Falling birth rates and world population decline: A quantitative discussion (1950-2040)

The UN data (1950-2010) and projections (both medium and low-fertility variants for 2015- 2040) show that fertility rates are already below replacement level in all continents except Africa. In this paper we develop a simple new approach for population projections based on a Improved Rate Equations (IRE) model. Population projections under the (1) Malthusian assumption, (2) an (IRE) model fitting and extrapolating from actual UN population data up to 2040, and (3) UN projections (low-fertility variant), are compared. The model fits quite well actual data and suggests a world population decline in the 21st Century. The economic, social and political consequences of this new and global circumstance would be far reachin

Feature selection for microarray gene expression data using simulated annealing guided by the multivariate joint entropy

In this work a new way to calculate the multivariate joint entropy is presented. This measure is the basis for a fast information-theoretic based evaluation of gene relevance in a Microarray Gene Expression data context. Its low complexity is based on the reuse of previous computations to calculate current feature relevance. The mu-TAFS algorithm --named as such to differentiate it from previous TAFS algorithms-- implements a simulated annealing technique specially designed for feature subset selection. The algorithm is applied to the maximization of gene subset relevance in several public-domain microarray data sets. The experimental results show a notoriously high classification performance and low size subsets formed by biologically meaningful genes.Postprint (published version

The coevolution of technology, markets, and culture: The challenging case of AI

Artificial intelligence (AI) is at the center of economic, social, political, and ethical debate. For the first time in human history, since the appearance of writing, a new type of “intelligence” is impacting the very nature of social relationships. New technologies are not only changing the operating model of markets and value chains in an accelerated way but also in how information is generated and processed, how labor, social relations, and culture evolve, etc. In this paper, we pursue two main goals. First, to set up an analytical framework in which cognitive, technical, and cultural dynamics are intertwined with the processes of deployment of economic action. Secondly, we utilize this framework to explore some key features and challenges of AI and its impact on coevolutionary processes at the cognitive, market, and cultural levels. We devote special attention to the consequences that AI may have for the concept of (economic) rationality and the formation of action plans. We conclude that AI will massively enhance agents’ spaces of action by improving efficiency and exploring new possibilities. However, AI will not change the nature of human action and the structure of the evolution of the economic syste

Historical financial analogies of the current crisis

This paper tries to shed light on the historical analogies of the current crisis. To that end we compare the current sample distribution of Dow Jones Industrial Average Index returns for a 769-day period (from 15 September 2008, the Lehman Brothers bankruptcy, to September 2011), with all historical sample distributions of returns computed with a moving window of 769 days in the 2 January 1900 to 12 September 2008 period. Using a Kolmogorov-Smirnov and a x2 homogeneity tests which have the null hypothesis of equal distribution we find that the stock market returns distribution during the current crisis would be similar to several past periods of severe financial crises that evolved into intense recessions, being the sub-sample from 28 May 1935 to 17 Jun 1938 the most analogous episode to the current situation. Furthermore, when applying the procedure proposed by Diebold, Gunther and Tay (1998) for comparing densities of sub-samples, we obtain additional support for our findings and discover a period from 10 September 1930 to 13 October 1933 where the severity of the crisis overcomes the current situation having sharper tail events. Finally, when comparing historical market risk with the current risk, we observe that the current market risk has only been exceeded at the beginning of the Great Depression.Financial crisis, Great Recession, Great Depression

The allocation of entrepreneurial effort and its implications on economic growth

The problem to allocate effort to innovation activities is defined and modelled for any single entrepreneur according to its propensity to innovate, which combines pure innovation and rent-seeking strategies. The allocation problem is solved both analytically and via simulation. The individual decisions measured in units of innovation are then aggregated to calculate the innovation quantity for a given population based on the distribution of heterogeneous entrepreneurs. The entrepreneurship rate and the implications for economic growth are also quantified. Consequently, policy makers should focus on reducing the entry barriers and the costs of production in order to stimulate the entrepreneurial activity and maximize the innovation quantity. They should also foster the attitude and propensity towards innovatio

Teoría Económica y Desarrollo Social. Exclusión, desigualdad y democracia. Homenaje a Adolfo Figueroa

Los autores de los artículos de este libro de homenaje a Adolfo Figueroa abordan temas de desigualdad, exclusión y políticas para el desarrollo social y de la democracia.América Latina

Does size matter in group decision making? Simulation experiments with LNG professionals bidding in auction markets

Purpose: An important issue in decision-making processes is whether groups decide better than individuals. This paper compares the bidding behavior of groups of professionals while playing a business game that simulates, in a controlled environment, the sequential unit capacity auctions in the Spanish LNG market. Design/methodology/approach: First, we randomly grouped professionals in groups of different size—SOLOs, DUOs, and TRIOs—and played the game in-situ under both First and Second price unit capacity auctions, with SOLOs outperforming groups. Second, we ran non-parametric simulations mixing professionals in groups of different size, in which bids were coupled with those registered during the in-situ sessions. Third, we ran non-parametric simulations in which the players were either ‘rational machines’ that bid according to Nash equilibrium or groups of ‘professionals’ of different size. Findings: The size of the decision group does matter. After the in-situ and the bootstrapped simulated games, the main result is that size does matter, and groups are not necessarily superior to individuals bidding alone. SOLO players bid closer to MACHINEs and lower than DUOs or TRIOs, while obtaining about the same number of units and higher payoffs than groups. Additionally, the ‘degree of rationality’ of the participants does also matter. Research limitations/implications: Even after applying the hybrid simulation methodology to increase sample size and allow for additional experimental settings, some of the scenarios are fictitious. Modification of the business game to allow for an even more realistic game could be implemented. Practical implications: After the hybrid simulation approach, the main implication of the paper is that to increase efficiency in resource allocation professionals should bid individually while using the theoretical knowledge of rational machines. Originality/value: To our knowledge, this is the first time that this double-experiment simulation methodology is used to analyze bidding behavior in auctionsPeer Reviewe

Conexiones entre empresas y oportunidad de clúster: El caso de las empresas biotecnológicas en la Comunidad de Madrid

Much of the Spanish biotechnology industry activity operates in the Community of Madrid (CM). Regional and local authorities are very interested in constituting a biotechnology cluster in the Community. All the necessary elements can be found in the region: as shown, there exists the opportunity for the emergence of a biotechnology cluster in CM. However, at the present time no biotechnology cluster can be said to exist as such in the region; there is only a cluster opportunity. In order to demonstrate this proposition, we provide an overview of the biotechnology industry, focusing on the fi rms that operate in Madrid and their connections between themselves and the other actors in the system. Any cluster strategy that aims to develop a biotechnology cluster in Madrid should consider the form of these connectionsBuena parte de la industria biotecnológica española opera en la Comunidad Autónoma de Madrid (CAM). Las autoridades regionales y locales están muy interesadas en constituir un cluster biotecnológico en la comunidad. Todos los elementos necesarios para que pueda surgir dicho cluster están presentes en la región: como se muestra en este trabajo, existe la oportunidad para que emerja un cluster biotecnológico en la CAM. Sin embargo, no se puede afirmar con total seguridad que tal cluster exista por el momento en la región; tan solo hay una oportunidad de cluster. Para demostrar esta proposición, proporcionamos una panorámica de la industria biotecnológica centrándonos en las empresas que operan en Madrid y sus conexiones con otras empresas del sector y con otros actores del sistema de innovación. Cualquier estrategia que busque desarrollar un cluster biotecnológico en Madrid debería tener en cuenta la naturaleza de estas conexione