Bayes and empirical-Bayes multiplicity adjustment in the variable-selection problem

This paper studies the multiplicity-correction effect of standard Bayesian variable-selection priors in linear regression. Our first goal is to clarify when, and how, multiplicity correction happens automatically in Bayesian analysis, and to distinguish this correction from the Bayesian Ockham's-razor effect. Our second goal is to contrast empirical-Bayes and fully Bayesian approaches to variable selection through examples, theoretical results and simulations. Considerable differences between the two approaches are found. In particular, we prove a theorem that characterizes a surprising aymptotic discrepancy between fully Bayes and empirical Bayes. This discrepancy arises from a different source than the failure to account for hyperparameter uncertainty in the empirical-Bayes estimate. Indeed, even at the extreme, when the empirical-Bayes estimate converges asymptotically to the true variable-inclusion probability, the potential for a serious difference remains.Comment: Published in at http://dx.doi.org/10.1214/10-AOS792 the Annals of Statistics (http://www.imstat.org/aos/) by the Institute of Mathematical Statistics (http://www.imstat.org

Small business credit scoring and credit availability

U.S. commercial banks are increasingly using credit scoring models to underwrite small business credits. This paper discusses this technology, evaluates the research findings on the effects of this technology on small business credit availability, and links these findings to a number of research and public policy issues.

Tests of ex ante versus ex post theories of collateral using private and public information

Collateral is a widely used, but not well understood, debt-contracting feature. Two broad strands of theoretical literature explain collateral as arising from the existence of either ex ante private information or ex post incentive problems between borrowers and lenders. However, the extant empirical literature has been unable to isolate each of these effects. This paper attempts to do so using a credit registry that is unique in that it allows the researcher to have access to some private information about borrower risk that is unobserved by the lender. The data also include public information about borrower risk, loan contract terms, and ex post performance for both secured and unsecured loans. The results suggest that the ex post theories of collateral are empirically dominant although the ex ante theories are also valid for customers with short borrower-lender relationships that are relatively unknown to the lender.

Review of Archival Values: Essays in Honor of Mark A. Greene

Review of Archival Values: Essays in Honor of Mark A. Greene

Debt maturity, risk, and asymmetric information

We test the implications of Flannery’s (1986) and Diamond’s (1991) models concerning the effects of risk and asymmetric information in determining debt maturity, and we examine the overall importance of informational asymmetries in debt maturity choices. We employ data from more than 6,000 commercial loans from 53 large U.S. banks. Our results for low-risk firms are consistent with the predictions of both theoretical models, but our findings for high-risk firms conflict with the predictions of Diamond’s model and with much of the empirical literature. Our findings also suggest a strong quantitative role for asymmetric information in explaining debt maturity.

Why do borrowers pledge collateral? new empirical evidence on the role of asymmetric information

An important theoretical literature motivates collateral as a mechanism that mitigates adverse selection, credit rationing, and other inefficiencies that arise when borrowers hold ex ante private information. There is no clear empirical evidence regarding the central implication of this literature—that a reduction in asymmetric information reduces the incidence of collateral. We exploit exogenous variation in lender information related to the adoption of an information technology that reduces ex ante private information, and compare collateral outcomes before and after adoption. Our results are consistent with this central implication of the private-information models and support the empirical importance of this theory.

Amaila Falls Hydroelectric Project Model Development and Scenarios

The focus of this present study is to perform the following tasks: * Develop a hydrodynamic and water quality model of the reservoir formed by the Amaila Falls Hydroelectric Project * Develop and run modeling scenarios Water quality model simulations of the 23.3 km2 reservoir for Amaila Falls Hydroelectric Project were conducted for low, average, and high flow years. A scenario with no vegetation removed from the reservoir for an average flow was also simulated. Conditions downstream of the reservoir were also modeled using a river model. The model used for the reservoir formed by Amaila Falls Hydroelectric Project is the public domain model, CE-QUAL-W2

More terminological clarity in the interprofessional field - a call for reflection on the use of terminologies, in both practice and research, on a national and international level

The terminology which has been used up until now within interprofessional healthcare has been characterised by a certain definitional weakness, which, among other factors, has been caused by an uncritical adoption of language conventions and a lack of theoretical reflection. However, as terminological clarity plays a significant role in the development and profiling of a discipline, the clarification and definition of commonly-used terminology has manifested itself as a considerable objective for the interprofessional research community. One of the most important journals for research in the area of interprofessional education and care, the Journal of Interprofessional Care, has expanded its author guidelines relating to terminology, modeled after the conceptual considerations of the research group around Barr et. al and Reeves et al. A German translation of the suggested terms therein has been presented in this contribution, and discussed in light of the challenges to a possible adaptation for the German-speaking world. The objective is to assist communication in practice and research in becoming clearer, while promoting an increasing awareness to and the transparency of determined definitions and terminologies

Upper Spokane River Model: Boundary Conditions and Model Setup, 1991 and 2000

The Washington Department of Ecology is interested in a water quality model for the Upper Spokane River system for use in developing Total Maximum Daily Loads (TMDLs). The goals of this modeling effort are to: • Gather data to construct a computer simulation model of the Spokane River system including Long Lake Reservoir and the pools behind Nine Mile dam, Upper Falls dam and Upriver dam • Ensure that the model accurately represents the system hydrodynamics and water quality (flow, temperature, dissolved oxygen and nutrient dynamics) A hydrodynamic and water quality model, CE-QUAL-W2 Version 3 (Wells, 1997), is being applied to model the Spokane River system. CE-QUAL-W2 is a two dimensional (longitudinal-vertical), laterally averaged, hydrodynamic and water quality model that has been under development by the Corps of Engineers Waterways Experiments Station (Cole and Wells, 2000). In order to model the system, the following data were required: • Spokane River flow, water level and water quality data at the upstream system boundary (the State of Idaho boundary) • Tributary inflows and water quality • Meteorological conditions • Bathymetry of the Spokane River, the dam pools along the river, and Long Lake Reservoir • Point source (wastewater treatment plants, WWTPs) inflows and water quality characteristics Data have been primarily collected from 1991 to 1992 and again during 2000. This report summarizes the data used in the modeling effort

Upper Spokane River Model in Idaho: Boundary Conditions and Model Setup and Calibration for 2001 and 2004

As a result of a Total Maximum Daily Load (TMDL) study of the Spokane River in Washington, a hydrodynamic and water quality model for the Spokane River was developed by Portland State University (PSU) for the Corps of Engineers and the Washington Department of Ecology from the Washington-Idaho state line to the outlet of Long Lake. An earlier study of the Spokane River was undertaken by Limno-Tech (2001a, 2001b) for the domain shown in Figure 3. Limno-Tech used an earlier version of CE-QUAL-W2, Version 2, for the Reservoir portion of the Spokane River from Post Falls Dam to Coeur d’Alene Lake and a steady-state EPA model, QUAL2E, for the riverine section from Post Falls Dam to the Idaho-Washington State Line. The steady-state QUAL2E model was not adequate to deal with flow and water quality dynamics. Hence, the riverine portion of the model and the reservoir portion were both upgraded to CE-QUAL-W2 Version 3.1. PSU developed the CE-QUAL-W2 model, but did not have adequate data for model calibration. The set-up of this model was described in the following report: * Wells et al. (2003) - Upper Spokane River Model in Idaho: Boundary Conditions and Model Setup for 2001 Because of the necessity of looking at the entire river basin, a model using CE-QUAL-W2 Version 3.1 of the Idaho portion of the Spokane River model was developed to assess water quality management strategies for the Idaho side of the Spokane River. The objective of this study was to use new field data from 2001 and 2004 to improve the model calibration for the Idaho portion of the Spokane River and reevaluate the work done by Wells et al. (2003)