1,510,838 research outputs found
Scientific commentary: Strategic analysis of environmental policy risks-heat maps, risk futures and the character of environmental harm
We summarise our recent efforts on the policy level risk appraisal of environmental risks. These have necessitated working closely with policy teams and a requirement to maintain crisp and accessible messages for policy audiences. Our comparative analysis uses heat maps, supplemented with risk narratives, and employs the multidimensional character of risks to inform debates on the management of current residual risk and future threats. The policy research and ensuing analysis raises core issues about how comparative risk analyses are used by policy audiences, their validation and future developments that are discussed in the commentary below
Risk analysis in manufacturing footprint decisions
A key aspect in the manufacturing footprint analysis is the risk and sensitivity analysis of critical parameters. In order to contribute to efficient industrial methods and tools for making well-founded strategic decisions regarding manufacturing footprint this paper aims to describe the main risks that need to be considered while locating manufacturing activities, and what risk mitigation techniques and strategies that are proper in order to deal with these risks. It is also proposed how the risk analysis should be included in the manufacturing location decision process
The Limits of Diversification When Losses May Be Large
Recent results in value at risk analysis show that, for extremely heavy-tailed risks with unbounded distribution support, diversification may increase value at risk, and that, generally, it is difficult to construct an appropriate risk measure for such distributions. We further analyze the limitations of diversification for heavy-tailed risks. We provide additional insight in two ways. First, we show that similar nondiversification results are valid for a large class of risks with bounded support, as long as the risks are concentrated on a sufficiently large interval. The required length of the support depends on the number of risks available and on the degree of heavy-tailedness. Second, we relate the value at risk approach to more general risk frameworks. We argue that in financial markets where the number of assets is limited compared with the (bounded) distributional support of the risks, unbounded heavy-tailed risks may provide a reasonable approximation. We suggest that this type of analysis may have a role in explaining various types of market failures in markets for assets with possibly large negative outcomes.
An Approach to Select Cost-Effective Risk Countermeasures Exemplified in CORAS
Risk is unavoidable in business and risk management is needed amongst others
to set up good security policies. Once the risks are evaluated, the next step
is to decide how they should be treated. This involves managers making
decisions on proper countermeasures to be implemented to mitigate the risks.
The countermeasure expenditure, together with its ability to mitigate risks, is
factors that affect the selection. While many approaches have been proposed to
perform risk analysis, there has been less focus on delivering the prescriptive
and specific information that managers require to select cost-effective
countermeasures. This paper proposes a generic approach to integrate the cost
assessment into risk analysis to aid such decision making. The approach makes
use of a risk model which has been annotated with potential countermeasures,
estimates for their cost and effect. A calculus is then employed to reason
about this model in order to support decision in terms of decision diagrams. We
exemplify the instantiation of the generic approach in the CORAS method for
security risk analysis.Comment: 33 page
A Crash Risk Assessment Model for Road Curves
A comprehensive model to assess crash risks and reduce driverās exposure to risks on road curves is still unavailable. We aim to create a model that can assist a driver to negotiate road curves safely. The overall model uses situation awareness, ubiquitous data mining and driver behaviour modelling concepts to assess crash risks on road curves. However, only the risk assessment model, which is part of the overall model, is presented in the paper. Crash risks are assessed using the predictions and a risk assessment scale that is created based on driver behaviours on road curves. This paper identifies the contributing factors from which we assess crash risk level. Five risk levels are defined and the contributing factors for each crash risk level are used to determine risk. The contributing factors are identified from a set of insurance crash records using link analysis. The factors will be compared with the actual factors of the driving context in order to determine the risk level
Overlapping Boundaries of the Project Time Management and Project Risk Management
Based on utility function, milestones during project and/or the end of projects or programme may be categorized in what are called soft-deadline and hard-deadline. In contrast with the soft-end projects, the hard-end projects posses a decrease of utility function with a vertical asymptote character around the deadline for project completion. In extreme situations, the utility function itself may fall under zero (projects may generate losses to both constructor and customer). Existing risk analysis methodologies observe risks from monetary terms. The typical risks are correlated with an increase in final project costs. In order to estimate harddeadline milestones and/or end of projects or programme is critical to employ the time dimension rather than the typical cost-based risk analysis. Here, we comprehensively describe a structured methodology that focuses on minimizing and mitigating project specific delay risks. The method may supplement existing cost-based risk analysis in projects. We aim to elegantly combine moderation techniques to reveal the intrinsic risk of the projects. In addition to the technical risks, the moderation techniques are able to bring evidence of risks as the team efficacy, diverse un-correlations or miss-understanding about the roles of the team members in the team ā most of the project soft risk. Described methodology encourages the common understanding of risks for participants, crystallizing the essence of what can go wrong in complex situations and where the opportunities can be unlocked.Project Management, Risk Management, Time Management, Deadline, Delays
A Rational Risk Policy for Regulating Plant Diseases and Pests
Diseases and pests pose risks to U.S. agriculture and forests, but regulations and quarantines to control these risks are costly. The U.S. Department of Agriculture issues rules to control these risks based on economic analyses that do not take adequate account of links between risks and policy outcomes. A benefit-cost analysis that fully incorporates both the risk of a disease outbreak and the effect of regulations and quarantines on such risk can yield quite different conclusions. We apply methods that combine probabilistic risk assessments with economic analysis. We show that if USDA had incorporated risk into its benefit-cost analysis of Karnal bunt, a disease affecting wheat, it would have reached different conclusions about the impact of its actions. We estimate that suboptimal regulatory decisions in the case of Karnal bunt cost between 390 million per year. We recommend that USDA incorporate risk assessments into its economic analyses of proposed regulations.
How do Financial Institutions in China Mitigate Risks in Securitization Markets?
Asset securitization as the essential financial tool has increased the liquidity of underlying assets and promoted rapid economic development. In 2008, the outbreak of Subprime Mortgage Crisis that brought by the collapse of securitization triggered the U.S. securitization market to realize the risks involved in structured financial products, and thus facilitated the development of risk controlling tools. Through the analysis of securitization process, drivers, and credit rating agencies, the study concentrates on the formation of risks and modeling evaluation with evidence in both China and the U.S. markets. Statistical analysis was conducted on Chinese securitized products combining with risk management models built in the U.S. market. The results not only show risk evaluation tools that could improve the market maturity but also reveals the lack of information disclosure in China with the limited access to historical data. The paper attempts to address policy recommendations on mitigating potential risks and promoting financial developments in the China securitization market
Operational Risk Management
We view risk management as an integral part of good management. Risk management should take a balanced view of decision problems encompassing all significant risks and rewards. Operational risks are only one type of risks and therefore are only one piece in the jigsaw puzzle that only makes sense when all pieces are assembled. All risk analyses are based on the same general principles ā generation of alternatives, quantification of uncertainties and preferences, modeling of consequences ā but factors deserving the most attention vary from problem to problem. We distinguish three broad types of operational risks according to the frequencies of loss events: nominal, ordinary and exceptional. Depending on the type, uncertainties are negligible, similar or very large compared to expected losses. Nominal risks are the province of Total Quality Management, a well-developed discipline, but perhaps better known in manufacturing than in financial services. The analysis of ordinary and exceptional risks is illustrated by case studies from which we draw general lessons. With ordinary risks, it is crucial to understand the interaction among risks and with costs and rewards; risks do not add up, indeed operational risks may sometime reduce other uncertainties. With exceptional risks, we show the importance of quantifying the risk attitude of a financial institution in order to arrive at rational decisions such as mitigation or transfer of risks.Risk management, poerational risk, risk attitufe, utility
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Product quality risk perceptions and decisions: contaminated pet food and lead-painted toys.
In the context of the recent recalls of contaminated pet food and lead-painted toys in the United States, we examine patterns of risk perceptions and decisions when facing consumer product-caused quality risks. Two approaches were used to explore risk perceptions of the product recalls. In the first approach, we elicited judged probabilities and found that people appear to have greatly overestimated the actual risks for both product scenarios. In the second approach, we applied the psychometric paradigm to examine risk perception dimensions concerning these two specific products through factor analysis. There was a similar risk perception pattern for both products: they are seen as unknown risks and are relatively not dread risks. This pattern was also similar to what prior research found for lead paint. Further, we studied people's potential actions to deal with the recalls of these two products. Several factors were found to be significant predictors of respondents' cautious actions for both product scenarios. Policy considerations regarding product quality risks are discussed. For example, risk communicators could reframe information messages to prompt people to consider total risks packed together from different causes, even when the risk message has been initiated due to a specific recall event
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