pwc-archive/papers-with-abstracts huggingface dataset:
Hypergraph Animals
Authors: Michael P. H. Stumpf
Date: 2023-04-03 00:00:00

Here we introduce simple structures for the analysis of complex hypergraphs, hypergraph animals. These structures are designed to describe the local node neighbourhoods of nodes in hypergraphs. We establish their relationships to lattice animals and network motifs, and we develop their combinatorial properties for sparse and uncorrelated hypergraphs. We make use of the tight link of hypergraph animals to partition numbers, which opens up a vast mathematical framework for the analysis of hypergraph animals. We then study their abundances in random hypergraphs. Two transferable insights result from this analysis: (i) it establishes the importance of high-cardinality edges in ensembles of random hypergraphs that are inspired by the classical Erd\"os-Reny\'i random graphs; and (ii) there is a close connection between degree and hyperedge cardinality in random hypergraphs that shapes animal abundances and spectra profoundly. Both findings imply that hypergraph animals can have the potential to affect information flow and processing in complex systems. Our analysis of also suggests that we need to spend more effort on investigating and developing suitable conditional ensembles of random hypergraphs that can capture real-world structures and their complex dependency structures.
Sequential epidemic spread between agglomerates of self-propelled agents in one dimension
Authors: Pablo de Castro, Felipe Urbina, Ariel Norambuena, Francisca Guzmán-Lastra
Date: 2023-03-30 00:00:00

Motile organisms can form stable agglomerates such as cities or colonies. In the outbreak of a highly contagious disease, the control of large-scale epidemic spread depends on factors like the number and size of agglomerates, travel rate between them, and disease recovery rate. While the emergence of agglomerates permits early interventions, it also explains longer real epidemics. In this work, we study the spread of susceptible-infected-recovered epidemics in one-dimensional spatially-structured systems. By working in one dimension, we mimic microorganisms in narrow channels and establish a necessary foundation for future investigation in higher dimensions. We employ a model of self-propelled particles which spontaneously form multiple clusters. As the rate of stochastic reorientation decreases, clusters become larger and less numerous. Besides examining the time evolution averaged over many epidemics, we show how the final number of ever-infected individuals depends non-trivially on single-individual parameters. In particular, the number of ever-infected individuals first increases with the reorientation rate since particles escape sooner from clusters and spread the disease. For higher reorientation rate, travel between clusters becomes too diffusive and the clusters too small, decreasing the number of ever-infected individuals.
Gaussian Anamorphosis for Ensemble Kalman Filter Analysis of SAR-Derived Wet Surface Ratio Observations
Authors: Thanh Huy Nguyen, Sophie Ricci, Andrea Piacentini, Ehouarn Simon, Raquel Rodriguez Suquet, Santiago Peña Luque
Date: 2023-04-03 00:00:00
Tasks: Earth Observation

Flood simulation and forecast capability have been greatly improved thanks to advances in data assimilation (DA) strategies incorporating various types of observations; many are derived from spatial Earth Observation. This paper focuses on the assimilation of 2D flood observations derived from Synthetic Aperture Radar (SAR) images acquired during a flood event with a dual state-parameter Ensemble Kalman Filter (EnKF). Binary wet/dry maps are here expressed in terms of wet surface ratios (WSR) over a number of subdomains of the floodplain. This ratio is further assimilated jointly with in-situ water-level observations to improve the flow dynamics within the floodplain. However, the non-Gaussianity of the observation errors associated with SAR-derived measurements break a major hypothesis for the application of the EnKF, thus jeopardizing the optimality of the filter analysis. The novelty of this paper lies in the treatment of the non-Gaussianity of the SAR-derived WSR observations with a Gaussian anamorphosis process (GA). This DA strategy was validated and applied over the Garonne Marmandaise catchment (South-west of France) represented with the TELEMAC-2D hydrodynamic model, first in a twin experiment and then for a major flood event that occurred in January-February 2021. It was shown that assimilating SAR-derived WSR observations, in complement to the in-situ water-level observations significantly improves the representation of the flood dynamics. Also, the GA transformation brings further improvement to the DA analysis, while not being a critical component in the DA strategy. This study heralds a reliable solution for flood forecasting over poorly gauged catchments thanks to available remote-sensing datasets.
Using neuronal models to capture burst and glide motion and leadership in fish
Authors: Linnéa Gyllingberg, Alex Szorkovszky, David J. T. Sumpter
Date: 2023-04-03 00:00:00

While mathematical models, in particular self-propelled particle (SPP) models, capture many of the observed properties of large fish schools, they do not always capture the interactions of smaller shoals. Nor do these models tend to account for the observation that, when swimming alone or in smaller groups, many species of fish use intermittent locomotion, often referred to as burst and coast or burst and glide. Recent empirical studies have suggested that burst and glide movement is indeed pivotal to the social interactions of individual fish. In this paper, we propose a model of social burst and glide motion by combining a well-studied model of neuronal dynamics, the FitzHugh-Nagumo model, with a model of fish motion. We begin by showing that the model can capture the motion of a single fish swimming down a channel. By then extending to a two fish model, where visual stimuli of the position of the other fish affect the internal burst or glide state of the fish, we find that our model captures a rich set of swimming dynamics found in many species of fish. These include: leader-follower behaviour; periodic changes in leadership; apparently random (i.e. chaotic) leadership change; and pendulum-like tit-for-tat turn taking. Unlike SPP models, which assume that fish move at a constant speed, the model produces realistic motion of individual fish. Moreover, unlike previous studies where a random component is used for leadership switching to occur, we show that leadership switching, both periodic and chaotic, can be the result of a deterministic interaction. We give several empirically testable predictions on how fish interact and discuss our results in light of recently established correlations between fish locomotion and brain activity.
Reconstructing firm-level input-output networks from partial information
Authors: Andrea Bacilieri, Pablo Austudillo-Estevez
Date: 2023-03-31 00:00:00

There is a large consensus on the fundamental role of firm-level supply chain networks in macroeconomics. However, data on supply chains at the fine-grained, firm level are scarce and frequently incomplete. For listed firms, some commercial datasets exist but only contain information about the existence of a trade relationship between two companies, not the value of the monetary transaction. We use a recently developed maximum entropy method to reconstruct the values of the transactions based on information about their existence and aggregate information disclosed by firms in financial statements. We test the method on the administrative dataset of Ecuador and reconstruct a commercial dataset (FactSet). We test the method's performance on the weights, the technical and allocation coefficients (microscale quantities), two measures of firms' systemic importance and GDP volatility. The method reconstructs the distribution of microscale quantities reasonably well but shows diverging results for the measures of firms' systemic importance. Due to the network structure of supply chains and the sampling process of firms and links, quantities relying on the number of customers firms have (out-degrees) are harder to reconstruct. We also reconstruct the input-output table of globally listed firms and merge it with a global input-output table at the sector level (the WIOD). Differences in accounting standards between national accounts and firms' financial statements significantly reduce the quality of the reconstruction.
Testing for idiosyncratic Treatment Effect Heterogeneity
Authors: Jaime Ramirez-Cuellar
Date: 2023-04-03 00:00:00
Tasks: valid

This paper provides asymptotically valid tests for the null hypothesis of no treatment effect heterogeneity. Importantly, I consider the presence of heterogeneity that is not explained by observed characteristics, or so-called idiosyncratic heterogeneity. When examining this heterogeneity, common statistical tests encounter a nuisance parameter problem in the average treatment effect which renders the asymptotic distribution of the test statistic dependent on that parameter. I propose an asymptotically valid test that circumvents the estimation of that parameter using the empirical characteristic function. A simulation study illustrates not only the test's validity but its higher power in rejecting a false null as compared to current tests. Furthermore, I show the method's usefulness through its application to a microfinance experiment in Bosnia and Herzegovina. In this experiment and for outcomes related to loan take-up and self-employment, the tests suggest that treatment effect heterogeneity does not seem to be completely accounted for by baseline characteristics. For those outcomes, researchers could potentially try to collect more baseline characteristics to inspect the remaining treatment effect heterogeneity, and potentially, improve treatment targeting.
Testing and Identifying Substitution and Complementarity Patterns
Authors: Rui Wang
Date: 2023-04-03 00:00:00

This paper studies semiparametric identification of substitution and complementarity patterns between two goods using a panel multinomial choice model with bundles. The model allows the two goods to be either substitutes or complements and admits heterogeneous complementarity through observed characteristics. I first provide testable implications for the complementarity relationship between goods. I then characterize the sharp identified set for the model parameters and provide sufficient conditions for point identification. The identification analysis accommodates endogenous covariates through flexible dependence structures between observed characteristics and fixed effects while placing no distributional assumptions on unobserved preference shocks. My method is shown to perform more robustly than the parametric method through Monte Carlo simulations. As an extension, I allow for unobserved heterogeneity in the complementarity, investigate scenarios involving more than two goods, and study a class of nonseparable utility functions.
IV Regressions without Exclusion Restrictions
Authors: Wayne Yuan Gao, Rui Wang
Date: 2023-04-02 00:00:00
Tasks: regression

We study identification and estimation of endogenous linear and nonlinear regression models without excluded instrumental variables, based on the standard mean independence condition and a nonlinear relevance condition. Based on the identification results, we propose two semiparametric estimators as well as a discretization-based estimator that does not require any nonparametric regressions. We establish their asymptotic normality and demonstrate via simulations their robust finite-sample performances with respect to exclusion restrictions violations and endogeneity. Our approach is applied to study the returns to education, and to test the direct effects of college proximity indicators as well as family background variables on the outcome.
Implicit Bias against a Capitalistic Society Predicts Market Earnings
Authors: Syngjoo Choi, Kyu Sup Hahn, Byung-Yeon Kim, Eungik Lee, Jungmin Lee, Sokbae Lee
Date: 2023-04-02 00:00:00

This paper investigates whether ideological indoctrination by living in a communist regime relates to low economic performance in a market economy. We recruit North Korean refugees and measure their implicit bias against South Korea by using the Implicit Association Test. Conducting double auction and bilateral bargaining market experiments, we find that North Korean refugees with a larger bias against the capitalistic society have lower expectations about their earning potential, exhibit trading behavior with lower target profits, and earn less profits. These associations are robust to conditioning on correlates of preferences, human capital, and assimilation experiences.
Unemployment and Endogenous Reallocation over the Business Cycle
Authors: Carlos Carrillo-Tudela, Ludo Visschers
Date: 2023-04-02 00:00:00

This paper studies the extent to which the cyclicality of occupational mobility shapes that of aggregate unemployment and its duration distribution. We document the relation between workers' occupational mobility and unemployment duration over the long run and business cycle. To interpret this evidence, we develop a multi-sector business cycle model with heterogenous agents. The model is quantitatively consistent with several important features of the US labor market: procyclical gross and countercyclical net occupational mobility, the large volatility of unemployment and the cyclical properties of the unemployment duration distribution, among many others. Our analysis shows that occupational mobility due to workers; changing career prospects, and not occupation-wide differences, interacts with aggregate conditions to drive the fluctuations of the unemployment duration distribution and the aggregate unemployment rate.
The short- and long-term determinants of fertility in Uruguay
Authors: Zuleika Ferre, Patricia Triunfo, José-Ignacio Antón
Date: 2023-04-02 00:00:00
Tasks: Time Series Analysis

This paper examines the determinants of fertility among women at different stages of their reproductive lives in Uruguay. To this end, we employ time series analysis methods based on data from 1968 to 2021 and panel data techniques based on department-level statistical information from 1984 to 2019. The results of our first econometric exercise indicate a cointegration relationship between fertility and economic performance, education and infant mortality, with differences observed by reproductive stage. We find a negative relationship between income and fertility for women aged 20-29 that persists for women aged 30 and over. This result suggests that having children is perceived as an opportunity cost for women in this age group. We also observe a negative relationship between education and adolescent fertility, which has implications for the design of public policies. A panel data analysis with econometric techniques allowing us to control for unobserved heterogeneity confirms that income is a relevant factor for all groups of women and reinforces the crucial role of education in reducing teenage fertility. We also identify a negative correlation between fertility and employment rates for women aged 30 and above. We outline some possible explanations for these findings in the context of work-life balance issues and argue for the importance of implementing social policies to address them.
The Tech Decoupling
Authors: Monika Baloda
Date: 2023-04-02 00:00:00
Tasks: Time Series

Financial market volatility is a crucial factor for investment planning, option pricing, and financial market regulation, and technology is widely recognized as a key driver of economic growth. In this project, we investigate the co-movement of technology and non-technology sectors over the last two decades. We identify a decoupling phenomenon in the levels and volatility of the two sectors after 2015 and argue that this cannot be attributed to the COVID-19 shock. Furthermore, we demonstrate that the technology sector serves as a leading indicator of growth for the rest of the economy. Using ARIMA modeling and stationarity tests, we process time series data to test our hypotheses, finding that the technology sector follows an ARIMA(3,1,3) model, while the non-technology sector follows an ARIMA(2,1,4) model. Our analysis encompasses data wrangling, pre-processing, missing value treatment, and exploratory data analysis, and we discuss the merits and shortcomings of our work to aid in the interpretation of our results. Overall, our findings shed new light on the relationship between technology and economic growth. Our results can be used for understanding labor market fluctuations in the technology sector and investment planning assessments.
Reduction of Excess Capacity with Response of Capital Intensity
Authors: Samidh Pal
Date: 2023-04-02 00:00:00

Purpose: The objective of this research was to show the response of the potential reduction of excess capacity in terms of capital intensity to the growth rate of labor productivity in the manufacturing industrial sector. Design/Methodology/Approach: The research was carried out in 2019 in 55 groups of Indian manufacturing industry within six major Indian industrial states. Mainly, the research used the modified VES (Variable Elasticity Substitution) estimation model. The research focused on the value of the additional substitution parameter of capital intensity (mu > 0). Findings: Almost all selected industry groups with in six states need capital-intensive production. The results found additional parameter of capital intensity (mu) is greater than zero for all industry groups. It means that a higher product per man can be obtained by increasing the capital per worker. Practical Implications: Research shows that an increasingly need for capital investment in need for higher labor productivity is likely to induce the manufacturing unit to use more capacity in existence. It reveals that investors in these selected six states can increase their capital investment. Originality/Value: The analysis of the result allowed to determine the fact that capital intensity is an essential variable for reduction of excess capacity which cannot be ignored in explaining productivity.
Immigrant assimilation in health care utilisation in Spain
Authors: Zuleika Ferre, Patricia Triunfo, José-Ignacio Antón
Date: 2023-04-02 00:00:00

Abundant evidence has tracked the labour market and health assimilation of immigrants, including static analyses of differences in how foreign-born and native-born residents consume health care services. However, we know much less about how migrants' patterns of health care usage evolve with time of residence, especially in countries providing universal or quasi-universal coverage. We investigate this process in Spain by combining all the available waves of the local health survey, which allows us to separately identify period, cohort, and assimilation effects. We find that the evidence of health assimilation is limited and solely applies to migrant females' visits to general practitioners. Nevertheless, the differential effects of ageing on health care use between foreign-born and native-born populations contributes to the convergence of utilisation patterns in most health services after 20 years in Spain. Substantial heterogeneity over time and by region of origin both suggest that studies modelling future welfare state finances would benefit from a more thorough assessment of migration.
Life cycle costing analysis of deep energy retrofits of a mid-rise building to understand the impact of energy conservation measures
Authors: Haonan Zhang
Date: 2023-04-02 00:00:00

Building energy retrofits have been identified as key to realizing climate mitigation goals in Canada. This study aims to provide a roadmap for existing mid-rise building retrofits in order to understand the required capital investment, energy savings, energy cost savings, and carbon footprint for mid-rise residential buildings in Canada. This study employed EnergyPlus to examine the energy performance of 11 energy retrofit measures for a typical multi-unit residential building (MURB) in Metro Vancouver, British Columbia, Canada. The author employed the energy simulation software (EnergyPlus) to evaluate the pre-and post-retrofit operational energy performance of the selected MURB. Two base building models powered by natural gas (NG-building) and electricity (E-building) were created by SketchUP. The energy simulation results were combined with cost and emission impact data to evaluate the economic and environmental performance of the selected energy retrofit measures. The results indicated that the NG-building can produce significant GHG emission reductions (from 27.64 tCO2e to 3.77 tCO2e) by implementing these energy retrofit measures. In terms of energy savings, solar PV, ASHP, water heater HP, and HRV enhancement have great energy saving potential compared to other energy retrofit measures. In addition, temperature setback, lighting, and airtightness enhancement present the best economic performance from a life cycle perspective. However, windows, ASHP, and solar PV, are not economical choices because of higher life cycle costs. While ASHP can increase life cycle costs for the NG-building, with the financial incentives provided by the governments, ASHP could be the best choice to reduce GHG emissions when stakeholders make decisions on implementing energy retrofits.
The Focal Quantal Response Equilibrium
Authors: Matthew Kovach, Gerelt Tserenjigmid
Date: 2023-04-02 00:00:00

We propose a generalization of Quantal Response Equilibrium (QRE) built on a simple premise: some actions are more focal than others. In our model, which we call the Focal Quantal Response Equilibrium (Focal QRE), each player plays a stochastic version of Nash equilibrium as in the QRE, but some strategies are focal and thus are chosen relatively more frequently than other strategies after accounting for expected utilities. The Focal QRE is able to systemically account for various forms of bounded rationality of players, especially regret-aversion, salience, or limited consideration. The Focal QRE is also useful to explain observed heterogeneity of bounded rationality of players across different games. We show that regret-based focal sets perform relatively well at predicting strategies that are chosen more frequently relative to their expected utilities.
Incentives and Strategic Behaviour: An Experiment
Authors: Teresa Esteban-Casanelles, Duarte Gonçalves
Date: 2023-04-02 00:00:00

How and why do incentive levels affect strategic behaviour? This paper examines an experiment designed to identify the causal effect of scaling up incentives on choices, beliefs, and response times in dominance-solvable games. Higher incentives increase action sophistication and decrease mistake propensity, while beliefs become more accurate, and response times longer. We provide evidence that higher incentives increase cognitive effort, as proxied by longer response times, which in turn is associated with improved performance and predicts choice sophistication and belief accuracy. Overall, the data lend support to both payoff-dependent mistakes and costly reasoning models.