A Note on Proxy Variables and Instrument Variable Regression

This is a note about proxy variables and instruments for identification of structural parameters in regression models. We have experienced that in the econometric textbooks these two issues are treated separately, although in practice these two concepts are very often combined. Usually, proxy variables are inserted in instrument variable regressions with the motivation they are exogenous. Implicitly meaning they are exogenous in a reduced form model and not in a structural model. Actually if these variables are exogenous they should be redundant in the structural model, e.g. IQ as a proxy for ability. Valid proxies reduce unexplained variation and increases the efficiency of the estimator of the structural parameter of interest. This is especially important in situations when the instrument is weak. With a simple example we demonstrate what is required of a proxy and an instrument when they are combined. It turns out that when a researcher has a valid instrument the requirements on the proxy variable is weaker than if no such instrument exists

Statistical bound of genetic solutions to quadratic assignment problems

Quadratic assignment problems (QAPs) are commonly solved by heuristic methods, where the optimum is sought iteratively. Heuristics are known to provide good solutions but the quality of the solutions, i.e., the confidence interval of the solution is unknown. This paper uses statistical optimum estimation techniques (SOETs) to assess the quality of Genetic algorithm solutions for QAPs. We examine the functioning of different SOETs regarding biasness, coverage rate and length of interval, and then we compare the SOET lower bound with deterministic ones. The commonly used deterministic bounds are confined to only a few algorithms. We show that, the Jackknife estimators have better performance than Weibull estimators, and when the number of heuristic solutions is as large as 100, higher order JK-estimators perform better than lower order ones. Compared with the deterministic bounds, the SOET lower bound performs significantly better than most deterministic lower bounds and is comparable with the best deterministic ones. 

On statistical bounds of heuristic solutions to location problems

Solutions to combinatorial optimization problems, such as problems of locating facilities, frequently rely on heuristics to minimize the objective function. The optimum is sought iteratively and a criterion is needed to decide when the procedure (almost) attains it. Pre-setting the number of iterations dominates in OR applications, which implies that the quality of the solution cannot be ascertained. A small, almost dormant, branch of the literature suggests using statistical principles to estimate the minimum and its bounds as a tool to decide upon stopping and evaluating the quality of the solution. In this paper we examine the functioning of statistical bounds obtained from four different estimators by using simulated annealing on p-median test problems taken from Beasley’s OR-library. We find the Weibull estimator and the 2nd order Jackknife estimator preferable and the requirement of sample size to be about 10 being much less than the current recommendation. However, reliable statistical bounds are found to depend critically on a sample of heuristic solutions of high quality and we give a simple statistic useful for checking the quality. We end the paper with an illustration on using statistical bounds in a problem of locating some 70 distribution centers of the Swedish Post in one Swedish region. 

A stopping rule while searching for optimal solution of facility-location

Solutions to combinatorial optimization, such as p-median problems of locating facilities, frequently rely on heuristics to minimize the objective function. The minimum is sought iteratively and a criterion is needed to decide when the procedure (almost) attains it. However, pre-setting the number of iterations dominates in OR applications, which implies that the quality of the solution cannot be ascertained. A small branch of the literature suggests using statistical principles to estimate the minimum and use the estimate for either stopping or evaluating the quality of the solution. In this paper we use test-problems taken from Baesley's OR-library and apply Simulated Annealing on these p-median problems. We do this for the purpose of comparing suggested methods of minimum estimation and, eventually, provide a recommendation for practioners. An illustration ends the paper being a problem of locating some 70 distribution centers of the Swedish Post in a region.

How does the use of different road networks effect the optimal location of facilities in rural areas?

The p-median problem is often used to locate P service facilities in a geographically distributed population. Important for the performance of such a model is the distance measure. Distance measure can vary if the accuracy of the road network varies. The rst aim in this study is to analyze how the optimal location solutions vary, using the p-median model, when the road network is alternated. It is hard to nd an exact optimal solution for p-median problems. Therefore, in this study two heuristic solutions are applied, simulating annealing and a classic heuristic. The secondary aim is to compare the optimal location solutions using dierent algorithms for large p-median problem. The investigation is conducted by the means of a case study in a rural region with an asymmetrically distributed population, Dalecarlia. The study shows that the use of more accurate road networks gives better solutions for optimal location, regardless what algorithm that is used and regardless how many service facilities that is optimized for. It is also shown that the simulated annealing algorithm not just is much faster than the classic heuristic used here, but also in most cases gives better location solutions.

Predicting entry of Swedish wholesale firms into local markets

Applying microeconomic theory, we develop a forecasting model for firm entry into local markets and test this model using data from the Swedish wholesale industry. The empirical analysis is based on directly estimating the profit function of wholesale firms. As in previous entry studies, profits are assumed to depend on firm- and location-specific factors,and the profit equation is estimated using panel data econometric techniques. Using the residuals from the profit equation estimations, we identify local markets in Sweden where firm profits are abnormally high given the level of all independent variables included in the profit function. From microeconomic theory, we then know that these local markets should have higher net entry than other markets, all else being equal, and we investigate this in a second step,also using a panel data econometric model. The results of estimating the net-entry equation indicate that four of five estimated models have more net entry in high-return municipalities, but the estimated parameter is only statistically significant at conventional levels in one of our estimated models.

The Nurse Professional Competence (NPC) scale : self-reported competence among nursing students on the point of graduation

BACKGROUND: International organisations, e.g. WHO, stress the importance of competent registered nurses (RN) for the safety and quality of healthcare systems. Low competence among RNs has been shown to increase the morbidity and mortality of inpatients. OBJECTIVES: To investigate self-reported competence among nursing students on the point of graduation (NSPGs), using the Nurse Professional Competence (NPC) Scale, and to relate the findings to background factors. METHODS AND PARTICIPANTS: The NPC Scale consists of 88 items within eight competence areas (CAs) and two overarching themes. Questions about socio-economic background and perceived overall quality of the degree programme were added. In total, 1086 NSPGs (mean age, 28.1 [20-56]years, 87.3% women) from 11 universities/university colleges participated. RESULTS: NSPGs reported significantly higher scores for Theme I "Patient-Related Nursing" than for Theme II "Organisation and Development of Nursing Care". Younger NSPGs (20-27years) reported significantly higher scores for the CAs "Medical and Technical Care" and "Documentation and Information Technology". Female NSPGs scored significantly higher for "Value-Based Nursing". Those who had taken the nursing care programme at upper secondary school before the Bachelor of Science in Nursing (BSN) programme scored significantly higher on "Nursing Care", "Medical and Technical Care", "Teaching/Learning and Support", "Legislation in Nursing and Safety Planning" and on Theme I. Working extra paid hours in healthcare alongside the BSN programme contributed to significantly higher self-reported scores for four CAs and both themes. Clinical courses within the BSN programme contributed to perceived competence to a significantly higher degree than theoretical courses (93.2% vs 87.5% of NSPGs). SUMMARY AND CONCLUSION: Mean scores reported by NSPGs were highest for the four CAs connected with patient-related nursing and lowest for CAs relating to organisation and development of nursing care. We conclude that the NPC Scale can be used to identify and measure aspects of self-reported competence among NSPGs.

Manager's task to support integrated autonomy at the workplace : Results from an intervention

A new managerial task arises in today’s working life: to provide conditions for and influence interaction between actors and thus to enable the emergence of organizing structure in tune with a changing environment. We call this the enabling managerial task. The goal of this paper is to study whether training first line managers in the enabling managerial task could lead to changes in the work for the subordinates. This paper presents results from questionnaires answered by the subordinates of the managers before and after the training. The training was organized as a learning network and consisted of eight workshops carried out over a period of one year (September 2009–June 2010), where the managers met with each other and the researchers once a month. Each workshop consisted of three parts, during three and a half hours. The first hour was devoted to joint reflection on a task that had been undertaken since the last workshop; some results were presented from the employee pre-assessments, followed by relevant theory and illuminating practices, finally the managers created new tasks for themselves to undertake during the following month. The subordinates’ answers show positive change in all of the seventeen scales used to assess it. The improvements are significant in scales measuring the relationship between the manager and the employees, as well as in those measuring interaction between employees. It is concluded that the result was a success for all managers that had the possibility of using the training in their management work.