Human Capital, the Structure of Production, and Growth

Recent decisions by the Spanish national competition authority (TDC) mandate payment systems to include only two costs when setting their domestic multilateral interchange fees (MIF): a fixed processing cost and a variable cost for the risk of fraud. This artificial lowering of MIFs will not lower consumer prices, because of uncompetitive retailing; but it will however lead to higher cardholders fees and, likely, new prices for point of sale terminals, delaying the development of the immature Spanish card market. Also, to the extent that increased cardholders fees do not offset the fall in MIFs revenue, the task of issuing new cards will be underpaid relatively to the task of acquiring new merchants, causing an imbalance between the two sides of the networks. Moreover, the pricing scheme arising from the decisions will cause unbundling and underprovision of those services whose costs are excluded. Indeed, the payment guarantee and the free funding period will tend to be removed from the package of services currently provided, to be either provided by third parties, by issuers for a separate fee, or not provided at all, especially to smaller and medium-sized merchants. Transaction services will also suffer the consequences that the TDC precludes pricing them in variable terms.

Price regulation of plastic money: A critical assessment of Spanish rules

Recent decisions by the Spanish national competition authority (TDC) mandate paymentsystems to include only two costs when setting their domestic multilateral interchange fees(MIF): a fixed processing cost and a variable cost for the risk of fraud. This artificiallowering of MIFs will not lower consumer prices, because of uncompetitive retailing; but itwill however lead to higher cardholders fees and, likely, new prices for point of saleterminals, delaying the development of the immature Spanish card market. Also, to the extent that increased cardholders fees do not offset the fall in MIFs revenue, the task of issuing new cards will be underpaid relatively to the task of acquiring new merchants, causing an imbalance between the two sides of the networks. Moreover, the pricing scheme arising from the decisions will cause unbundling and underprovision of those services whose costs are excluded. Indeed, the payment guarantee and the free funding period will tend to be removed from the package of services currently provided, to be either provided by third parties, by issuers for a separate fee, or not provided at all, especially to smaller and medium-sized merchants. Transaction services will also suffer the consequences that the TDC precludes pricing them in variable terms.

An application of capital allocation principles to operational risk

The cost of operational risk refers to the capital needed to a fford the loss generated by ordinary activities of a firm. In this work we demonstrate how allocation principles can be used to the subdivision of the aggregate capital so that the firm can distribute this cost across its various constituents that generate operational risk. Several capital allocation principles are revised. Proportional allocation allows to calculate a relative risk premium to be charged to each unit. An example of fraud risk in the banking sector is presented and some correlation scenarios between business lines are compared. Keywords: solvency, quantile, value at risk, copulas

From the “Mining Triangle” to the “Greater Region“ (“Großregion”/”Grande Région”). The Institutionalisation of the “SaarLorLux” Euroregion

Gairebé 182 milions d'ciutadans de la Unió Europea (= 37,5% de la població total) viuen en aproximadament 130 regions frontereres i transfrontereres. Aquestes regions contribueixen significativament al procés d'integració europea. Aquesta importància es documenta pel paquet dels Fons Estructurals 2007-2013, que ha estat presentat per la Comissió Europea i que va ser aprovat recentment pel Parlament Europeu. Considerant que la UE ha gastat uns 4875 € milions per a la cooperació transfronterera, transnacional i interregional en el marc de la iniciativa Interreg per al període 2000-2006, la cooperació territorial europea es convertirà en un dels tres objectius dels fons estructurals i rebrà € 7750000000 (5,57 milions d'euros per a la cooperació transfronterera només) per al període 2007-2013 (Comissió Europea, 2006a, 2006b). A part d'això, un nou conjunt de normes per a l'establiment d'una "agrupació europea de cooperació territorial" (AECT) ha estat adoptat i que facilitarà la cooperació transboundray, transnacional i interregional a la UE. Aquest treball s'ocuparà de les estructures de la institucionalització, la presa de decisions i l'execució i les polítiques de la "Gran Regió" / "Großregion" (d'ara endavant: GR o Gran Regió).

Loss risk through fraud in car insurance

Our objective is to analyse fraud as an operational risk for the insurance company. We study the effect of a fraud detection policy on the insurer's results account, quantifying the loss risk from the perspective of claims auditing. From the point of view of operational risk, the study aims to analyse the effect of failing to detect fraudulent claims after investigation. We have chosen VAR as the risk measure with a non-parametric estimation of the loss risk involved in the detection or non-detection of fraudulent claims. The most relevant conclusion is that auditing claims reduces loss risk in the insurance company.

Self-similarity of complex networks and hidden metric spaces

We demonstrate that the self-similarity of some scale-free networks with respect to a simple degree-thresholding renormalization scheme finds a natural interpretation in the assumption that network nodes exist in hidden metric spaces. Clustering, i.e., cycles of length three, plays a crucial role in this framework as a topological reflection of the triangle inequality in the hidden geometry. We prove that a class of hidden variable models with underlying metric spaces are able to accurately reproduce the self-similarity properties that we measured in the real networks. Our findings indicate that hidden geometries underlying these real networks are a plausible explanation for their observed topologies and, in particular, for their self-similarity with respect to the degree-based renormalization.

Young people and youth policies in Spain in times of austerity: between juggling and the trapeze

The aim of this article is to present and discuss the situation regarding young people and youth policy in Spain via the parameters of the magic triangle linking policy, research and action: (1) the situation of young people in Spain today -some indicators are highlighted regarding the main challenges and opportunities for young people, with references to the so-called"Ni-Nis" (neither studying nor working)- and the movement of the"outraged" youth that occupied the streets of Spain"s major cities in May 2011; (2) the current approaches adopted by public youth policies in Spain and limitations and difficulties encountered by the government in attempting to meet the demands of young people; (3) social work with young people and professionals involved in youth policies. In the last section, we conclude with some open questions and proposals for the immediate future

Organic chicken product authentication: state-of-the-art and future perspectives

Organic food products are highly susceptible to fraud. Currently, administrative controls are conducted to detect fraud, but having an analytical tool able to verify the organic identity of food would be very supportive. The state-of-the-art in food authentication relies on fingerprinting approaches that find characteristic analytical patterns to unequivocally identify authentic products. While wide research on authentication has been conducted for other commodities, the authentication of organic chicken products is still in its infancy. Challenges include finding fingerprints to discriminate organic from conventional products, and recruiting sample sets that cover natural variability. Future research might be oriented towards developing new authentication models for organic feed, eggs and chicken meat, keeping models updated and implementing them into regulations. Meanwhile, these models might be very supportive to the administrative controls directing inspections towards suspicious fraudulent samples.