Jointly radial and translation homothetic preferences: generalized constant risk aversion

The paper identifies the structural restrictions on preferences required for them to exhibit both translation homotheticity in particular direction and radial homotheticity. The results are illustrated by an application to an asset allocation problem in the absence of riskless asset.

Supermodularity and risk aversion

In this paper, we consider the relationship between supermodularity and risk aversion. We show that supermodularity of the certainty equivalent implies that the certainty equivalent of any random variable is less than its mean. We also derive conditions under which supermodularity of the certainty equivalent is equivalent to aversion to mean-preserving spreads in the sense of Rothschild and Stiglitz. (c) 2006 Elsevier B.V. All rights reserved.

Price stabilization and the risk-averse firm

An analytically simple and tractable approach to firm-level welfare analysis of complete and partial mean-preserving price stabilization for producers with general risk-averse preferences facing a stochastic technology is developed. Necessary and sufficient conditions for price stabilization to be welfare enhancing are derived under different assumptions of the producer's preferences and the producer's technology. Existing stabilization results for the risk-averse firm are shown to be corollaries of these more general results.

Invariant risk attitudes

Concepts of constant absolute risk aversion and constant relative risk aversion have proved useful in the analysis of choice under uncertainty, but are quite restrictive, particularly when they are imposed jointly. A generalization of constant risk aversion, referred to as invariant risk aversion is developed. Invariant risk aversion is closely related to the possibility of representing preferences over state-contingent income vectors in terms of two parameters, the mean and a linearly homogeneous, translation-invariant index of riskiness. The best-known index with such properties is the standard deviation. The properties of the capital asset pricing model, usually expressed in terms of the mean and standard deviation, may be extended to the case of general invariant preferences. (C) 2003 Elsevier Inc. All rights reserved.

Increasing uncertainty: A definition

We present a definition of increasing uncertainty, in which an elementary increase in the uncertainty of any act corresponds to the addition of an 'elementary bet' that increases consumption by a fixed amount in (relatively) 'good' states and decreases consumption by a fixed (and possibly different) amount in (relatively) 'bad' states. This definition naturally gives rise to a dual definition of comparative aversion to uncertainty. We characterize this definition for a popular class of generalized models of choice under uncertainty.

Indexing and integrating multiple features for WWW images

In this paper, we present a novel indexing technique called Multi-scale Similarity Indexing (MSI) to index image's multi-features into a single one-dimensional structure. Both for text and visual feature spaces, the similarity between a point and a local partition's center in individual space is used as the indexing key, where similarity values in different features are distinguished by different scale. Then a single indexing tree can be built on these keys. Based on the property that relevant images have similar similarity values from the center of the same local partition in any feature space, certain number of irrelevant images can be fast pruned based on the triangle inequity on indexing keys. To remove the dimensionality curse existing in high dimensional structure, we propose a new technique called Local Bit Stream (LBS). LBS transforms image's text and visual feature representations into simple, uniform and effective bit stream (BS) representations based on local partition's center. Such BS representations are small in size and fast for comparison since only bit operation are involved. By comparing common bits existing in two BSs, most of irrelevant images can be immediately filtered. To effectively integrate multi-features, we also investigated the following evidence combination techniques-Certainty Factor, Dempster Shafer Theory, Compound Probability, and Linear Combination. Our extensive experiment showed that single one-dimensional index on multi-features improves multi-indices on multi-features greatly. Our LBS method outperforms sequential scan on high dimensional space by an order of magnitude. And Certainty Factor and Dempster Shafer Theory perform best in combining multiple similarities from corresponding multiple features.

Science-policy in environmental and health risk assessment: if we cannot do without, can we do better?

How can empirical evidence of adverse effects from exposure to noxious agents, which is often incomplete and uncertain, be used most appropriately to protect human health? We examine several important questions on the best uses of empirical evidence in regulatory risk management decision-making raised by the US Environmental Protection Agency (EPA)'s science-policy concerning uncertainty and variability in human health risk assessment. In our view, the US EPA (and other agencies that have adopted similar views of risk management) can often improve decision-making by decreasing reliance on default values and assumptions, particularly when causation is uncertain. This can be achieved by more fully exploiting decision-theoretic methods and criteria that explicitly account for uncertain, possibly conflicting scientific beliefs and that can be fully studied by advocates and adversaries of a policy choice, in administrative decision-making involving risk assessment. The substitution of decision-theoretic frameworks for default assumption-driven policies also allows stakeholder attitudes toward risk to be incorporated into policy debates, so that the public and risk managers can more explicitly identify the roles of risk-aversion or other attitudes toward risk and uncertainty in policy recommendations. Decision theory provides a sound scientific way explicitly to account for new knowledge and its effects on eventual policy choices. Although these improvements can complicate regulatory analyses, simplifying default assumptions can create substantial costs to society and can prematurely cut off consideration of new scientific insights (e.g., possible beneficial health effects from exposure to sufficiently low 'hormetic' doses of some agents). In many cases, the administrative burden of applying decision-analytic methods is likely to be more than offset by improved effectiveness of regulations in achieving desired goals. Because many foreign jurisdictions adopt US EPA reasoning and methods of risk analysis, it may be especially valuable to incorporate decision-theoretic principles that transcend local differences among jurisdictions.

Indexing text and visual features for WWW images

In this paper, we present a novel indexing technique called Multi-scale Similarity Indexing (MSI) to index imagersquos multi-features into a single one-dimensional structure. Both for text and visual feature spaces, the similarity between a point and a local partitionrsquos center in individual space is used as the indexing key, where similarity values in different features are distinguished by different scale. Then a single indexing tree can be built on these keys. Based on the property that relevant images haves similar similarity values from the center of the same local partition in any feature space, certain number of irrelevant images can be fast pruned based on the triangle inequity on indexing keys. To remove the ldquodimensionality curserdquo existing in high dimensional structure, we propose a new technique called Local Bit Stream (LBS). LBS transforms imagersquos text and visual feature representations into simple, uniform and effective bit stream (BS) representations based on local partitionrsquos center. Such BS representations are small in size and fast for comparison since only bit operation are involved. By comparing common bits existing in two BSs, most of irrelevant images can be immediately filtered. Our extensive experiment showed that single one-dimensional index on multi-features improves multi-indices on multi-features greatly. Our LBS method outperforms sequential scan on high dimensional space by an order of magnitude.