Dynamical local models for segmentation and prediction of financial time series

In the analysis and prediction of many real-world time series, the assumption of stationarity is not valid. A special form of non-stationarity, where the underlying generator switches between (approximately) stationary regimes, seems particularly appropriate for financial markets. We introduce a new model which combines a dynamic switching (controlled by a hidden Markov model) and a non-linear dynamical system. We show how to train this hybrid model in a maximum likelihood approach and evaluate its performance on both synthetic and financial data.

Budget participation in Malaysian local authorites

This study examines the effect of budgetary participation on departmental performance via budget adequacy, organisational commitment and role ambiguity. The responses of 108 budget preparers and budget users drawn from a cross-section of Malaysian local authorities, to a questionnaire survey were analysed by using mediation analysis, path analysis and Pearson Product-Moment Correlation technique. The results suggest that budget adequacy, organisational commitment, and role ambiguity are important links in the process. The results of this study suggest that the relationship between budget participation and departmental performance is statistically, significantly, positively and marginally correlated. Of more interest was the finding that budget adequacy, organisational commitment, and role ambiguity are important intervening variables in the relationship between budget participation and departmental performance. The test for mediation effect, demonstrated that budget adequacy, organisational commitment, and role ambiguity had partially mediated the relationship of budget participation and departmental performance. These three variables act as partial mediators when they significantly reduced or decreased the path coefficient of budget participation and departmental performance rather than eliminating the relationship. Furthermore, the test for direct and indirect effect of budget participation on departmental performance, suggests that budget participation predicted or affected departmental performance more strongly in the indirect way than it did in a direct way. This suggests that, even though the correlation between budget participation and departmental performance was significant, the path interpretation suggests that the correlation arose because budget participation was correlated with other variables that have direct effect upon departmental performance not budget participation itself directly predicted departmental performance. Therefore, there is enough evidence to suggest that budget participation of budget preparers and budget users affects departmental performance of Malaysian local authorities indirectly via budget adequacy, organisational commitment and role ambiguity. Among the indirect effects, the link between budget participation, budget adequacy, organisational commitment, role ambiguity and departmental performance may be the most important in term of this study’s contribution. The decomposition of the observed correlation between budget participation, budget adequacy, organisational commitment and role ambiguity showed that budget 3 participation of budget preparers and budget users of Malaysian local authorities in the budget setting has direct effect on budget adequacy, organisational commitment and role ambiguity. Budget adequacy and organisational commitment was directly related. However, the relationship of role ambiguity and organisational commitment in this study was indirectly related. This suggests that participation of budget preparers and budget users in the budget setting of Malaysian local authorities lead to decrease role ambiguity that provide adequate budgetary supports, which lead to increase organisational commitment and thus enhance departmental performance. In relation to the strength of the relationships of the variables undertaken for the study, the overall relationships between variables are significant and positively related except that of role ambiguity relationship. The relationships of role ambiguity with budget participation, budget adequacy, organisational performance and departmental performance are negatively related.

Back to the local? Recalibrating the regional tier of governance in England

By contrast to the far-reaching devolution settlements elsewhere in the UK, political agreement on the governance of England outside London remains unsettled. There is cross- party consensus on the need to 'decentre down' authority to regions and localities, but limited agreement on how this should be achieved. This paper explores the welter of initiatives adopted by the recent Labour government that were ostensibly designed to make the meso-level of governance more coherent, accountable and responsive to meeting territorial priorities. Second, it explores the current Conservative-Liberal Democrat Coalition's programme of reform that involves the elimination of Labour's regional institutional architecture and is intended to restore powers to local government and communities and promote local authority co-operation around sub-regions. Labour's reforms were ineffective in achieving any substantial transfer of authority away from Whitehall and, given the Coalition's plans to cut public expenditure, the likelihood of any significant recalibration in central-local relations also appears improbable. © 2012 Copyright Taylor and Francis Group, LLC.