Jose M. Pavía

Credit card incidents and control systems

Abstract Credit and debit cards have spread and skyrocketed all around the world to become the most popular means of payments in many countries. Despite their enormous popularity, cards are not free of risk. Technology development and e-commerce have exponentially increased internal credit card incidents. This paper identifies and quantifies the different types of credit card fraud and puts into question the effectiveness of the role assigned to cardholders in its detection.

Election Forecasts Using Spatiotemporal Models

There exists a large literature on the problem of forecasting election results. But none of the published methods take spatial information into account, although there is clear evidence of geographic trends. To fill this gap, we use geostatistical procedures to build a spatial model of voting patterns. We test the model in three close elections and find that it outperforms rival methods in current use. We apply kriging (a spatial model) and cokriging (in a spatiotemporal model version) to improve the accuracy of election night forecasts. We compare the results with actual outcomes and also to predictions made using models that use only historical data from polling stations in previous elections. Despite the apparent volatility leading up to the three elections in our study, the use of spatial information strongly improves the accuracy of the prediction. Compared with forecasts using historical data alone, the spatiotemporal models are better whenever the proportion of counted votes in the election night tally exceeds 5%%.

Updating input–output matrices: assessing alternatives through simulation

A problem that frequently arises in economics, demography, statistics, transportation planning and stochastic modelling is how to adjust the entries of a matrix to fulfil row and column aggregation constraints. Biproportional methods in general and the so-called RAS algorithm in particular, have been used for decades to find solutions to this type of problem. Although alternatives exist, the RAS algorithm and its extensions are still the most popular. Apart from some interesting empirical and theoretical properties, tradition, simplicity and very low computational costs are among the reasons behind the great success of RAS. Nowadays computer hardware and software have made alternative procedures equally attractive. This work analyses, through simulation, the performance of RAS and some minimands when matrix coefficients vary following different schemes of change. Results suggest RAS algorithm as the best option when variations in coefficients are proportional to their size, while the method based on minimizing squared differences is seen to be the best alternative when the standard deviations of variations are either constant, variable, or an inverse function of matrix entries.

Classifying Regions for European Development Funding

Structural and cohesion funds play a prominent role in European Union regional policy, which aims to reduce gaps in development between regions and disparities in well-being between European citizens. The regions and areas eligible for funding — 308,000 million during the 2007—13 period — are chosen according to regional GDP per inhabitant as the variable of reference. Despite the great importance of this indicator, the complex socioeconomic reality of regions cannot be fully explained by means of a single variable. Hence, using the large number of variables on economic, political, cultural and demographic characteristics available at regional level, this article groups European regions into homogeneous clusters. This makes it possible to identify the weak and strong points of each group of regions and to ascertain what type of action should be promoted and, therefore, funded in each region.

Determinants of profitability in Spanish financial institutions. Comparing aided and non-aided entities

The last financial crisis has led to the greatest contribution of public funds ever made to Spanish banks. This paper studies why the need for support has been asymmetric, with not all of the institutions requiring aid. Based on profitability of assets (ROA), we determine using panel data econometric and logit response models the components of profit and loss accounts that generated profitability as well as the factors leading to some entities to ask for aid. The analyses show that before the beginning of the crisis there were significant differences between entities that needed aid and those that did not. The most profitable banks grounded their success in the traditional revenue components of financial institutions (such as margin on interest rates and commissions), as well as in revenues obtained from participated companies and extraordinary results. The model offers a tool to detect entities in difficulties in advance, reducing the financial and social costs of public interventions. The factors more impacting on profitability of Spanish institutions are also identified.

On distributing quarterly national growth among regions

In many countries a very important fraction of public expenditure is managed by regional authorities. However, in a world where economic life has quickened and become more turbulent, subnational institutions rarely have a timely regional macroeconomic picture at their disposal. The authors propose a guide to a method for estimating quarterly accounts of regions from the national quarterly and annual regional accounts, by the use of a temporal structure which eliminates possible spurious jumps. The robustness of the process and suggested practicalities are tested, and the proposal is also shown to produce better estimates than other uniregional methods often used in this framework.

EstimatingJ (>1) quarterly time series in fulfilling annual and quarterly constraints

This paper addresses the problem of joint disaggregating a group of time series when their temporal aggregation values and their contemporaneous aggregation are known and when a number of related series in the desired frequency are available. The focus is on temporal distribution of annual series. This problem was treated before by other authors but they did not solve the problem of spurious steps which usually emerge in this framework. Proposed here is the simplest hypothesis congruent with reality that solves this difficulty. An algorithm is proposed to use these hypotheses in empirical works.

Rich regions, poor regions and bank branch deregulation in Spain

ABSTRACT Rich regions, poor regions and bank branch deregulation in Spain. Regional Studies. The links between financial deregulation and economic performance are evaluated in a European context. Specifically, the study analyses the relaxation of bank branching restrictions in Spain, which triggered a remarkable interregional expansion of savings banks that coincided with an unprecedented period of sustained economic expansion. Although related questions have been widely investigated for the United States, experiences in Europe have received far less research attention. An additional contribution of the paper lies in its use of quantile regression, which enables the investigation of the possibility of economic effects taking into account the degree of regional development. The potential endogeneity of some of the regressors is also explicitly considered. Results do not support the case for a positive effect of bank branch deregulation in Spain. Out-of-region entry, in particular, does not seem to have had any specific positive effect on regional development, and this result is quite homogeneous across provinces regardless of their relative wealth.

Assessing implicit hypotheses in life table construction

Abstract Mortality figures are of capital importance for policy-making and public planning, as in forecasting financial provisions in public pension systems. General population life tables are constructed from aggregated statistics, an issue that usually entails adopting some (implicit) assumptions in their construction, such as the hypothesis of closed demographic system or the hypotheses of uniform distributions of death counts (and migration events) by age and calendar year. As microdata have become more abundant and reliable, these hypotheses could be assessed and more assumption-free estimators employed. Using a real database from Spain, we show that the above hypotheses are not appropriate in general and that the more efficient estimators proposed in this paper should be promoted, as differences persist depending on the estimator computed.

The formation of aggregate expectations: wisdom of the crowds or media influence?

ABSTRACT The general elections of 2015 in Spain were elections of change. Two new parties for which voters had no previous historical reference points burst onto the parliamentary scene. Two (partially) opposed theories vie to offer an explanation as to how voters build their aggregate electoral expectations. In this paper, we investigate which mechanism has the greatest influence on the formation of expectations: published opinion or social interactions. Likewise, we also study if there is an ideological bias in the voters’ perception of the future results of the electoral battle. Based on analysis of microdata from a survey (sample size = 14,262) conducted in Spain on the occasion of the general elections of 2015, we provide evidence: firstly, that the published surveys are the main source used by voters to configure their aggregate expectations; and secondly, that the interpretation and projection that voters make about reality is not neutral, but strongly influenced by their own beliefs and preferences.