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Utility Maximization (utility + maximization)

Distribution by Scientific Domains
Business, Economics, Finance and Accounting71%

Selected Abstracts

Dual job holding general practitioners: the effect of patient shortage

HEALTH ECONOMICS, Issue 10 2009
Geir Godager
Abstract In 2001, a listpatient system with capitation payment was introduced in Norwegian general practice. After an allocation process where each inhabitant was listed with a general practitioner (GP), a considerable share of the GPs got fewer persons listed than they would have preferred. We examine whether GPs who experience a shortage of patients to a larger extent than other GPs seek to hold a second job in the community health service even though the wage rate is low compared with the wage rate in general practice. Assuming utility maximization, we model the effect of patient shortage on a GP's decision to contract for a second job in the community health service. The model predicts a positive relationship between patient shortage and participation in the community health service. This prediction is tested by means of censored regression analyses, taking account of labour supply as a censored variable. We find a significant effect of patient shortage on the number of hours the GPs supply to community health service. The estimated marginal effect is 1.72,hours per week. Copyright © 2008 John Wiley & Sons Ltd. [source]

The two faces of knowledge diffusion: the Chilean case

JOURNAL OF INTERNATIONAL DEVELOPMENT, Issue 1 2006
Piergiuseppe Morone
This paper analyses the dynamics of return to knowledge where knowledge is acquired through the combination of interactive and individual learning. We suggest that in light of this new definition of knowledge, choosing the optimal level of education is no longer an individual exercise of present and future utility maximization as suggested by formal human capital theory. We find that other external (environmental) variables might affect the individual decision of investment. We calculate the effect of individual and interactive learning on determining the wage of Chilean male workers resident in urban areas and aged between 14 and 65. Copyright © 2005 John Wiley & Sons, Ltd. [source]

Japanese Management Views on Overseas Exchange Listings: Survey Results

JOURNAL OF INTERNATIONAL FINANCIAL MANAGEMENT & ACCOUNTING, Issue 3 2001
Nobuyoshi Yamori
Although many theoretical papers support the hypothesis that overseas listings have a positive effect on stockholders' wealth, a few empirical studies cast doubts on this hypothesis. These studies suggest that the steady growth of overseas listings is motivated not only by the stockholders' wealth maximization, but also by other reasons, such as managers' utility maximization. However, information about management views on overseas listings is as yet inadequate to support or contradict this hypothesis. Following Baker and Pettit (1982) and Baker and Johnson (1990), both of which examined management's motives for domestic exchange listing, we used a questionnaire to obtain information on Japanese managers' views of their company's decision to list overseas. Our survey, mailed to the chief financial officers of 2,230 Japanese domestically-listed companies, shows that Japanese managers regard disclosure and financial reporting requirements as the primary obstacle to listing overseas. This is why many Japanese companies do not list their stocks on overseas stock exchanges despite the fact that they acknowledge the beneficial effects of overseas listings. [source]

Effective utility functions induced by organizational target-based incentives

MANAGERIAL AND DECISION ECONOMICS, Issue 4 2009
Ali E. Abbas
Many companies set performance targets for their divisions to decentralize the decision-making process and communicate with outside investors. This paper analyzes the effects of performance targets on the decision-making behavior of the divisions. We introduce the notion of an ,effective utility function',a function that a division should use in its selection of projects if it wishes to maximize the probability of achieving its targets. We show that many target-based incentives induce S-shaped utility functions and discuss the organizational problems they may pose. We then show how an organization can set targets that induce expected utility maximization. Copyright © 2008 John Wiley & Sons, Ltd. [source]

On the optimal portfolio for the exponential utility maximization: remarks to the six-author paper

MATHEMATICAL FINANCE, Issue 2 2002
Yuri M. Kabanov
This note contains ramifications of results of Delbaen et al. (2002). Assuming that the price process is locally bounded and admits an equivalent local martingale measure with finite entropy, we show, without further assumption, that in the case of exponential utility the optimal portfolio process is a martingale with respect to each local martingale measure with finite entropy. Moreover, the optimal value always can be attained on a sequence of uniformly bounded portfolios. [source]

Discrete choice and stochastic utility maximization

THE ECONOMETRICS JOURNAL, Issue 1 2003
Ruud H. Koning
Discrete choice models are usually derived from the assumption of random utility maximization. We consider the reverse problem, whether choice probabilities are consistent with maximization of random utilities. This leads to tests that consider the variation of these choice probabilities with the average utilities of the alternatives. By restricting the range of the average utilities we obtain a sequence of tests with fewer maintained assumptions. In an empirical application, even the test with the fewest maintained assumptions rejects the hypothesis of random utility maximization. [source]