Automated Valuation Services : A case study for Aberdeen in Scotland

Acknowledgements: We are grateful to the three anonymous referees and the editor of the journal for suggestions and comments that helped to improve the paper. We thank seminar participants at the Technische Universit¨at Berlin, Fiona Stoddard, and Verity Watson for helpful comments. The usual disclaimer applies.Peer reviewedPostprin

Property valuation with interpretable machine learning

Property valuation is an important task for various stakeholders, including banks, local authorities, property developers, and brokers. As a result of the characteristics of the real estate market, such as the infrequency of trades, limited supply, negotiated prices, and small submarkets with unique traits, there is no clear market value for properties. Traditionally property valuations are done by expert appraisers. Property valuation can also be done accurately with machine learning methods, but the lack of interpretability with accurate machine learning methods can limit the adoption of those methods. Interpretable machine learning methods could be a solution to this issue, but there are concerns related to the accuracy of these methods. This thesis aims to evaluate the feasibility of interpretable machine learning methods in property valuation by comparing a promising interpretable method to a more complex machine learning method that has had good results in property valuation previously. The promising interpretable method and the well-performed machine learning method are chosen based on previous literature. The two chosen methods, Extreme Gradient Boosting (XGB) and Explainable Boosting Machine (EBM) are compared in terms of prediction accuracy of properties in six big municipalities of Denmark. In addition to the accuracy comparison, the interpretability of the EBM is highlighted. The accuracy of the XGB method is better, even though there are no big differences between the two methods in individual municipalities. The interpretability of the EBM is good, as it is possible to understand, how the model makes predictions in general, and how individual predictions are made

INQUIRIES IN INTELLIGENT INFORMATION SYSTEMS: NEW TRAJECTORIES AND PARADIGMS

Rapid Digital transformation drives organizations to continually revitalize their business models so organizations can excel in such aggressive global competition. Intelligent Information Systems (IIS) have enabled organizations to achieve many strategic and market leverages. Despite the increasing intelligence competencies offered by IIS, they are still limited in many cognitive functions. Elevating the cognitive competencies offered by IIS would impact the organizational strategic positions. With the advent of Deep Learning (DL), IoT, and Edge Computing, IISs has witnessed a leap in their intelligence competencies. DL has been applied to many business areas and many industries such as real estate and manufacturing. Moreover, despite the complexity of DL models, many research dedicated efforts to apply DL to limited computational devices, such as IoTs. Applying deep learning for IoTs will turn everyday devices into intelligent interactive assistants. IISs suffer from many challenges that affect their service quality, process quality, and information quality. These challenges affected, in turn, user acceptance in terms of satisfaction, use, and trust. Moreover, Information Systems (IS) has conducted very little research on IIS development and the foreseeable contribution for the new paradigms to address IIS challenges. Therefore, this research aims to investigate how the employment of new AI paradigms would enhance the overall quality and consequently user acceptance of IIS. This research employs different AI paradigms to develop two different IIS. The first system uses deep learning, edge computing, and IoT to develop scene-aware ridesharing mentoring. The first developed system enhances the efficiency, privacy, and responsiveness of current ridesharing monitoring solutions. The second system aims to enhance the real estate searching process by formulating the search problem as a Multi-criteria decision. The system also allows users to filter properties based on their degree of damage, where a deep learning network allocates damages in 12 each real estate image. The system enhances real-estate website service quality by enhancing flexibility, relevancy, and efficiency. The research contributes to the Information Systems research by developing two Design Science artifacts. Both artifacts are adding to the IS knowledge base in terms of integrating different components, measurements, and techniques coherently and logically to effectively address important issues in IIS. The research also adds to the IS environment by addressing important business requirements that current methodologies and paradigms are not fulfilled. The research also highlights that most IIS overlook important design guidelines due to the lack of relevant evaluation metrics for different business problems

Risks

This book is a collection of feature articles published in Risks in 2020. They were all written by experts in their respective fields. In these articles, they all develop and present new aspects and insights that can help us to understand and cope with the different and ever-changing aspects of risks. In some of the feature articles the probabilistic risk modeling is the central focus, whereas impact and innovation, in the context of financial economics and actuarial science, is somewhat retained and left for future research. In other articles it is the other way around. Ideas and perceptions in financial markets are the driving force of the research but they do not necessarily rely on innovation in the underlying risk models. Together, they are state-of-the-art, expert-led, up-to-date contributions, demonstrating what Risks is and what Risks has to offer: articles that focus on the central aspects of insurance and financial risk management, that detail progress and paths of further development in understanding and dealing with...risks. Asking the same type of questions (which risk allocation and mitigation should be provided, and why?) creates value from three different perspectives: the normative perspective of market regulator; the existential perspective of the financial institution; the phenomenological perspective of the individual consumer or policy holder

Comparing spatial features of urban housing markets:

Various location specific attributes contribute to the spatial dynamics of housing markets. This effect may partly be of a qualitative and discontinuous nature, which causes market segmentation into submarkets. The question however is, whether the most relevant partitioning criteria is directly related to the transaction price of to other, socioeconomic, demographic and physical features of the location. Two neural network techniques are used for analysing statistical house price data from Amsterdam and Helsinki. The analytic hierarchy process is used as a supporting technique. With these techniques it is possible to analyse various dimensions of housing submarket formation. The findings show that, while the price and demand factors have increased in importance, supply factors still prevail as key criteria in both cases. The outcome also indicates that the housing market structure of Amsterdam is more fragmented than that of Helsinki, and that the main discriminating housing market features, and the ways they have changed in time, are somewhat different

Analysis and forecasting of asset quality, risk management and financial stability for the Greek banking system

The increase in non-performing loans (NPLs) during the financial crisis of 2008, which has been converted into a fiscal crisis, as well as the risk of a medium-term increase due to the COVID-19 pandemic has put into question the robustness of many banks and the financial stability of the whole sector. As far as the banking sector is concerned, the management of non-performing loans represents the most significant challenge as their stock reached unprecedented levels, with the deterioration in asset quality being widespread. Addressing the problem of non-performing loans with the assistance of credit risk modeling is important from both a micro and a macro-prudential perspective, since it would not only improve the financial soundness and the capital adequacy of the banking sector, but also free-up funds to be directed to other more productive sectors of the economy. This Thesis extends earlier research by employing a short-term monitoring system with the aim to forecast “failures” i.e. NPL creation. The creation of such a monitoring system allows the risk of a “failure” to change over time, measuring the likelihood of “failure” given the survival time and a set of explanatory variables. The application of Cox proportional hazards models and survival trees to forecast NPLs can be usefully employed in the Greek corporate sectors. The research aim of this thesis consists of two domains: The first aim is the investigation of the determinants that contribute to the NPLs formation. Two GAMLSS models are being tested, a linear GAMLSS model and a nonlinear semi-parametric GAMLSS model which includes smoothing functions that capture potential nonlinear relationships between the explanatory variables to model the parameters favorably. The explanatory variables of the models consist of credit risk variables, macroeconomic variables, bank-specific variables and supervisory and market variables, while the response variable is the non-performing loans. The second aim is to provide answers on whether proportional hazards Cox models and survival tree models can forecast NPLs of loans that are provided in specific corporate sectors in Greece by the use of the most granular data set of corporate borrowers. By evaluating a series of Cox models, a short-term monitoring system has been created with the aim to forecast “failures” i.e. NPL creation. The Cox proportional hazards regression models are incorporating time-to-event, involving a timeline, described by the survival function, indicating the probability that a loan becomes an NPL until time t. The time period counts from the origination of the loan until the “death” of the loan, i.e. its termination, incorporating an “in between” observation point. The event is when the loan is initially being “infected”, i.e. has become NPL. Regarding survival trees, the data set was divided into more subsets, which are easier to model separately and hence yield an improved overall performance. Such models are then beneficial to implement with different machine learning techniques. Predictors (or covariates) are defined as the sectors of the Greek economy and the model is fitted both for the whole sample and for the sample of early terminated loans. The Thesis is organized as follows: Chapter 1 - Introduction addresses the role of banks in financial intermediation, the evolution of credit risk and some issues regarding the Greek banking sector. Chapter 2 constitutes a literature review on research focused on improving the predictive performance of different credit risk assessment methods. Chapter 3 outlines the competitive conditions in the banking sector to demonstrate whether the increase in concentration had affected the competitive conditions in the Greek banking system. In Chapter 4, the funding and the liquidity conditions in the Greek banking sector are being addressed. Chapter 5 contains the selection of aggregate sample, results and analysis of GAMLSS models that have been used for determining NPLs. Chapter 6 provides an introduction to the granular database on Large Exposures, which is used for deriving the panel sample of corporate borrowers whereby models of forecasting and prediction are being employed. Chapter 7 contains the application of Cox models and decision trees, the estimation procedure, parameters, model fit, estimation results and empirical findings. Chapter 8 provides an evaluation and applicability of models as well as the implications for further research. Finally, a conclusion is provided by summarizing my contribution to the research community and my recommendations to the banking industr

Mechanical Engineering

The book substantially offers the latest progresses about the important topics of the "Mechanical Engineering" to readers. It includes twenty-eight excellent studies prepared using state-of-art methodologies by professional researchers from different countries. The sections in the book comprise of the following titles: power transmission system, manufacturing processes and system analysis, thermo-fluid systems, simulations and computer applications, and new approaches in mechanical engineering education and organization systems

Condition monitoring and fault diagnosis of tidal stream turbines subjected to rotor imbalance faults

The main focus of the work presented within this thesis was the testing and development of condition monitoring procedures for detection and diagnosis of HATT rotor imbalance faults. The condition monitoring processes were developed via Matlab with the goal of exploiting generator measurements for rotor fault monitoring. Suitable methods of turbine simulation and testing were developed in order to test the proposed CM processes. The algorithms were applied to both simulation based and experimental data sets which related to both steady-state and non-steady-state turbine operation. The work showed that development of condition monitoring practices based on analysis of data sets generated via CFD modelling was feasible. This could serve as a useful process for turbine developers. The work specifically showed that consideration of the torsional spectra observed in CFD datasets was useful in developing a, ‘rotor imbalance criteria’ which was sensitive to rotor imbalance conditions. Furthermore, based on the CFD datasets acquired it was possible to develop a parametric rotor model which was used to develop rotor torque time series under more general flow conditions. To further test condition monitoring processes and to develop the parametric rotor model developed based on CFD data a scale model turbine was developed. All aspects of data capture and test rig control was developed by the researcher. The test rig utilised data capture within the turbine nose cone which was synchronised with the global data capture clock source. Within the nose cone thrust and moment about one of the turbine blades was measured as well as acceleration at the turbine nose cone. The results of the flume testing showed that rotor imbalance criteria was suitable for rotor imbalance faults as applied to 4 generator quadrature axis current measurements as an analogue for drive train torque measurements. It was further found that feature fusion of the rotor imbalance criterion calculated with power coefficient monitoring was successful for imbalance fault diagnosis. The final part of the work presented was to develop drive train simulation processes which could be calculated in real-time and could be utilised to generate representative datasets under non-steady-state conditions. The parametric rotor model was developed, based on the data captured during flume testing, to allow for non-steady state operation. A number of simulations were then undertaken with various rotor faults simulated. The condition monitoring processes were then applied to the data sets generated. Condition monitoring based on operational surfaces was successful and normalised calculation of the surfaces was outlined. The rotor imbalance criterion was found to be less sensitive to the fault cases under non-steady state condition but could well be suitable for imbalance fault detection rather than diagnosis

Emotional body language synthesis for humanoid robots

Some of the chapters of this thesis are based on research published by the author. Chapter 4 is based on Marmpena M., Lim, A., and Dahl, T. S. (2018). How does the robot feel? Perception of valence and arousal in emotional body language. Paladyn, Journal of Behavioral Robotics, 9(1), 168-182. DOI: https://doi.org/10.1515/pjbr-2018-0012. Chapter 6 is based on Marmpena M., Lim, A., Dahl, T. S., and Hemion, N. (2019). Generating robotic emotional body language with Variational Autoencoders. In Proceedings of the 8th International Conference on Affective Computing and Intelligent Interaction (ACII), pages 545–551. DOI:10.1109/ACII.2019.8925459. Chapter 7 extends Marmpena M., Garcia, F., and Lim, A. (2020). Generating robotic emotional body language of targeted valence and arousal with Conditional Variational Autoencoders. In Companion of the 2020 ACM/IEEE International Conference on Human-Robot Interaction, HRI ’20, page 357–359. DOI: https://doi.org/10.1145/3371382.3378360. The designed or generated robotic emotional body language expressions data presented in this thesis are publicly available: https://github.com/minamar/rebl-pepper-dataIn the next decade, societies will witness a rise in service robots deployed in social environments, such as schools, homes, or shops, where they will operate as assistants, public relation agents, or companions. People are expected to willingly engage and collaborate with these robots to accomplish positive outcomes. To facilitate collaboration, robots need to comply with the behavioural and social norms used by humans in their daily interactions. One such behavioural norm is the expression of emotion through body language. Previous work on emotional body language synthesis for humanoid robots has been mainly focused on hand-coded design methods, often employing features extracted from human body language. However, the hand-coded design is cumbersome and results in a limited number of expressions with low variability. This limitation can be at the expense of user engagement since the robotic behaviours will appear repetitive and predictable, especially in long-term interaction. Furthermore, design approaches strictly based on human emotional body language might not transfer effectively on robots because of their simpler morphology. Finally, most previous work is using six or fewer basic emotion categories in the design and the evaluation phase of emotional expressions. This approach might result in lossy compression of the granularity in emotion expression. The current thesis presents a methodology for developing a complete framework of emotional body language generation for a humanoid robot, intending to address these three limitations. Our starting point is a small set of animations designed by professional animators with the robot morphology in mind. We conducted an initial user study to acquire reliable dimensional labels of valence and arousal for each animation. In the next step, we used the motion sequences from these animations to train a Variational Autoencoder, a deep learning model, to generate numerous new animations in an unsupervised setting. Finally, we extended the model to condition the generative process with valence and arousal attributes, and we conducted a user study to evaluate the interpretability of the animations in terms of valence, arousal, and dominance. The results indicate moderate to strong interpretability