Approximate Models and Robust Decisions

Decisions based partly or solely on predictions from probabilistic models may be sensitive to model misspecification. Statisticians are taught from an early stage that "all models are wrong", but little formal guidance exists on how to assess the impact of model approximation on decision making, or how to proceed when optimal actions appear sensitive to model fidelity. This article presents an overview of recent developments across different disciplines to address this. We review diagnostic techniques, including graphical approaches and summary statistics, to help highlight decisions made through minimised expected loss that are sensitive to model misspecification. We then consider formal methods for decision making under model misspecification by quantifying stability of optimal actions to perturbations to the model within a neighbourhood of model space. This neighbourhood is defined in either one of two ways. Firstly, in a strong sense via an information (Kullback-Leibler) divergence around the approximating model. Or using a nonparametric model extension, again centred at the approximating model, in order to `average out' over possible misspecifications. This is presented in the context of recent work in the robust control, macroeconomics and financial mathematics literature. We adopt a Bayesian approach throughout although the methods are agnostic to this position

Starting Small in an Unfamiliar Environment

Motivated by a characteristic way in which firms in developed countries make their decisions regarding cooperation with potential partners from less developed countries, we design a simple model of a DC firm's search for an LDC partner/supplier and the subsequent relationship between the two parties. Matched firms can "start small" with a trial order or pilot project of variable size in order to gain information about the ability of the LDC firm to successfully carry out a large project. We derive results relating whether and how the parties start small to the characteristics of the large project and to the matching environment. Among other results, we show how risk and search cost are associated with the propensity to start small and we establish a connection between starting small and the expected longevity of successful partnerships. We also address methods of contract enforcement and demonstrate the relationship between starting small and monitoring.

Entrepreneurship in International Trade

Motivated by evidence on the importance of incomplete information and networks in international trade, we investigate the supply of 'network intermediation.' We hypothesize that the agents who become international trade intermediaries first accumulate networks of foreign contacts while working as employees in production or sales, then become entrepreneurs who sell access to and use of the networks they accumulated. We report supportive results regarding this hypothesis from a pilot survey of international trade intermediaries. We then build a simple general-equilibrium model of this type of entrepreneurship, and use it for comparative statics and welfare analysis. One welfare conclusion is that intermediaries may have inadequate incentives to maintain or expand their networks, suggesting a rationale for the policies followed by some countries to encourage large-scale trading companies that imitate the Japanese sogo shosha.

Modulation of swimming in the gastropod Melibe leonina by nitric oxide

Nitric oxide (NO) is a gaseous intercellular messenger produced by the enzyme nitric oxide synthase. It has been implicated as a neuromodulator in several groups of animals, including gastropods, crustaceans and mammals. In this study, we investigated the effects of NO on the swim motor program produced by isolated brains and by semi-intact preparations of the nudibranch Melibe leonina. The NO donors sodium nitroprusside (SNP, 1 mmol l–1) and S-nitroso-N-acetylpenicillamine (SNAP, 1 mmol l–1) both had a marked effect on the swim motor program expressed in isolated brains, causing an increase in the period of the swim cycle and a more erratic swim rhythm. In semi-intact preparations, the effect of NO donors was manifested as a significant decrease in the rate of actual swimming. An NO scavenger, reduced oxyhemoglobin, eliminated the effects of NO donors on isolated brains, supporting the assumption that the changes in swimming induced by donors were actually due to NO. The cGMP analogue 8-bromoguanosine 3′,5′-cyclic monophosphate (1 mmol l–1) produced effects that mimicked those of NO donors, suggesting that NO is working via a cGMP-dependent mechanism. These results, in combination with previous histological studies indicating the endogenous presence of nitric oxide synthase, suggest that NO is used in the central nervous system of Melibe leonina to modulate swimming

Understanding radionuclide migration from the D1225 Shaft, Dounreay, Caithness, UK

A 65 m vertical shaft was sunk at Dounreay in the 1950s to build a tunnel for the offshore discharge of radioactive effluent from the various nuclear facilities then under construction. In 1959, the Shaft was licensed as a disposal facility for radioactive wastes and was routinely used for the disposal of ILW until 1970. Despite the operation of a hydraulic containment scheme, some radioactivity is known to have leaked into the surrounding rocks. Detailed logging, together with mineralogical and radiochemical analysis of drillcore has revealed four distinct bedding-parallel zones of contamination. The data show that Sr-90 dominates the bulk beta/gamma contamination signal, whereas Cs-137 and Pu-248/249 are found only to be weakly mobile, leading to very low activities and distinct clustering around the Shaft. The data also suggest that all uranium seen in the geosphere is natural in origin. At the smaller scale, contamination adjacent to fracture surfaces is present within a zone of enhanced porosity created by the dissolution of carbonate cements from the Caithness flagstones during long-term rockwater interactions. Quantitative modelling of radionuclide migration, using the multiphysics computer code QPAC shows the importance of different sorption mechanisms and different mineralogical substrates in the Caithnesss flagstones in controlling radionuclide migration

Preparing Tomorrow\u27s Classroom Leaders: Challenges for Christian Higher Education

Christian college teacher education program faculties face the challenge of employing a Christian epistemology that includes a pedagogy that embraces today’s learners. The authors seek to communicate the foundations of modernism and postmodernism and their impact on the epistemology and pedagogies employed in university classrooms. How the postmodern thinking claims have influenced the lives of Christian students will also be examined. The paper concludes with a discussion of the challenges for Christian teacher education faculties