Full robustness to outliers in a Bayesian location-scale model

The use of heavy-tailed distributions is a valuable tool in developing robust Bayesian procedures, limiting the influence of outliers on posterior inference. In this paper, the behavior of the posterior density for a location-scale model is investigated when the sample contains outliers. L-exponentially varying functions are introduced in order to characterize the tails of the densities. Simple conditions on the tails of the likelihood, using L-exponentially varying functions, are established to determine the proportion of observations that can be rejected as outliers. It is shown that the posterior distribution converges in law to the posterior that would be obtained from the reduced sample, excluding the outliers, as they tend to plus or minus infinity, at any given rate

Robustness to outliers in location-scale parameter model using log-regularly varying distributions

Estimating the location and scale parameters is common in statistics, using, for instance, the well-known sample mean and standard deviation. However, inference can be contaminated by the presence of outliers if modeling is done with light-tailed distributions such as the normal distribution. In this paper, we study robustness to outliers in location-scale parameter models using both the Bayesian and frequentist approaches. We find sufficient conditions (e.g., on tail behavior of the model) to obtain whole robustness to outliers, in the sense that the impact of the outliers gradually decreases to nothing as the conflict grows infinitely. To this end, we introduce the family of log-Pareto-tailed symmetric distributions that belongs to the larger family of log-regularly varying distributions.Comment: Published at http://dx.doi.org/10.1214/15-AOS1316 in the Annals of Statistics (http://www.imstat.org/aos/) by the Institute of Mathematical Statistics (http://www.imstat.org

Polluters and Abaters

To comply with laws, regulations and social demands, polluting firms increasingly purchase the needed means from specialized suppliers. This paper analyzes this relatively recent phenomenon. We show how environmental regulation, the size of the output market, the elasticity of demand for abatement goods and services, and the fact that in-house and outsourced abatement expenses are substitutes or complements can influence a polluter’s make-or-buy decision. Specific features of abatement outsourcing are highlighted, qualifications and refinements of the theory of vertical integration are then proposed, and some consequences for environmental policy are briefly discussed.Eco-industry, Make-or-buy Decision, Outsourcing, Vertical Integration

Environmental Risk Management and the Business Firm

This chapter considers three matters that business firms whose activities can be dangerous for human health and the environment increasingly have to deal with: public disclosure of all health and environmental risks, direct involvement of stakeholders in the management of operations, and integration of health and environmental risk management with the management of other business risks. It summarizes recent managerial economics research on those matters and suggests some promising research areas. Ce chapitre considère trois questions qui préoccupent de plus en plus les firmes dont les activités font peser certains risques sur la santé humaine et l'environnement, soit la révélation au public de ces risques, l'implication directe de parties externes (assureurs, banquiers, représentants du public, etc.) dans la gestion des opérations, voire la planification stratégique, et la gestion intégrée de tous les risques d'affaires. On résume les récentes percées de l'économie managériale sur ces sujets, et l'on indique certaines pistes de recherche particulièrement prometteuses.Environmental risk disclosures, extended liability, integrated risk management, Bilan environnemental, responsabilité étendue, gestion intégrée des risques

Remarks on Environmental Regulation, Firm Behavior and Innovation

The Porter Hypothesis says that well-designed environmental regulation should trigger innovations and enhance the competitiveness of firms. This paper, which follows the invitation to participate at a recent workshop financed by the Environmental Protection Agency in Washington, summarizes theoretical findings concerning this Hypothesis and makes recommendations to improve existing regulation. L'hypothèse de Porter veut qu'une réglementation environnementale bien conçue encourage l'innovation et renforce la compétitivité des entreprises. Ce cahier, qui fait suite à l'invitation à participer à un récent atelier financé par la Environmental Protection Agency des États-Unis, résume la recherche théorique récente se rapportant à la validité de cette hypothèse et formule des recommandations visant à améliorer les réglements existants.Environmental regulation, innovation, organizational failure, Réglementation environnementale, innovation, failles organisationnelles

Corporate Strategies For Managing Environmental Risk (The International Library Of Environmental Economics And Policy – Volume xx)

This paper is the introduction to a forthcoming anthology (published by Ashgate) of economic contributions to the subject. It ties the articles together, starting with a primer on corporate strategy, then considering corporate environmental strategy, and concluding on implementation issues. Cet article est en fait l'introduction d'une anthologie (à paraître chez Ashgate) de contributions marquantes de l'analyse économique aux stratégies environnementales corporatives. On vise donc à intégrer les articles retenus autour de trois pôles : la stratégie corporative, la stratégie environnementale, et les questions de mise en oeuvre.economics of strategy, environmental economics, implementation of strategy, économie de la stratégie d'entreprise, économie de l'environnement, implantation de la stratégie

Polluters and Abaters

To comply with laws, regulations and social demands, polluting firms increasingly purchase the needed means from specialized suppliers. This paper an- alyzes this relatively recent phenomenon. We show how environmental regulation, the size of the output market, the elasticity of demand for abatement goods and services, and the fact that in-house and outsourced abatement expenses are substitutes or complements can influence a polluter's make-or-buy decision. Specific features of abatement outsourcing are highlighted, qualifications and refinements of the theory of vertical integration are then proposed, and some consequences for environmental policy are briefly discussed.

The Pigouvian Tax Rule in the Presence of an Eco-Industry

Les biens et services de dépollution sont actuellement le plus souvent livrés par une éco-industrie. Cette note reconsidère la taxe pigouvienne dans ce contexte. On montre qu'une taxe optimale sur les émissions polluantes se démarquera du coût social marginal de la pollution en fonction des pouvoirs de marché relatifs des pollueurs et des firmes environnementales.

The Pigouvian Tax Rule in the Presence of an Eco-Industry

Pollution abatement goods and services are now largely being delivered by a specialized “eco-industry.” This note reconsiders Pigouvian taxes in this context. We find that the optimal emission tax will depart from the marginal social cost of pollution according to the polluters’ and the environment firms’ relative market power.Pigouvian taxes, Environment industry

Incentives in Common Agency

This paper considers situations where an agent must allocate his nonobservable effort among several tasks and where several principals hold diverging viewpoints on what the best allocation should be. Economic theory currently sees each of these features as major obstacles to raising the strength of an agent s incentives. This paper proposes a simple scheme - based on contingent monitoring - that can nevertheless mitigate both of these obstacles simultaneously. Under this scheme, if the agent s absolute risk aversion decreases fast enough with respect to wealth, then the principals would coordinate their respective incentive provision so that the agent would also see his various tasks as complementary (instead of substitute) income-enhancing activities. Furthermore, coordination could be achieved in a somewhat liberal or decentralized way, in the sense that some principals would need to control only the tasks they have assigned to the agent. Potential applications to corporate compliance, the organization of government, and the management of innovation are briefly discussed. Nous étudions les situations où (1) un agent doit distribuer ses efforts (qui ne peuvent être observés par des tiers) sur différentes tâches et où (2) plusieurs parties prenantes ont des points de vue divergents quant à la distribution la plus souhaitable. La théorie économique prédit actuellement que chacun de ces ingrédients la présence de tâches multiples et la concurrence entre parties prenantes -suffit à lui seul à abaisser considérablement la puissance des incitations. Ce papier propose néanmoins un remède simple, via l utilisation d audits contingents. Le mécanisme proposé rendrait en effet les tâches complémentaires du point de vue de l agent ; en même temps, les parties prenantes parviendraient à se coordonner pour le mettre en oeuvre, à condition que l aversion au risque de l agent décroisse suffisamment vite avec l augmentation de sa richesse. Cette coordination pourrait par ailleurs se réaliser d une manière «libérale», en ce sens que certaines parties prenantes n auraient besoin de contrôler que les tâches les intéressant directement. Certaines utilisations possibles du mécanisme pour les régimes de conformité des entreprises, l organisation des gouvernements, et le management de l innovation sont brièvement esquissées., nous trouvons des changements dans la dynamique et dans la mémoire longue de la volatilité.Multitasking, several principals, upper-tail audits, Principal-agent, multi-tâches, plusieurs principaux, audits