Designing Catastrophe Bonds to Securitize Systemic Risks in Agriculture: The Case of Georgia Cotton

This article makes an initial attempt to design catastrophe (CAT) bond products for agriculture and examines the potential of these instruments as mechanisms for transferring agricultural risks from insurance companies to investors/speculators in the global capital market. The case of Georgia cotton is considered as a specific example. The CAT bond contracts are based on percentage deviations of realized state average yields relative to the long-run average. The contracts are priced using historical state-level cotton yield data. The principal finding of the study is that the proposed CAT bonds demonstrate potential as risk transfer mechanisms for crop insurance companies.CAT bonds, catastrophe bond pricing, catastrophe insurance, disaster risk, reinsurance, risk securitization, Risk and Uncertainty,

Payload deployment method and system

A method and apparatus for deploying the payload of space shuttle or the like is described. It is referred to as the Stabilized Payload Deployment System (SPDS). The payload is rotated about an axis outside of the payload but approximately longitudinally with the cargo bay of the shuttle craft. The payload may thus be rotated through ninety degrees. In this case, that is, in its rotated position, the payload may or may not have a small portion located within the cargo bay. Alternatively, the payload may be located completely outside of the bay. According to the apparatus two separable hinge-like devices connect at one longitudinal side or edge of the payload to respective ones of the payload trunnions at different longitudinally spaced locations along the length of the payload. Separation of the payload from the cargo bay is made by unlatching a latch and by the use of a repulsion spring at the position of each hinge-like device. Two four-link mechanisms allow movement between payload and bay. Such accommodative movement is required especially during launch when considerable vibration is encountered

Impacts of government risk management policies on hedging in futures and options:LPM2 hedge model vs. EU hedge model

The main objective of this study is to compare the impacts of government payments and crop insurance policies on the use of futures and options measured from a downside risk hedge model with the impacts analyzed by the expected utility (EU) hedge model. Understanding the effects of government-provided risk management tools on the private market risk management tools, such as futures and options, provides value to both crop farmers and policy makers. Comparison of the impacts from the two hedge models shows that crop farmer will hedge less in futures under the LPM2 model than under the EU hedge model. This finding indicates that model misspecification is another reason for the phenomenon that farmers actually hedge less in futures than predicted by the EU model. From the perspective of exploring new research techniques, this study applied two relatively new simulation concepts, copula simulation and conditional kernel density approach, to make the simulation assumptions less restrictive and more consistent with observations. The copula simulation applied in this study allows yield and price to have more flexible joint distribution functions than multivariate normal; the conditional kernel density approach used in farm yield simulation enables the variance of farm yield varies with county yield rather than being constant.Down-side Risk, LPM2 Hedge Model, Government Payments, Crop Insurance Policies, Copula Simulation, Conditional Kernel Density, Agricultural Finance,

Frictional quantum decoherence

The dynamics associated with a measurement-based master equation for quantum Brownian motion are investigated. A scheme for obtaining time evolution from general initial conditions is derived. This is applied to analyze dissipation and decoherence in the evolution of both a Gaussian and a Schr\"{o}dinger cat initial state. Dependence on the diffusive terms present in the master equation is discussed with reference to both the coordinate and momentum representations.Comment: 18 pages, 7 figure

Hedging Downside Risk to Farm Income with Futures and Options: Effects of Government Payment Programs and Federal Crop Insurance Plans

The high proportion of government payments in total crop farm income and the purchase of subsidized crop insurance have changed the income distribution of U.S. crop farmers. As a result, the risk management behaviors of U.S. crop farmers are affected by these programs in terms of the use of private market risk management tools, such as futures and options. The objective of this research is to investigate the effects of the government payments and federal crop insurance policies on the usage of futures and options by crop farmers from a downside risk management perspective. Results in this study suggest that both yield insurance and revenue insurance creates more hedging demands for futures. But revenue insurance decreases the buying of put options at the same time. Loan deficiency government payments substitutes largely for the hedging role of put options while Counter Cyclical payments substitutes futures hedge. This research contributes the literature by proposing to use a downside risk hedge model, the second-order lower partial moment (LPM2) hedge model, to investigate the interaction of government and private risk management tools used by crop farmers. This study also initiatively applies the conditional kernel density method and the copula approach in the data simulation process. The conditional kernel density method generates county yield and farm yield with the same conditional pattern as revealed in the historical yields. The copula simulation allows the crop yield and prices have more flexible joint distributions other than bivariate normal.Agricultural and Food Policy, Agricultural Finance,

Exploring Outliers in Crowdsourced Ranking for QoE

Outlier detection is a crucial part of robust evaluation for crowdsourceable assessment of Quality of Experience (QoE) and has attracted much attention in recent years. In this paper, we propose some simple and fast algorithms for outlier detection and robust QoE evaluation based on the nonconvex optimization principle. Several iterative procedures are designed with or without knowing the number of outliers in samples. Theoretical analysis is given to show that such procedures can reach statistically good estimates under mild conditions. Finally, experimental results with simulated and real-world crowdsourcing datasets show that the proposed algorithms could produce similar performance to Huber-LASSO approach in robust ranking, yet with nearly 8 or 90 times speed-up, without or with a prior knowledge on the sparsity size of outliers, respectively. Therefore the proposed methodology provides us a set of helpful tools for robust QoE evaluation with crowdsourcing data.Comment: accepted by ACM Multimedia 2017 (Oral presentation). arXiv admin note: text overlap with arXiv:1407.763

First Principles Study of the Electronic and Vibrational Properties of LiNbO2

In the layered transition metal oxide LiNbO$_2$ the Nb$^{3+}$ ($4d^2$) ion is trigonal-prismatically coordinated with O ions, with the resulting crystal field leading to a single band system for low energy properties. A tight-binding representation shows that intraplanar second neighbor hopping $t_2 = 100$ meV dominates the first neighbor interaction ($t_1 = 64$ meV). The first and third neighbor couplings are strongly modified by oxygen displacements of the symmetric Raman-active vibrational mode, and electron-phonon coupling to this motion may provide the coupling mechanism for superconductivity in Li-deficient samples (where $T_c = 5$ K). We calculate all zone-center phonon modes, identify infrared (IR) and Raman active modes, and report LO-TO splitting of the IR modes. The Born effective charges for the metal ions are found to have considerable anisotropy reflecting the degree to which the ions participate in interlayer coupling and covalent bonding. Insight into the microscopic origin of the valence band density, composed of Nb $d_{z^2}$ states with some mixing of O $2p$ states, is obtained from examining Wannier functions for these bands.Comment: 12 pages, 7 figures; Updated with reviewer comments; Updated reference

Parametric Evolution for a Deformed Cavity

We consider a classically chaotic system that is described by a Hamiltonian H(Q,P;x), where (Q,P) describes a particle moving inside a cavity, and x controls a deformation of the boundary. The quantum-eigenstates of the system are |n(x)>. We describe how the parametric kernel P(n|m) = , also known as the local density of states, evolves as a function of x-x0. We illuminate the non-unitary nature of this parametric evolution, the emergence of non-perturbative features, the final non-universal saturation, and the limitations of random-wave considerations. The parametric evolution is demonstrated numerically for two distinct representative deformation processes.Comment: 13 pages, 8 figures, improved introduction, to be published in Phys. Rev.

Cloning and Joint Measurements of Incompatible Components of Spin

A joint measurement of two observables is a {\it simultaneous} measurement of both quantities upon the {\it same} quantum system. When two quantum-mechanical observables do not commute, then a joint measurement of these observables cannot be accomplished by projective measurements alone. In this paper we shall discuss the use of quantum cloning to perform a joint measurement of two components of spin associated with a qubit system. We introduce a cloning scheme which is optimal with respect to this task. This cloning scheme may be thought to work by cloning two components of spin onto its outputs. We compare the proposed cloning machine to existing cloners.Comment: 7 pages, 2 figures, submitted to PR