A Bayesian formulation of search, control and the exploration/exploitation trade-off

A new approach to optimisation is introduced based on a precise probabilistic statement of what is ideally required of an optimisation method. It is convenient to express the formalism in terms of the control of a stationary environment. This leads to an objective function for the controller which unifies the objectives of exploration and exploitation, thereby providing a quantitative principle for managing this trade-off. This is demonstrated using a variant of the multi-armed bandit problem. This approach opens new possibilities for optimisation algorithms, particularly by using neural network or other adaptive methods for the adaptive controller. It also opens possibilities for deepening understanding of existing methods. The realisation of these possibilities requires research into practical approximations of the exact formalism.

The return of the Prince of Denmark: a survey on recent developments in the economics of innovation

It is well known that innovation is the engine that drives the growth machine of modern capitalist economies. Therefore, not surprisingly, substantial attention has been devoted by economists to the process behind the production of innovations. Three areas have recently emerged as relevant in the field. These are: the impact of spillovers on productivity; the different forms of R&D cooperation and the role of patents in fostering innovations when these are cumulative. In this paper I summarise the relevant literature in these three areas by discussing where the current literature stands and what are its future developments.

New dimensions on the economics of the entrepreneurial process

This thesis examines the transition of employees into entrepreneurship, with particular emphasis on the role of workplace characteristics in influencing this movement. The first main chapter examines whether the determinants of becoming an intrapreneur differ from those that support transitions into independent entrepreneurship. The results show that intrapreneurs resemble employees rather than entrepreneurs, contrary to what the entrepreneurship theory would suggest. Yet it shows that those intrapreneurs that expect to acquire an ownership stake in the business, unlike the rest of intrapreneurs, possess traditional entrepreneurial traits. Chapter 3 investigates how workers’ degree of specialisation determines their decision to found a firm. It shows that entrepreneurs emerging from small firms, i.e. generalists, transfer knowledge from more diverse aspects of the business and create firms more related to the main activity of their last employer. Workers in large firms, however, benefit from higher returns to human capital that increase their opportunity costs to switch to entrepreneurship. Since becoming an entrepreneur would make part of their specialised skills unutilised, the minimum quality of the idea at which they would be willing to leave will be higher and, therefore, entrepreneurs emerging from large firms will be of highest quality. Chapter 4 analyses whether the reason to terminate an employment contract is associated with the fact that the majority of entrepreneurs appear to set up their business after having worked for a small firm. Moreover, it studies how this pattern varies as the labour market conditions worsen. The effect of layoffs turns out to be a key driver in the entry to entrepreneurship and it is found to exert a greater effect the smaller the firm workers are dismissed from. This has been reflected in an overall larger flow of employees from small firms moving into entrepreneurship over the recession.

Finding qualitative research: an evaluation of search strategies

Background Qualitative research makes an important contribution to our understanding of health and healthcare. However, qualitative evidence can be difficult to search for and identify, and the effectiveness of different types of search strategies is unknown. Methods Three search strategies for qualitative research in the example area of support for breast-feeding were evaluated using six electronic bibliographic databases. The strategies were based on using thesaurus terms, free-text terms and broad-based terms. These strategies were combined with recognised search terms for support for breast-feeding previously used in a Cochrane review. For each strategy, we evaluated the recall (potentially relevant records found) and precision (actually relevant records found). Results A total yield of 7420 potentially relevant records was retrieved by the three strategies combined. Of these, 262 were judged relevant. Using one strategy alone would miss relevant records. The broad-based strategy had the highest recall and the thesaurus strategy the highest precision. Precision was generally poor: 96% of records initially identified as potentially relevant were deemed irrelevant. Searching for qualitative research involves trade-offs between recall and precision. Conclusions These findings confirm that strategies that attempt to maximise the number of potentially relevant records found are likely to result in a large number of false positives. The findings also suggest that a range of search terms is required to optimise searching for qualitative evidence. This underlines the problems of current methods for indexing qualitative research in bibliographic databases and indicates where improvements need to be made.

The economics of copyright

The copyright industries — such as music, film, software and publishing — occupy a significant and growing share of economic activity. Current copyright law protects the creator for up to 70 years after their death, significantly longer than patent protection (20 years after invention). Copyright law aims to balance the incentive to create new work against the costs associated with high prices and restricted access to this work. This paper reviews the economic issues behind copyright and how these are challenged by changes in technology and market structure. While economics provides a powerful conceptual framework for understanding the trade-offs involved, the paper argues that our empirical knowledge base is very weak. Much more empirical analysis is needed to understand the impacts of changes to copyright legislation. Without such analysis, policy and legal debates will continue to be based largely on anecdote and rhetoric.

Exits, entrances and entrepreneurship : an exploration of economic theories of entrepreneurship through new independent entry and infant exit

The thesis began as a study of new firm formation. Preliminary research suggested that infant death rate was considered to be a closely related problem and the search was for a theory of new firm formation which would explain both. The thesis finds theories of exit and entry inadequate in this respect and focusses instead on theories of entrepreneurship, particularly those which concentrate on entrepreneurship as an agent of change. The role of information is found to be fundamental to economic change and an understanding of information generation and dissemination and the nature and direction of information flows is postulated to lead coterminously to an understanding of entrepreneurhsip and economic change. The economics of information is applied to theories of entrepreneurhsip and some testable hypotheses are derived. The testing relies on etablishing and measuring the information bases of the founders of new firms and then testing for certain hypothesised differences between the information bases of survivors and non-survivors. No theory of entrepreneurship is likely to be straightforwardly testable and many postulates have to be established to bring the theory to a testable stage. A questionnaire is used to gather information from a sample of firms taken from a new micro-data set established as part of the work of the thesis. Discriminant Analysis establishes the variables which best distinguish between survivors and non-survivors. The variables which emerge as important discriminators are consistent with the theory which the analysis is testing. While there are alternative interpretations of the important variables, collective consistency with the theory under test is established. The thesis concludes with an examination of the implications of the theory for policy towards stimulating new firm formation.

The making of an ideology of the third way:the evolution of christian democracy in Germany (with special reference to 1945-49)

This study investigates the search for the third way in the history of German Christian Democracy. Today, in the United Kingdom, the 'third way' is seen as a new phenomenon, a synthesis of post-war belief in the welfare state and neo-liberal conservatism. Yet it insufficiently acknowledges that the origins of third way thinking, the marriage of social justice with free market economics, of individualism with collective responsibility, are found in the early philosophies of Catholic Social Theory and Protestant Social Ethical Teaching in Germany. This study shows that in the hundred years from the 1840s to the end of the 1940s, there were Catholic and Protestant socio-ethical thinkers and political reformists in Germany who attempted to bridge the philosophical differences between liberalism and socialism, to develop a socio-economic order based on Christian moral values. It will focus on the period 1945-1949, when the CDU was founded as the first interdenominational, Christian party. The study provides the first comprehensive account of the political debates in Christian democratic groups in the Soviet, British, French and American allied occupied zones, also giving equal attention to the contribution from the Protestant wing, alongside the more widely acknowledged role of Catholics in the birth of the CDU. It examines how Christian Democrats envisaged correcting the aberrations of German history, by uniting all social classes and Christian religions in one all-embracing Volkspartei, and transforming party politics from its earlier obsession with sectarian and ideological interests towards a more pragmatic 'third way' programme. The study argues that through the making of its ideology, the CDU modified the nation's understanding of its history, re-interpreted its traditions, and redefined the meaning and perception of established political philosophies. This reveals how the ambiguity of political terminology, and the flexible practice of 'third way' politics, were an invaluable political resource in the CDU's campaign for unity, ideological legitimisation and political power.

Reflections on five years of evaluating semantic search systems

Evaluations of semantic search systems are generally small scale and ad hoc due to the lack of appropriate resources such as test collections, agreed performance criteria and independent judgements of performance. By analysing our work in building and evaluating semantic tools over the last five years, we conclude that the growth of the semantic web led to an improvement in the available resources and the consequent robustness of performance assessments. We propose two directions for continuing evaluation work: the development of extensible evaluation benchmarks and the use of logging parameters for evaluating individual components of search systems.

The effects of offshoring to China:reallocation, employment and productivity in Taiwan

We examine the extent to which outward FDI from Taiwan to mainland China has contributed to the rising unemployment rate in Taiwan. Further, it examines whether outward FDI has contributed to productivity growth in Taiwan, and the importance of linkages between sectors in determining these effects. We provide strong evidence that Taiwanese firms have increased their investments in China, and that this has lead to a reduction in employment in such sectors at home. Further, we show that these effects are also translated up the supply chain, such that outward FDI also leads to a reduction in employment upstream in the supply chain.

Local industrial systems and the location of FDI in Italy

This article investigates the determinants of foreign direct investment (FDI)location across Italian provinces. Specifically it examines the relationship between industry- specific local industrial systems and the location of inward FDI. This extends previous analysis beyond the mere density of activity, to illustrate the importance of the specific nature of agglomerations in attracting inward investment. The article develops a model of FDI location choice using a unique FDI database stratified by industry and province. The results also suggest that the importance of agglomeration differs between industries, and offers some explanation for this.

Foreign direct investment, transactions linkages, and the performance of the domestic sector

Using data from the UK Census of Production, including foreign ownership data, and information from UK industry input-output tables, this paper examines whether the intensity of transactions linkages between foreign and domestic firms affects productivity growth in domestic manufacturing industries. The implications of the findings for policies promoting linkages between multinational and domestic firms in the UK economy are outlined.

Some further empirical evidence on the impact of oil price changes on petrol prices

This paper analyses the asymmetries in the response of petrol prices to oil price shocks. We show that previous work, based on the determination of asymmetric responses, can be improved upon by allowing for asymmetries in short term dynamics. The paper shows that a significant determinant of the response of petrol prices to oil price changes, is the extent to which petrol price can be seen to have departed from its long run equilibrium level.

Regulation of the petrol industry in the UK: issues and evidence

The petrol industry has been investigated twice by the Monopolies and Mergers Commission in the last 20 years. On both occasions the MMC found that the conduct of the companies was not against the public interest. These findings were based on the perceived stable relationship between oil and petrol prices. This paper develops a model of petrol price using a co-integration approach, concluding that one must question the findings of the MMC.

Employment effects of privatisation and foreign acquisition of Chinese state-owned enterprises

This paper investigates the effects of domestic privatisation or foreign acquisition of Chinese State Owned Enterprises (SOEs) on employment growth, using firm level data for China and a combination of propensity score matching and difference-in-differences in order to identify the causal effect. Our results suggest that, controlling for output growth there is some evidence that domestic privatisation leads to contemporaneous reductions in employment growth compared to firms that did not undergo an ownership change. By contrast, there is some evidence that foreign acquisitions show higher employment growth in the post acquisition period than non-acquired SOEs.