model that incorporates imperfect adi with inventory ordering replenishment decision and rationing available stock in a two period setting we show some structural properties solve the rationing problem and propose solution methods based on monte carlo simulation for the ordering problem we conduct numerical tests to measure the impact of system parameters on the expected value of imperfect adi and provide useful managerial insights

adaptive inventory control for nonstationary demand and partial information this paper examines several different policies for an inventory control problem in which the demand process is nonstationary and partially observed the probability distribution for the demand in each period is determined by the state of a markov chain the core process however the state of this core process is not directly observed only the actual demand is observed by the decision maker given this demand process the inventory control problem is a composite state partially observed markov decision process pomdp which is an appropriate model for a number of dynamic demand problems in practice managers often use certainty equivalent control cec policies to solve such a problem however this paper presents results that demonstrate that there are other practical control policies that almost always provide much better solutions for this problem than the cec policies commonly used in practice the computational results also indicate how specific problem characteristics influence the performance of each of the alternative policies