An early warning system to identify house price bubbles

2019 ◽  
Vol 12 (3) ◽  
pp. 291-310
Author(s):  
Daniel Hagemann ◽  
Monika Wohlmann

Purpose The global financial and economic crisis resulting from the US housing crisis has shown that house prices can have far-reaching consequences for the real economy. For macroprudential supervision, it is, therefore, necessary to identify house price bubbles at an early stage to counteract speculative price developments and to ensure financial market stability. This paper aims to develop an early warning system to signal speculative price bubbles. Design/methodology/approach The results of explosivity tests are used to identify periods of excessive price increases in 18 industrialized countries. The early warning system is then based on a logit and an ordered logit regression, in which monetary, macroeconomic, regulatory, demographic and private factors are used as explanatory variables. Findings The empirical results show that monetary developments have the highest explanatory power for the existence of house price bubbles. Further, the study reveals currently emerging house price bubbles in Norway, Sweden and Switzerland. Practical implications The results implicate a new global housing boom, particularly in those countries that did not experience a major price correction during the global financial crisis. Originality/value The ordered logit model is an advanced approach that offers the advantage of being able to differentiate between different phases of a house price bubble, thereby allowing a multi-level assessment of the risk of speculative excesses in the housing market.

Author(s):  
Bertha Maya Sopha ◽  
Risqika Edni Doni Achsan ◽  
Anna Maria Sri Asih

Purpose Uneven distribution and mistarget beneficiaries are among problems encountered during post-disaster relief operations in 2010 Mount Merapi eruption. The purpose of this paper is to develop an empirically founded agent-based simulation model addressing the evacuation dynamics and to explore coordination mechanism and other promising strategies during last-mile relief delivery. Design/methodology/approach An agent-based model which was specified and parameterized by empirical research (interviews and survey) was developed to understand the mechanism of individual decision making underlying the evacuation dynamics. A set of model testing was conducted to evaluate confidence level of the model in representing the evacuation dynamics during post-disaster of 2010 Mount Merapi eruption. Three scenarios of last-mile relief delivery at both strategic and operational levels were examined to evaluate quantitatively the effectiveness of the coordination mechanism and to explore other promising strategies. Findings Results indicate that the empirically founded agent-based modeling was able to reproduce the general pattern of observable Internal Displaced Persons based on government records, both at micro and macro levels, with a statistically non-significant difference. Low hazard perception and leader-following behavior which refuses to evacuate are the two factors responsible for late evacuation. Unsurprisingly, coordination through information sharing results in better performance than without coordination. To deal with both uneven distribution and long-term demand fulfillment, coordination among volunteers during aid distribution (at downstream operation) is not sufficient. The downstream coordination should also be accompanied with coordination between aid centers at the upstream operation. Furthermore, the coordination which is combined with other operational strategies, such as clustering strategy, using small-sized trucks and pre-positioning strategy, seems to be promising. It appears that the combined strategy of coordination and clustering strategy performs best among other combined strategies. Practical implications The significant role of early evacuation and self-evacuation behavior toward efficient evacuation indicates that human factor (i.e. hazard perception and cultural factor) should be considered in designing evacuation plan. Early warning system through both technology and community empowerment is necessary to support early evacuation. The early warning system should also be accompanied with at least 69 percent of the population performing self-evacuation behavior for the effective evacuation. As information sharing through coordination is necessary to avoid redundant efforts, uneven distribution and eventually to reduce unmet demand, the government can act as a coordinating actor to authorize the operation and mobilize the resources. The combination of coordination and another strategy reducing lead time such as clustering analysis, thus increasing responsiveness, is seemly strategy for efficient and effective last-mile relief distribution. Originality/value Literature on coordination is dominated by qualitative approach, which is difficult to evaluate its effectiveness quantitatively. Providing realistic setting of the evacuation dynamics in the course of the 2010 Mount Merapi eruption, the empirically founded agent-based model can be used to understand the factors influencing the evacuation dynamics and subsequently to quantitatively examine coordination mechanisms and other potential strategies toward efficient and effective last-mile relief distribution.


2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Musabber Ali Chisty ◽  
Ashrafuzzaman Nazim ◽  
Md. Mostafizur Rahman ◽  
Syeda Erena Alam Dola ◽  
Nesar Ahmed Khan

PurposePersons with disabilities face the impacts of disasters differently. Early warning systems can be one of the powerful tools to reduce the vulnerabilities of persons with disabilities and mitigate the impacts of disasters. The main objective of this study was to assess the disability inclusiveness of the current early warning system (EWS) in flood-prone areas of Bangladesh.Design/methodology/approachA qualitative method was focused on getting in-depth information. Persons with disabilities participated in focus group discussions (FGDs) and shared the inclusiveness and gaps of the current EWS. Through extensive literature review, a checklist was developed to conduct the FGDs. QDA Miner 6.0.6 software was used for coding and analyzing the data.FindingsResults indicated that, though persons with disabilities have proper risk knowledge, the current monitoring and warning service, dissemination and communication, and response capability are not fully inclusive. A significant gap in the EWS was found in response capability. Even if somehow persons with disabilities manage to receive a warning about a flood, they lack the capacity to respond to the warning.Research limitations/implicationsThe study proposed that to make an EWS inclusive and effective, the concerned authorities should focus on all four parts of the EWS.Originality/valueStudies related to disability and disaster management are not very common. Conducting a qualitative study provided the persons with disabilities the opportunity to share their perspectives. Future studies can focus on vulnerability and capacity assessment of persons with disabilities to identify areas requiring interventions to enhance resilience.


Author(s):  
Abdulla Ali Alhmoudi ◽  
Zeeshan Aziz

Purpose The impacts and costs of natural disasters on people, properties and environment are often severe when these occur on a large scale and with no warning system in place. The lack of deployment of an early warning system (EWS), low risk and hazard knowledge and impact of natural hazard experienced by some communities in the UAE have emphasised the need for more effective EWSs. This work focuses on developing an integrated framework for EWSs for communities prone to the impact of natural hazards to reduce their vulnerability and improve emergency management arrangements in the UAE. Design/methodology/approach The essential elements of effective EWS were identified through literature review to develop an integrated framework for EWS. Semi-structured interviews and questionnaires were also used to identify and confirm hindering factors to deployment of effective EWSs in Abu Dhabi and Fujairah Emirates, while areas that require further development were also identified through this means. Findings The outcome of this research revealed that the warning for natural hazards in the UAE lacked the required elements for effective EWS, whereas the elements which are present are insufficient to mitigate the impacts of natural hazards. The information in this work emphasises the need to improve two elements, and to develop the other two essential elements of EWS in the UAE. Originality/value The outcome of this research revealed that the warning for natural hazards in the UAE lacked the required elements for effective EWS, whereas the elements which are present are insufficient to mitigate the impacts of natural hazards. The information in this work emphasises the need to improve two elements and to develop the other two essential elements of EWS in the UAE.


Author(s):  
Richard Haigh ◽  
Maheshika Menike Sakalasuriya ◽  
Dilanthi Amaratunga ◽  
Senaka Basnayake ◽  
Siri Hettige ◽  
...  

Purpose The purpose of this paper is to deliver a detailed analysis of the functioning of upstream–downstream interface process of the tsunami early warning and mitigation system in Sri Lanka. It also gives an understanding of the social, administrative, political and cultural complexities attached to the operation of interface mechanism, and introduces an analytical framework highlighting the significant dynamics of the interface of tsunami early warning system in Sri Lanka. Design/methodology/approach Through the initial literature review, a conceptual framework was developed, highlighting the criteria against which the interface process can be assessed. This framework was used as the basis for developing data collection tools, namely, documentary analysis, semi-structured interviews and observations that focused on the key stakeholder institutions in Sri Lanka. Thematic analysis was used to analyze the data according to the conceptual framework, and an improved and detailed framework was developed deriving from the findings. Findings The manner in which the interface mechanism operates in Sri Lanka’s tsunami early warning system is discussed, providing a detailed understanding of the decision-making structures; key actors; standardisation; technical and human capacities; socio-spatial dynamics; coordination among actors; communication and information dissemination; and the evaluation processes. Several gaps and shortcomings were identified with relation to some of these aspects, and the significance of addressing these gaps is highlighted in the paper. Practical implications A number of recommendations are provided to address the existing shortcomings and to improve the overall performance of tsunami warning system in Sri Lanka. Originality/value Based on the findings, a framework was developed into a more detailed analytical framework that depicts the interface operationalisation in Sri Lanka, and can also be potentially applied to similar cases across the world. The new analytical framework was validated through a focus group discussion held in Sri Lanka with the participation of experts and practitioners.


2021 ◽  
Vol 72 (02) ◽  
pp. 175-190
Author(s):  
MUHAMMAD ZAHID NAEEM ◽  
CRISTI SPULBAR ◽  
ABDULLAH EJAZ ◽  
RAMONA BIRAU ◽  
TIBERIU HORAȚIU GORUN ◽  
...  

Following the work of Kaminsky, Lizondo, and Reinhart (1997), Signals Extraction Approach has been adopted with some extensions for South-East Asian (SEA) region to investigate the performance of the technique as an Early Warning System (EWS) during Asian Financial Crisis (AFC) and Global Financial Crisis (GFC). This approach is very original in the context of investigating the impact on the dynamics of the textile industry in South-East Asia. Two additional approaches namely Signal to Noise Balance (STNB) and Kuipers Score (KS) have also been utilised. Outcome suggested that variables performed well both during AFC and GFC. However, predictive ability of variables was less during GFC compared to the AFC indicating that there may exist some complex phenomenon which requires composite statistical methods.


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