Search results for: share pricing

Authors: Gaosheng Ju

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Our empirical evidence supports a model of consumption planning behaviors with the following two characteristics. First, households formulate a rational consumption target based on their desired target, displaying a diminishing sensitivity to the discrepancy between them. Second, the established target is a reference point for their planned consumption. The diminishing sensitivity leads to opposite reactions in higher and lower quantiles of both consumption targets and consumption growth to changes in economic conditions. This phenomenon accounts for the perplexingly low correlation between consumption and other macroeconomic variables. Furthermore, the opposing movements of consumption targets offer new insights into consumption-based asset pricing.

Keywords: consumption planning, reference point, diminishing sensitivity, quantile regression, asset pricing puzzles

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Authors: Lidia Sanchis-Marco, Antonio Rubia, Pedro Serrano

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This paper studies the informational content of pricing errors in the term structure of sovereign CDS spreads. The residuals from a non-arbitrage model are employed to construct a Price discrepancy estimate, or noise measure. The noise estimate is understood as an indicator of market distress and reflects frictions such as illiquidity. Empirically, the noise measure is computed for an extensive panel of CDS spreads. Our results reveal an important fraction of systematic risk is not priced in default swap contracts. When projecting the noise measure onto a set of financial variables, the panel-data estimates show that greater price discrepancies are systematically related to a higher level of offsetting transactions of CDS contracts. This evidence suggests that arbitrage capital flows exit the marketplace during time of distress, and this consistent with a market segmentation among investors and arbitrageurs where professional arbitrageurs are particularly ineffective at bringing prices to their fundamental values during turbulent periods. Our empirical findings are robust for the most common CDS pricing models employed in the industry.

Keywords: credit default swaps, noise measure, illiquidity, capital arbitrage

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Authors: Pradyumna Mohanty

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The paper aims to explore whether accounting information of Indian companies in the Steel sector are value relevant or not. Ohlson’s model which usually takes into consideration book value per share (BV) and earnings per share (EARN) has been used and the same has been expanded to include two more variables such as cash flow from operations (CFO) and return on equity (ROE). The data were collected from CMIE-Prowess data base in respect of BSE-listed steel companies and the time frame spans from 2010 to 2014. OLS regression has been used to test the value relevance of these accounting numbers. Results indicate that both CFO and BV are having significant influence on the stock price in two out of five years of study. But, BV is emerging as the most significant and highly value relevant of all the four variables during the entire period of study.

Keywords: value relevance, accounting information, book value per share, earnings per share

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Authors: Chenhong Peng

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Beijing, the capital city of China, is running out of water. The water resource per capita in Beijing is only 106 cubic meter, accounts for 5% of the country’s average level and less than 2% of the world average level. The tension between water supply and demand is extremely serious. For one hand, the surface and ground water have been over-exploited during the last decades; for the other hand, water demand keep increasing as the result of population and economic growth. There is a massive gap between water supply and demand. This paper will focus on addressing the water shortage in Beijing city by increasing water use efficiency in domestic sector. First, we will emphasize on the changing structure of water supply and demand in Beijing under the economic development and restructure during the last decade. Second, by analyzing the water use efficiency in agriculture, industry and domestic sectors in Beijing, we identify that the key determinant for addressing the water crisis is to increase the water use efficiency in domestic sector. Third, this article will explore the two primary causes for the water use inefficiency in Beijing: The ineffective water pricing policy and the poor water education and communication policy. Finally, policy recommendation will offered to improve the water use efficiency in domestic sector by making and implementing an effective water pricing policy and people-engaged water education and communication policy.

Keywords: Beijing, water use efficiency, domestic sector, water pricing policy, water education policy

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Authors: Saleh Alzahrani, Halim Boussabaine

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The majority of Public Private Partnership (PPP) are developed based on the rationale that the design, construction, operation, and financing of a public project is to be awarded to a private party within a single contractual framework. PPP project risks normally include the development and construction of a new asset as well as its operation for decades. Undoubtedly the most serious consequences of risks during the construction period are price and time overruns. These events are amongst the most broadly used scenarios in value for money analysis risks. The sources of risk change over the life cycle of a PPP project. In traditional procurement, the public sector normally has to cover all price distress from these risks. At least there is plenty evidence to suggest that price distress is a norm in some of the projects that are delivered under traditional procurement. This paper will find the impact of construction risk factors into actual construction price into PPP projects. The paper will present a brief literature review on PPP risk pricing strategies, and then using system dynamics (SD) to analyses of the risks associated with the estimated project price. Based on the finding from these analyses a risk pricing association model is presented and discussed. The paper concludes with thoughts for future research.

Keywords: Public Private Partnership (PPP), Risk, Risk Pricing, System Dynamics (SD), construction price

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Authors: Sarthak Kumar Jena, Chandra Sekhar Mishra, Prabina Rajib

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Purpose: This paper aims to derive undervaluation signal from the insiders trading of Indian companies where the ownership is complex and concentrated, investors protection is weak, and the insider rules and regulations are not stringent like developed country. This study examines the relationship between insider trading with short term and long term abnormal return. The study also examines the relationship between insider trading and the actual share repurchase by the firm. Methodology: A sample of 78 companies over the period 2008-2013 are analyzed in the study due to not availability of insider data in Indian context. For preliminary analysis T-test and Wilcoxon rank sum test is used to find the difference between the insider trading before and after the share repurchase announcement. Tobit model is used to find out whether insider trading influence shares repurchase decisions or not. Return on the basis of market model and buy hold are calculated in the previous year and the following year of share repurchase announcement. Findings: The paper finds that insider trading around share repurchase is more than control firms and there is positive and significant difference in insider buying between the previous year of share buyback announcement and the following year of buyback announcement. Insider buying before share repurchase announcement has a positive influence on share repurchase decisions. We find insider buying has a positive and significant relationship with announcement return, whereas insider selling has a negative significant relationship with announcement return. Actual share repurchase and program completion also depend on insider trading before share repurchase. Research limitation: The study is constrained by the small sample size, so the results should be viewed by keeping this limitation in mind. Originality: The paper is to our best knowledge the first study based on Indian context to extend the insider trading literature to share repurchase event and examine insider trading to find out undervaluation signal associated with insider buying.

Keywords: insider trading, buyback, open market share repurchase, signalling

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Authors: Manas Shah

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Black Scholes option pricing model is one of the most important concepts in modern world of computational finance. However, its practical use can be challenging as one of the input parameters must be estimated; implied volatility of the underlying security. The more precisely these values are estimated, the more accurate their corresponding estimates of theoretical option prices would be. Here, we present a novel model based on Cuckoo Search Optimization (CS) which finds more precise estimates of implied volatility than Particle Swarm Optimization (PSO) and Genetic Algorithm (GA).

Keywords: black scholes model, cuckoo search optimization, particle swarm optimization, genetic algorithm

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Authors: Brent McKenzie, Victoria Taylor

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The use of QR (Quick Response Codes) codes for customer scanning with mobile phones is a rapidly growing trend. The QR code can provide the consumer with product information, user guides, product use, competitive pricing, etc. One sector for QR use has been in retail, through the use of Electronic Shelf Labeling (henceforth, ESL). In Europe, the use of ESL for pricing has been in practice for a number of years but continues to lag in acceptance in North America. Stated concerns include costs as a key constraint, but there is also evidence that consumer acceptance represents a limitation as well. The purpose of this study is to present the findings of a consumer based study to gage the impact on their use in the retail food sector.

Keywords: electronic price labels, consumer behaviour, grocery shopping, mixed methods research

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Authors: Samipraj Mishra

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Despite the successful implementation of community forestry program, a number of pros and cons have been raised on Terai community forestry in the case of lowland locally called Terai region of Nepal, which is climatically belongs to tropical humid and possessed high quality forests in terms of ecology and economy. The study aims to investigate the local pricing strategy of forest products and its impacts on equitable forest benefit sharing, collection of community fund and carrying out livelihood improvement activities. The study was carried out on six community forests revealed that local people have substantially benefited from the community forests. However, being the region is heterogeneous by socio-economic conditions and forest resources have higher economical potential, the decision of low pricing strategy made by the local people have created inequality problems while sharing the forest benefits, and poorly contributed to community fund collection and consequently carrying out limited activities of livelihood improvement. The paper argued that the decision of low pricing strategy of forest products is counter-productive to promote the equitable benefit sharing in the areas of heterogeneous socio-economic conditions with high value forests. The low pricing strategy has been increasing accessibility of better off households at higher rate than poor; as such households always have higher affording capacity. It is also defective to increase the community fund and carry out activities of livelihood improvement effectively. The study concluded that unilateral decentralized forest policy and decision-making autonomy to the local people seems questionable unless their decision-making capacities are enriched sufficiently. Therefore, it is recommended that empowerment of decision-making capacity of local people and their respective institutions together with policy and program formulation are prerequisite for efficient and equitable community forest management and its long-term sustainability.

Keywords: community forest, livelihood, socio-economy, pricing system, Nepal

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Authors: Laxuman Thakuri

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Despite the large number of in-depth case studies focused on policy analysis, institutional arrangement, and collective action of common property resource management; how the local institutions take the pricing decision of forest products in community forest management and what kinds of effects produce it, the answers of these questions are largely silent among the policy-makers and researchers alike. The study examined how the local institutions take the pricing decision of forest products in the lowland community forestry of Nepal and how the decisions affect to equitable distribution of benefits and livelihood improvement which are also objectives of Nepalese community forestry. The study assumes that forest products pricing decisions have multiple effects on equitable distribution and livelihood improvement in the areas having heterogeneous socio-economic conditions. The dissertation was carried out at four community forests of lowland, Nepal that has characteristics of high value species, matured-experience of community forest management and better record-keeping system of forest products production, pricing and distribution. The questionnaire survey, individual to group discussions and direct field observation were applied for data collection from the field, and Lorenz curve, gini-coefficient, χ²-text, and SWOT (Strong, Weak, Opportunity, and Threat) analysis were performed for data analysis and results interpretation. The dissertation demonstrates that the low pricing strategy of high-value forest products was supposed crucial to increase the access of socio-economically weak households, and to and control over the important forest products such as timber, but found counter productive as the strategy increased the access of socio-economically better-off households at higher rate. In addition, the strategy contradicts to collect a large-scale community fund and carry out livelihood improvement activities as per the community forestry objectives. The crucial part of the study is despite the fact of low pricing strategy; the timber alone contributed large part of community fund collection. The results revealed close relation between pricing decisions and livelihood objectives. The action research result shows that positive price discrimination can slightly reduce the prevailing inequality and increase the fund. However, it lacks to harness the full price of forest products and collects a large-scale community fund. For broader outcomes of common property resource management in terms of resource sustainability, equity, and livelihood opportunity, the study suggests local institutions to harness the full price of resource products with respect to the local market.

Keywords: community, equitable, forest, livelihood, socioeconomic, Nepal

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Authors: Pratheeba Subramanian, Anjula Gurtoo, Mary Mathew

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Transaction of patents in emerging patent markets is gaining momentum. Pricing patents for a transaction say patent sale remains a challenge. Patents vary in their pricing with some patents fetching higher prices than others. Sale of patents in portfolios further complicates pricing with multiple patents playing a role in pricing a bundle. In this paper, a set of 138 US patents sold individually as single invention lots and 462 US patents sold in bundles of 120 portfolios are investigated to understand the dynamics of selling prices of singletons and portfolios and their determinants. Firstly, price variations when patents are sold individually as singletons and portfolios are studied. Multivariate statistical techniques are used for analysis both at the lot level as well as at the individual patent level. The results show portfolios fetching higher prices than singletons at the lot level. However, at the individual patent level singletons show higher prices than per patent price of individual patent members within the portfolio. Secondly, to understand the price determinants, the effect of patent, seller, and bundling related characteristics on selling prices is studied separately for singletons and portfolios. The results show differences in the set of characteristics determining prices of singletons and portfolios. Selling prices of singletons are found to be dependent on the patent related characteristics, unlike portfolios whose prices are found to be dependent on all three aspects – patent, seller, and bundling. The specific patent, seller and bundling characteristics influencing selling price are discussed along with the implications.

Keywords: auction, patents, portfolio bundling, seller type, selling price, singleton

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Authors: Sebastian Luber

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The study demonstrates that tail inflation risk is priced into stock returns and credit spreads. This holds true even when controlling for current and historical inflation moments. The analysis employs inflation caps and floors to obtain the distribution of future inflation under the risk-neutral measure. Credit spreads decrease as the mean and median of future inflation rise, but they respond positively to tail risks. Conversely, stocks serve as a robust hedge against future inflation. Stock returns increase with a higher mean and median of future inflation and rising inflationary tail risk, while they decrease with rising deflationary tail risk.

Keywords: asset pricing, inflation expectations, tail risk, stocks, inflation derivatives, credit

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Authors: Ririh Rahma Ratinghayu, Jayu Pramudya, Nur Aini Masruroh, Shi-Woei Lin

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This research studies pricing strategy in cooperative setting of hotel duopoly selling perishable product under fixed capacity constraint by using the perspective of managers. In hotel revenue management, competitor’s average room rate and occupancy rate should be taken into manager’s consideration in determining pricing strategy to generate optimum revenue. This information is not provided by business intelligence or available in competitor’s website. Thus, Information Sharing (IS) among players might result in improved performance of pricing strategy. IS is widely adopted in the logistics industry, but IS within hospitality industry has not been well-studied. This research put IS as one of cooperative game schemes, besides Mutual Price Setting (MPS) scheme. In off-peak season, hotel manager arranges pricing strategy to offer promotion package and various kinds of discounts up to 60% of full-price to attract customers. Competitor selling homogenous product will react the same, then triggers a price war. Price war which generates lower revenue may be avoided by creating collaboration in pricing strategy to optimize payoff for both players. In MPS cooperative game, players collaborate to set a room rate applied for both players. Cooperative game may avoid unfavorable players’ payoff caused by price war. Researches on horizontal cooperative game in logistics show better performance and payoff for the players, however, horizontal cooperative game in hotel revenue management has not been demonstrated. This paper aims to develop hotel revenue management models under duopoly cooperative schemes (IS & MPS), which are compared to models under non-cooperative scheme too. Each scheme has five models, Capacity Allocation Model; Demand Model; Revenue Model; Optimal Price Model; and Equilibrium Price Model. Capacity Allocation Model and Demand Model employs self-hotel and competitor’s full and discount price as predictors under non-linear relation. Optimal price is obtained by assuming revenue maximization motive. Equilibrium price is observed by interacting self-hotel’s and competitor’s optimal price under reaction equation. Equilibrium is analyzed using game theory approach. The sequence applies for three schemes. MPS Scheme differently aims to optimize total players’ payoff. The case study in which theoretical models are applied observes two hotels offering homogenous product in Indonesia during a year. The Capacity Allocation, Demand, and Revenue Models are built using multiple regression and statistically tested for validation. Case study data confirms that price behaves within demand model in a non-linear manner. IS Models can represent the actual demand and revenue data better than Non-IS Models. Furthermore, IS enables hotels to earn significantly higher revenue. Thus, duopoly hotel players in general, might have reasonable incentives to share information horizontally. During off-peak season, MPS Models are able to predict the optimal equal price for both hotels. However, Nash equilibrium may not always exist depending on actual payoff of adhering or betraying mutual agreement. To optimize performance, horizontal cooperative game may be chosen over non-cooperative game. Mathematical models can be used to detect collusion among business players. Empirical testing can be used as policy input for market regulator in preventing unethical business practices potentially harming society welfare.

Keywords: horizontal cooperative game theory, hotel revenue management, information sharing, mutual price setting

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Authors: Roengchai Tansuchat, Wassanai Wattanutchariya, Aree Wiboonpongse

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Parboiled rice is one of the most important food grains and classified in cereal and cereal product. In 2015, parboiled rice was traded more than 14.34 % of total rice trade. The major parboiled rice export countries are Thailand and India, while many countries in Africa and the Middle East such as Nigeria, South Africa, United Arab Emirates, and Saudi Arabia, are parboiled rice import countries. In the global rice market, parboiled rice pricing differs from white rice pricing because parboiled rice is semi-processing product, (soaking, steaming and drying) which affects to their color and texture. Therefore, parboiled rice export pricing does not depend only on the trade volume, length of grain, and percentage of broken rice or purity but also depend on their rice seed attributes such as color, whiteness, consistency of color and whiteness, and their texture. In addition, the parboiled rice price may depend on the country of origin, and other attributes, such as certification mark, label, packaging, and sales locations. The objectives of this paper are to study the attributes of parboiled rice sold in different countries and to evaluate the relationship between parboiled rice price in different countries and their attributes by using hedonic pricing model. These results are useful for product development, and marketing strategies development. The 141 samples of parboiled rice were collected from 5 major parboiled rice consumption countries, namely Nigeria, South Africa, Saudi Arabia, United Arab Emirates and Spain. The physicochemical properties and optical properties, namely size and shape of seed, colour (L*, a*, and b*), parboiled rice texture (hardness, adhesiveness, cohesiveness, springiness, gumminess, and chewiness), nutrition (moisture, protein, carbohydrate, fat, and ash), amylose, package, country of origin, label are considered as explanatory variables. The results from parboiled rice analysis revealed that most of samples are classified as long grain and slender. The highest average whiteness value is the parboiled rice sold in South Africa. The amylose value analysis shows that most of parboiled rice is non-glutinous rice, classified in intermediate amylose content range, and the maximum value was found in United Arab Emirates. The hedonic pricing model showed that size and shape are the key factors to determine parboiled rice price statistically significant. In parts of colour, brightness value (L*) and red-green value (a*) are statistically significant, but the yellow-blue value (b*) is insignificant. In addition, the texture attributes that significantly affect to the parboiled rice price are hardness, adhesiveness, cohesiveness, and gumminess. The findings could help both parboiled rice miller, exporter and retailers formulate better production and marketing strategies by focusing on these attributes.

Keywords: hedonic pricing model, optical properties, parboiled rice, physicochemical properties

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Authors: Manisha Dubey, Gaurav Gupta, Anoop Arya

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The demand for power supply increases day by day in developing countries like India henceforth demand of reactive power support in the form of ancillary services provider also has been increased. The multi-line and multi-type Flexible alternating current transmission system (FACTS) controllers are playing a vital role to regulate power flow through the transmission line. Unified power flow controller and interline power flow controller can be utilized to control reactive power flow through the transmission line. In a restructured power system, the demand of such controller is being popular due to their inherent capability. The transmission pricing by using reactive power cost allocation through modified matrix methodology has been proposed. The FACTS technologies have quite costly assembly, so it is very useful to apportion the expenses throughout the restructured electricity industry. Therefore, in this work, after embedding the FACTS devices into load flow, the impact on the costs allocated to users in fraction to the transmission framework utilization has been analyzed. From the obtained results, it is clear that the total cost recovery is enhanced towards the Reactive Power flow through the different transmission line for 5 bus test system. The fair pricing policy towards reactive power can be achieved by the proposed method incorporating FACTS controller towards cost recovery of the transmission network.

Keywords: interline power flow controller, transmission pricing, unified power flow controller, cost allocation

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Authors: Jiahau Guo, Yihe Zhang

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This paper proposes solutions for pricing options on stocks paying discrete dividends in markets with daily price limits. We first extend the intraday density function of Guo and Chang (2020) to a multi-day one and use the framework of Haug et al. (2003) to value European options on stocks paying discrete dividends. Next, we adopt the fast Fourier transform (FFT) to derive accurate and efficient formulae for American options and further employ the three-point Richardson extrapolation to accelerate the computation. Finally, the accuracy of our proposed methods is verified by simulations.

Keywords: daily price limit, discrete dividend, early exercise, fast Fourier transform, multi-day density function, Richardson extrapolation

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Authors: Santi Termprasertsakul, Jakkrich Jearviriyaboonya

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This paper studies the market power and pricing behavior of products in iron and steel industry by investigating the impact of vertical product differentiation (VPD) on exchange rate pass-through (ERPT). Vietnam has become one of the major trading partners of Thailand since 2017. The iron and steel export value to Vietnam is more than $300 million a year. Particularly, the average growth rate of importing iron and steel is approximately 30% per year. The VPD is applied to analyze the quality difference of iron and steel between Thailand and Vietnam. The 20 products in iron and steel industry are investigated. The monthly pricing behavior of Harmonized Commodity Description and Coding System 4-digit products is observed from 2010 to 2019. The Nonlinear Autoregressive Distributed Lag is also used to analyze the asymmetry of ERPT in this paper. The empirical results basically reveal an incomplete pass-through between Thai Baht and Vietnamese Dong. The ERPT also varies with the degree of VPD. The product with higher VPD, indicating higher unit values, has higher ERPT. This result suggests the higher market power of the Thai iron and steel industry. In addition, the asymmetry of ERPT exists.

Keywords: exchange rate pass-through, iron and steel industry, pricing behavior, vertical product differentiation

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Authors: Despina Yiakoumi, Agathe Rouaix

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Laboratory experiments were run to investigate the impact of different design characteristics of the auctions, which have been implemented to procure capacity in the UK’s reformed electricity markets. The experiment studies competition among bidders in procurement multi-unit discrete descending clock auctions under different feedback policies and pricing rules. Theory indicates that feedback policy in combination with the two common pricing rules; last-accepted bid (LAB) and first-rejected bid (FRB), could affect significantly the auction outcome. Two information feedback policies regarding the bidding prices of the participants are considered; with feedback and without feedback. With feedback, after each round participants are informed of the number of items still in the auction and without feedback, after each round participants have no information about the aggregate supply. Under LAB, winning bidders receive the amount of the highest successful bid and under the FRB the winning bidders receive the lowest unsuccessful bid. Based on the theoretical predictions of the alternative auction designs, it was decided to run three treatments. First treatment considers LAB with feedback; second treatment studies LAB without feedback; third treatment investigates FRB without feedback. Theoretical predictions of the game showed that under FRB, the alternative feedback policies are indifferent to the auction outcome. Preliminary results indicate that LAB with feedback and FRB without feedback achieve on average higher clearing prices in comparison to the LAB treatment without feedback. However, the clearing prices under LAB with feedback and FRB without feedback are on average lower compared to the theoretical predictions. Although under LAB without feedback theory predicts the clearing price will drop to the competitive equilibrium, experimental results indicate that participants could still engage in cooperative behavior and drive up the price of the auction. It is showed, both theoretically and experimentally, that the pricing rules and the feedback policy, affect the bidding competitiveness of the auction by providing opportunities to participants to engage in cooperative behavior and exercise market power. LAB without feedback seems to be less vulnerable to market power opportunities compared to the alternative auction designs. This could be an argument for the use of LAB pricing rule in combination with limited feedback in the UK capacity market in an attempt to improve affordability for consumers.

Keywords: descending clock auctions, experiments, feedback policy, market design, multi-unit auctions, pricing rules, procurement auctions

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Authors: Akshit Singhal, Xuan Wang, Zhijun Wang, Hao Che, Hong Jiang

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Multiple Path Transmission Control Protocols (MPTCPs) allow flows to explore path diversity to improve the throughput, reliability and network resource utilization. However, the existing solutions may discourage users to adopt the solutions in the face of multipath scenario where different paths are charged based on different pricing structures, e.g., WiFi vs cellular connections, widely available for mobile phones. In this paper, we propose a Hybrid MPTCP (H-MPTCP) with a built-in mechanism to incentivize users to use multiple paths with different pricing structures. In the meantime, H-MPTCP preserves the nice properties enjoyed by the state-of-the-art MPTCP solutions. Extensive real Linux implementation results verify that H-MPTCP can indeed achieve the design objectives.

Keywords: network, TCP, WiFi, cellular, congestion control

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Authors: M. F. Wu, F. T. Cheng, C. S. Wu, M. C. Tan

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It is a critical time to upgrade technology and increase value added with manufacturing skills developing and management strategies that will highly satisfy the customers need in the precision machinery global market. In recent years, the supply side, each precision machinery manufacturers in each country are facing the pressures of price reducing from the demand side voices that pushes the high-end precision machinery manufacturers adopts low-cost and high-quality strategy to retrieve the market. Because of the trend of the global market, the manufacturers must take price reducing strategies and upgrade technology of low-end machinery for differentiations to consolidate the market. By using six key success factors (KSFs), customer perceived value, customer satisfaction, customer service, product design, product effectiveness and machine structure quality are causal conditions to explore the impact of competitive advantage of the enterprise, such as overall profitability and product pricing power. This research uses key success paths (KSPs) approach and f/s QCA software to explore various combinations of causal relationships, so as to fully understand the performance level of KSFs and business objectives in order to achieve competitive advantage. In this study, the combination of a causal relationships, are called Key Success Paths (KSPs). The key success paths guide the enterprise to achieve the specific outcomes of business. The findings of this study indicate that there are thirteen KSPs to achieve the overall profitability, sixteen KSPs to achieve the product pricing power and seventeen KSPs to achieve both overall profitability and pricing power of the enterprise. The KSPs provide the directions of resources integration and allocation, improve utilization efficiency of limited resources to realize the continuous vision of the enterprise.

Keywords: precision machinery industry, key success factors (KSFs), key success paths (KSPs), overall profitability, product pricing power, competitive advantages

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Authors: Brenda R. Berca, Jessica S. Vieira, Lucas G. Candido, Matheus C. Ferreira, Paulo S. A. Lopes Filho, Rafaella O. Baracho

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This study aims to estimate the economic value environmental services sustained by Flamboyant Lourival Louza Municipal Park in Goiânia, Goiás, Brazil. The Flamboyant Park is one of the most relevant urban parks, and it is located near a stadium, a shopping center, and two supercenters. In order to define the methods used for the valuation of Flamboyant Park, the first step was carrying out bibliographical research with the view to better understand which method is most feasible to valuate the Park. Thus, the following direct methods were selected: travel cost, hedonic pricing, and contingent valuation. In addition, an indirect method (replacement cost) was applied at Flamboyant Park. The second step was creating and applying two surveys. The first survey aimed at the visitors of the park, addressing socio-economic issues, the use of the Park, as well as its importance and the willingness the visitors, had to pay for its existence. The second survey was destined to the existing trade in the Park, in order to collect data regarding the profits obtained by them. In the end, the characterization of the profile of the visitors and the application of the methods of contingent valuation, travel cost, replacement cost and hedonic pricing were obtained, thus monetarily valuing the various ecosystem services sustained by the park. Some services were not valued due to difficulties encountered during the process.

Keywords: contingent valuation, ecosystem services, economic environmental valuation, hedonic pricing, travel cost

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Authors: Krishang Surapaneni

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The goal of this project is to determine how to predict important aspects of options, including the ask price. We want to compare different machine learning models to learn the best model and the best hyperparameters for that model for this purpose and data set. Option pricing is a relatively new field, and it can be very complicated and intimidating, especially to inexperienced people, so we want to create a machine learning model that can predict important aspects of an option stock, which can aid in future research. We tested multiple different models and experimented with hyperparameter tuning, trying to find some of the best parameters for a machine-learning model. We tested three different models: a Random Forest Regressor, a linear regressor, and an MLP (multi-layer perceptron) regressor. The most important feature in this experiment is the ask price; this is what we were trying to predict. In the field of stock pricing prediction, there is a large potential for error, so we are unable to determine the accuracy of the models based on if they predict the pricing perfectly. Due to this factor, we determined the accuracy of the model by finding the average percentage difference between the predicted and actual values. We tested the accuracy of the machine learning models by comparing the actual results in the testing data and the predictions made by the models. The linear regression model performed worst, with an average percentage error of 17.46%. The MLP regressor had an average percentage error of 11.45%, and the random forest regressor had an average percentage error of 7.42%

Keywords: finance, linear regression model, machine learning model, neural network, stock price

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Authors: Amit Das

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Background and significance of the study: Generally investors and market forecasters use financial statement for investigation while it awakens contribute to investing. The main vicinity of financial accounting and reporting practices recommends a few basic financial performance indicators, namely, return on capital employed, return on assets and earnings per share, which is associated considerably with share prices. It is principally true in case of Indian pharmaceutical companies also. Share investing is intriguing a financial risk in addition to investors look for those financial evaluations which have noteworthy shock on share price. A crucial intention of financial statement analysis and reporting is to offer information which is helpful predominantly to exterior clients in creating credit as well as investment choices. Sound financial performance attracts the investors automatically and it will increase the share price of the respective companies. Keeping in view of this, this research work investigates the impact of financial performance indicators on share price of pharmaceutical companies in India which is listed in the Bombay Stock Exchange. Methodology: This research work is based on secondary data collected from moneycontrol database on September 28, 2015 of top 101 pharmaceutical companies in India. Since this study selects four financial performance indicators purposively and availability in the database, that is, earnings per share, return on capital employed, return on assets and net profits as independent variables and one dependent variable, share price of 101 pharmaceutical companies. While analysing the data, correlation statistics, multiple regression technique and appropriate test of significance have been used. Major findings: Correlation statistics show that four financial performance indicators of 101 pharmaceutical companies are associated positively and negatively with its share price and it is very much significant that more than 80 companies’ financial performances are related positively. Multiple correlation test results indicate that financial performance indicators are highly related with share prices of the selected pharmaceutical companies. Furthermore, multiple regression test results illustrate that when financial performances are good, share prices have been increased steadily in the Bombay stock exchange and all results are statistically significant. It is more important to note that sensitivity indices were changed slightly through financial performance indicators of selected pharmaceutical companies in India. Concluding statements: The share prices of pharmaceutical companies depend on the sound financial performances. It is very clear that share prices are changed with the movement of two important financial performance indicators, that is, earnings per share and return on assets. Since 101 pharmaceutical companies are listed in the Bombay stock exchange and Sensex are changed with this, it is obvious that Government of India has to take important decisions regarding production and exports of pharmaceutical products so that financial performance of all the pharmaceutical companies are improved and its share price are increased positively.

Keywords: financial performance indicators, share prices, pharmaceutical companies, India

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Authors: Clarinda Vitorino Nhangumbe, Fredericks Ebrahim, Betuel Canhanga

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The price of an option weather derivatives can be approximated as a solution of the two-dimensional convection-diffusion dominant partial differential equation derived from the Ornstein-Uhlenbeck process, where one variable represents the weather dynamics and the other variable represent the underlying weather index. With appropriate financial boundary conditions, the solution of the pricing equation is approximated using a nonstandard finite difference method. It is shown that the proposed numerical scheme preserves positivity as well as stability and consistency. In order to illustrate the accuracy of the method, the numerical results are compared with other methods. The model is tested for real weather data.

Keywords: nonstandard finite differences, Ornstein-Uhlenbeck process, partial differential equations approach, weather derivatives

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Authors: Masoud Rabbani, Majede Smizadeh, Hamed Farrokhi-Asl

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We study jointly determining prices and production in a multiple period horizon under a general non-stationary stochastic demand with continuous prices. In some periods we need to increase capacity of production to satisfy demand. This paper presents a model to aid multi-period production capacity planning by quantifying the trade-off between product quality and production cost. The product quality is estimated as the statistical variation from the target performances obtained from the output tolerances of the production machines that manufacture the components. We consider different tolerance for different machines that use to increase capacity. The production cost is estimated as the total cost of owning and operating a production facility during the planning horizon.so capacity planning has cost that impact on price. Pricing products often turns out to be difficult to measure them because customers have a reservation price to pay that impact on price and demand. We decide to determine prices and production for periods after enhance capacity and consider reservation price to determine price. First we use an algorithm base on fuzzy set of the optimal objective function values to determine capacity planning by determine maximize interval from upper bound in minimum objectives and define weight for objectives. Then we try to determine inventory and pricing policies. We can use a lemma to solve a problem in MATLAB and find exact answer.

Keywords: price policy, inventory policy, capacity planning, product quality, epsilon -constraint

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Authors: Maryam Ghoreishi, Christian Larsen

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In this paper, we investigate the effect of stochastic inputs on problem of joint optimal pricing and lot-sizing decisions where the inventory cycle is divided into advance and spot sales periods. During the advance sales period, customer can make reservations while customer with reservations can cancel their order. However, during the spot sales period customers receive the order as soon as the order is placed, but they cannot make any reservation or cancellation during that period. We assume that the inter arrival times during the advance sales and spot sales period are exponentially distributed where the arrival rate is decreasing function of price. Moreover, we assume that the number of cancelled reservations is binomially distributed. In addition, we assume that deterioration process follows an exponential distribution. We investigate two cases. First, we consider two-state case where we find the optimal price during the spot sales period and the optimal price during the advance sales period. Next, we develop a generalized case where we extend two-state case also to allow dynamic prices during the spot sales period. We apply the Markov decision theory in order to find the optimal solutions. In addition, for the generalized case, we apply the policy iteration algorithm in order to find the optimal prices, the optimal lot-size and maximum advance sales amount.

Keywords: inventory control, pricing, Markov decision theory, advance sales system

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Authors: Delio I. Castaneda, Paul Toulson

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The purpose of this study was to investigate the knowledge sharing effectiveness of two types of knowledge, tacit and explicit, depending on two channels: face to face or digital. Participants were 217 knowledge workers in New Zealand and researchers who attended a knowledge management conference in the United Kingdom. In the study, it was found that digital tools are effective to share explicit knowledge. In addition, digital tools that facilitated dialogue were effective to share tacit knowledge. It was also found that face to face communication was an effective way to share tacit and explicit knowledge. Results of this study contribute to clarify in what cases digital tools are effective to share tacit knowledge. Additionally, even though explicit knowledge can be easily shared using digital tools, this type of knowledge is also possible to be shared through dialogue. Result of this study may support practitioners to redesign programs and activities based on knowledge sharing to make strategies more effective.

Keywords: digital knowledge, explicit knowledge, knowledge sharing, tacit knowledge

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Authors: Mehdi Seifbarghy, Zahra Nasiri

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Competitive location problem deals with locating new facilities to provide a service (or goods) to the customers of a given geographical area where other facilities (competitors) offering the same service are already present. The new facilities will have to compete with the existing facilities for capturing the market share. This paper proposes a new model to maximize the market share in which customers choose the facilities based on traveling time, waiting time and attractiveness. The attractiveness of a facility is considered as a parameter in the model. A heuristic is proposed to solve the problem.

Keywords: competitive location, market share, facility attractiveness, heuristic

Procedia PDF Downloads 524

Authors: O. Benabdeljelil, A. Karioun, S. Amami, R. Rouger, M. Hamidine

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A model for preventing the risks related to climate conditions in the agricultural sector is presented. It will determine the yearly optimum premium to be paid by a producer in order to reach his required turnover. The model is based on both climatic stability and 'soft' responses of usually grown species to average climate variations at the same place and inside a safety ball which can be determined from past meteorological data. This allows the use of linear regression expression for dependence of production result in terms of driving meteorological parameters, the main ones of which are daily average sunlight, rainfall and temperature. By simple best parameter fit from the expert table drawn with professionals, optimal representation of yearly production is determined from records of previous years, and yearly payback is evaluated from minimum yearly produced turnover. The model also requires accurate pricing of commodity at N+1. Therefore, a pricing model is developed using 3 state variables, namely the spot price, the difference between the mean-term and the long-term forward price, and the long-term structure of the model. The use of historical data enables to calibrate the parameters of state variables, and allows the pricing of commodity. Application to beet sugar underlines pricer precision. Indeed, the percentage of accuracy between computed result and real world is 99,5%. Optimal premium is then deduced and gives the producer a useful bound for negotiating an offer by insurance companies to effectively protect its harvest. The application to beet production in French Oise department illustrates the reliability of present model with as low as 6% difference between predicted and real data. The model can be adapted to almost any agricultural field by changing state parameters and calibrating their associated coefficients.

Keywords: agriculture, production model, optimal price, meteorological factors, 3-factor model, parameter calibration, forward price

Procedia PDF Downloads 377

Authors: Dwi Ashari

Abstract:

This study attempts to disclose people’s privacy in Indonesian media. Many television (henceforth: TV) programs have shown the exposure of people’s privacy. People, not only celebrities, who appear in TV program often, share their life to the participants to get very intimate self-disclosure with them. Indonesia, as one of the countries with highest population, has many people who watch television everyday. This can be the major factor for some TV stations to create a program to get people’s attention to gain more profit. This study examines some factors of Indonesia TV programs that share the people’s privacy. The relation of privacy in Indonesia TV programs will be related to the concept of self-disclosure and intimacy between the people who share and watch the programs.

Keywords: Indonesia, media, privacy, self-disclosure

Procedia PDF Downloads 337