Environment-Based Life Cycle Decomposition (eLCD): Adaptation of EBD to Sustainable Design

As sustainability becomes increasingly important, product design is taking a proactive role in producing products that are both useful and sustainable. This paper introduces and discusses a tool named Environment-based life cycle decomposition (eLCD) to adapt the Environment-based Design (EBD) methodology to sustainable design. The eLCD brings to EBD three major features: 1) a holistic environment structure for sustainable conceptual design, 2) an effective and efficient tool for collecting information for sustainability decision-making, and 3) an analysis tool that takes sustainability as an integral part of the design rather than as a burden. The environment of a product is everything except the product itself, which can be defined in three dimensions, namely, environment types, life cycle events, and life cycle time. The environment types are designated as natural, built (including physical artifact and digital artifact), economic, and social environment. The eLCD provides an effective template for information collection to support the design decision-making process. The effectiveness of eLCD is demonstrated by its application to the upscaling of a wind turbine, where an energy storage system is introduced to make full use of wind energy with the least waste in serving the electricity demand.

Cycle Decompositions of Complete Digraphs

In this paper, we consider the problem of decomposing the complete directed graph $K_n^*$ into cycles of given lengths. We consider general necessary conditions for a directed cycle decomposition of $K_n^*$ into $t$ cycles of lengths $m_1, m_2, \ldots, m_t$ to exist and and provide a powerful construction for creating such decompositions in the case where there is one 'large' cycle. Finally, we give a complete solution in the case when there are exactly three cycles of lengths $\alpha, \beta, \gamma \neq 2$. Somewhat surprisingly, the general necessary conditions turn out not to be sufficient in this case. In particular, when $\gamma=n$, $\alpha+\beta > n+2$ and $\alpha+\beta \equiv n$ (mod 4), $K_n^*$ is not decomposable.

Optimizing Credit Gaps for Predicting Financial Crises: Modelling Choices and Tradeoffs

Credit gaps are good predictors for financial crises, and banking regulators recommend using them to inform countercyclical capital buffers for banks. Researchers typically create credit gap measures using trend-cycle decomposition methods, which require many modelling choices, such as the method used, and the smoothness of the underlying trend. Other choices hinge on the tradeoffs implicit in how gaps are used as early warning indicators (EWIs) for predicting crises, such as the preference over false positives and false negatives. We evaluate how the performance of credit-gap-based EWIs for predicting crises is influenced by these modelling choices. For the most common trend-cycle decomposition methods used to recover credit gaps, we find that optimally smoothing the trend enhances out-of-sample prediction. We also show that out-of sample performance improves further when we consider a preference for robustness of the credit gap estimates to the arrival of new information, which is important as any EWI should work in real-time. We offer several practical implications.

Laplace, Hansen-Sargent and Beveridge-Nelson a note towards unified business application

The paper derives the equivalence condition between the Beveridge-Nelson decomposition and the Hansen-Sargent prediction formula in continuous time using Laplace transforms. The results presented show how the Hansen-Sargent prediction formula is relevant not just for present value discounting but also for the trend-cycle decomposition of cash flow streams in corporate finance.

Cycle decomposition for the permutations of an infinite set

We present two cycle decompositions for the permutations of an infinite set.