2016 INFORMS Annual Meeting Program

SB38

INFORMS Nashville – 2016

SB40 207B-MCC Applications of Data Envelopment Analysis Invited: Data Envelopment Analysis Invited Session Chair: Daiki Wakayama, Komazawa University, 1-23-1-2409 komazawa, Setagaya-ku, Tokyo, 154-8525, Japan, dwakayam@komazawa-u.ac.jp 1 - Transmission Congestion And Eco-technology Innovation In U.S. Electric Power Industry Measured by DEA Environmental Assessment Daiki Wakayama, Komazawa University, Tokyo, 3510021, Japan, dwakayam@komazawa-u.ac.jp, Mika Goto, Toshiyuki Sueyoshi This study discusses a new use of DEA environmental assessment to measure a possible occurrence of congestion in U.S. coal-fired power plants. The congestion is classified into two categories: Undesirable Congestion (UC: indicating a transmission limit) and Desirable Congestion (DC: indicating eco-technology innovation). The identification of UC is important to avoid a cost increase and a shortage of electricity, while investigating of DC can be effectively used to reduce the amount of air pollution. This study finds that UC may occur on most of power plants. In contract, DC may occur on a limited number of power plants. 2 - Study Of Capital Requirement And Bank Operating Efficiency Yang Li, National University of Kaohsiung Kaohsiung, yangli@nuk.edu.tw Following the 2008 financial tsunami, the Bank of International Settlements proposed Basel III in 2010, in which banks need to raise their capital adequacy ratio in order to make them sound and safe. This study employs the two-stage bootstrapped truncated regression model, proposed by Simar and Wilson (2007), and takes into account undesirable outputs to investigate how the increases in core, tier I, and total capital adequacy ratios influence the efficiency of Chinese commercial banks. The data set is obtained from Bankscope for the period 2012- 2014. Empirical results are consistent with the schedule and intention set by Basel III. 3 - Statistical Measure Of Goodness On Quantitative Models Of Efficiency And Effectiveness Abbas Attarwala, University of Waterloo, Waterloo, ON, Canada, aattarwa@uwaterloo.ca, Stanko Dimitrov, Amer Obeidi We propose a statistical measure of goodness on quantitative models of efficiency and effectiveness. Our measure is used in a financial setting based on the Efficient Market Hypothesis. Using information criterion we find the best fit model in a family of functions. The goodness of fit of a model is traded against the number of parameters required to achieve this approximation. We apply the developed statistical measure on four models using two case studies of U.S and Indian bank data. 4 - The Group And Individual Evaluation Using Fuzzy Dea We use the fuzzy DEA to evaluate the performance based on the evaluators’ scores, which come from the evaluation questionnaire and considered as fuzzy DMUs. We suppose the situation of teachers’ evaluation by students’ score. The fuzzy DEA model is used to analyze the group evaluation of the performance effectiveness. The DEA model is firstly used to analyze the scores for every DMU, where the evaluators’ ambiguity or bias may bring the fuzziness of DMU. It also compares the group evaluation and individual evaluation on efficiencies. This approach is more objective and fair by avoiding the effect of the directly counting scores which is easily affected by negative or positive attitude of evaluators. Hiroshi Morita, Osaka University, Suita, Japan, morita@ist.osaka-u.ac.jp, Rui Dai, Minghao Chen

3 - Unbundling Of Ancillary Service: How Does Price Discrimination Of Main Product Matter? Yao Cui, Cornell University, Ithaca, NY, United States, yao.cui@cornell.edu, Izak Duenyas, Ozge Sahin We consider a setting where the firm sells a main service and an ancillary service. We study how the firm’s ability to charge discriminatory main service prices affects the decision of whether to separately charge for the ancillary service, both for the firm and for the industry. 4 - Centralized Vs. Decentralized Platform Markets Daniela Saban, Stanford GSB, dhs2131@columbia.edu, Yash Kanoria We consider a two-sided matching market with search frictions, and study the impact of the matching technology and platform design on the efficacy of the marketplace in serving its users. We find that a few different designs may be optimal in different settings, with the best choice of design depending crucially on the agents’ selectivity — likelihood that a potential match on the opposite side of the market will be acceptable— and their cost of search —cost of discovering the value of a potential match. SB38 206A-MCC Innovation: Choices and Constraints Invited: New Product Development Invited Session Chair: Pascale Crama, Singapore Management University, Singapore, Singapore, pcrama@smu.edu.sg 1 - The Role Of Form In Product Evolution: An Analysis Of Styles Tian Chan, Emory University, Atlanta, GA, 3, United States, tianheong.chan@insead.edu, Jurgen Mihm, Manuel Sosa Styles are groupings of product designs of similar form. We leverage on a recently introduced database of styles among the more than 350,000 US design patents granted from 1977 through 2010 to study how styles evolve over time. We study and theorize how the interactions between design, technology, and organizations lead to the emergence, growth, and decline of styles. We discuss the implications of our results in furthering the understanding of how products evolve. 2 - Implementing Corporate Entrepreneurship With Contests Lakshminarayana Nittala, University of California San Diego, La Jolla, CA, 92037, United States, lnittala@ucsd.edu, Sanjiv Erat, Viswanathan Krishnan We analyze the use of Innovation contests by firms as processes to implement corporate entrepreneurship. The cost benefit analysis of such internal contests brings forth interesting insights on the relation between the institutional features and profitability of such contests. 3 - Contracts With Reciprocal Buyout Options Pascale Crama, Singapore Management University, pcrama@smu.edu.sg, Niyazi Taneri Joint research and development (R&D) allows firms to combine complementary capabilities, but is difficult to organize in the face of uncertainties surrounding the future product and skills needed to bring it to market. We analyze how contracts with reciprocal buyout options can help to organize joint R&D to mutual advantage when the parties to the contract can invest in capability-building. SB39 207A-MCC Mean Field Models and Economic Applications Sponsored: Applied Probability Sponsored Session Chair: Ramesh Johari, Stanford University, Stanford, CA, United States, ramesh.johari@stanford.edu 1 - Mean Field Models For Economic Applications Ramesh Johari, Stanford University, ramesh.johari@stanford.edu This session will survey the use of mean field methods for analysis of strategic interactions in dynamic markets. Dynamic markets can be viewed as a significant special class of dynamic stochastic games; these are generally difficult to analyze, and these difficulties are only exacerbated when the number of players is large. We will discuss the use of large system asymptotics to simplify equilibrium characterization and market design. A significant emphasis will be on discussion of open applied directions for such methods. It will not be assumed that attendees are experts in dynamic games or economic modeling; the goal is to introduce applied probabilists to an exciting area of application.

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