Friday, May 30, 2014

Those Great Commencement Speeches

I always enjoy this time of year in which we celebrate the successes of our students, friends, and children, through various graduation ceremonies.

Some graduations, both high school ones and college ones, are still taking place and it is fun to follow the various commencement speakers, the coverage of their speeches, and even to learn from some of them.

Although I am back in Sweden, I am still following many graduation events and speakers and trying to capture any pearls of wisdom.

The reporting on commencement speakers starts several months before the actual graduations and this year I especially enjoyed the list of Most Notable Commencement Speakers for 2014 compiled by Business Insider. Alright, I am a bit biased since both UMass Amherst's speaker, Governor Deval Patrick, made the list as well as my husband's undergrad alma mater's, Lafayette College's, which featured the Prime Minister of Jamaica, Portia Simpson Miller. The fomer mayor of NYC, Michael Bloomberg,  also made the list and has been quite busy, just recently having given a provocative speech at Harvard. He is also the scheduled commencement speaker for Williams College.

Interestingly, two originally scheduled female commencement speakers, former Secretary of State Condi Rice, and the Managing Director of the International Monetary Fund, Christine Lagarde, who were to speak at Rutgers University and Smith College, respectively, ultimately, because of demonstrations, never spoke at the commencements. Bloomberg at his commencement speech at Harvard assailed the lack of suppiort for the diversity of ideas at universities, and even pointed out what happened at my alma matter, Brown University, when his former police chief, Kelly, tried to speak there a few months ago.

And, when it comes to great high school commencement speakers, just the other day, the 2014 Deerfield Academy graduation took place. When my daughter graduated from this outstanding school I could not resist blogging about it and posted a lot of photos. Even former President Bill Clinton made a suprise appearance in a video.  The 2014 Deerfield Academy commencement speaker was H. Rodgin Cohen, a renowned financial lawyer. Interestingly, on a USAir flight to Washington DC a few years ago,  I sat next to "Rodge," if  I may. I had noticed this very well-dressed gentelman wearing a bowtie in the boarding area for our flight at Bradley Airport and, honestly, I was hoping that he would be seated to me. (I tend to have amazing seatmates on many of my flights, and this was another one of those cases).  I got the window seat towards the front of the plane and Rodge sat right next to me in the aisle seat. Before long, a conversation ensued, with business cards exchanged. When he told me that he was a member of the Deerfield Academy (DA) Board of Trustees and had gone to Harvard (including Harvard Law), we talked almost nonstop. He even mentioned Ms. Carole Pennock, the Head of the lower school of The Bement School, who had also served on the DA board (and was a wonderful influence on my daughter and her cohort when they went to Bement).

Mr. Cohen is the senior chairman of the top law firm Sullivan and Cromwell. And his financial regulatory expertise  in major financial crises was even featured in the HBO film, *Too Big to Fail."

Well, would you believe, now, every year since our meeting on that flight, I receive a Season's Greeting card from Mr. Cohen!  His DA speech is now posted and it is inspiring - the importance of being quirky and bonding with even Lehman Brothers thrown in!

I have given 3 commencement speeches, thus far, one at the Isenberg School, and two, in Sweden. In preparing these, it was a great opportunity to reflect, to acknowledge, and also to give back. Thanks!

For anyone interested, links to my speeches, and other writings, including those in the popular press, can be accessed here.

Congratulations to all the graduates!

Tuesday, May 27, 2014

Information Asymmetry vs. Transparency and Why It Matters to Consumers and Investors

Recently, we have been devoting a lot of time to investigating information asymmetry, whether from a quality perspective, a time perspective, or a sustainability one.

Information matters and is crucial to good decision-making and, even in a world dominated by the Internet, with many experiencing information overload,  obtaining the right information at the right time may not be attainable.

Having incomplete information can also lead to bad decisions and losses in investments.

Coincidentally, in a recent Financial Times OpEd, dated May 20, 2014, the former mayor of NYC, who needs no introduction whatsoever, Michael Bloomberg, and Mary Schapiro, the former chair of the US Securities and Exchange Commission, write on precisely this issue. Their OpEd,  "Give investors access to all the information they need," is a MUST read! They begin their eloquent and extremely timely OpEd with the statement: The most valuable currency in financial markets is reliable information. They note that in a 2014 study it was found that 2/3 of global investors evaluate non-financial disclosures. However, only half of this group uses a structured process to make their assessments. They emphasize the importance of climate risk, quality issues, as in adulterated pharmaceutical products, and even data security issues and financial fraud. They note the organization established in 2011 that they serve as chair and co-chair of, respectively, the Sustainability Accounting Standards Board, that is working with US-listed companies and investors to establish industry-specific measurement and reporting standards on non-financial data.

Transparency  matters and can assist in both competitiveness and resiliency. And, clearly, Bloomberg speaks from a wealth of know-how and practical experience - just remember the impact of SuperStorm Sandy on NYC and surrounding areas!

As for our research in this domain, I am very pleased to note that our paper, Equilibria and Dynamics of Supply Chain Network Competition with Information Asymmetry in Quality and Minimum Quality Standards, Anna Nagurney and Dong Li, has now been accepted for publication in Computational Management. Science. The paper emphasizes the importance of uniform quality standards and is inspired, in part, by failures in the pharma industry, as well as other products, too long of a list to note all of them. I am obsessed by quality - from the air that we breathe, to the food that we eat, the water that we drink, and the products that our families use. If only producers know the quality of their goods and not consumers, we all lose!

In addition, we have co-authored a paper that focuses on information asymmetry in time and utilizes gane theory to evaluate supply chain network competition in both product flows and the average time of product deliveries.  The paper is Supply Chain Network Competition in Time-Sensitive Markets, Anna Nagurney, Min Yu, Jonas Floden, and Ladimer S. Nagurney. We will be presenting this paper at two different conferences in Europe in June.

Finally, environmental sustainability is a theme that we have long been very passionate about and have written alot on (including books on sustainable transportation and environmental networks). Making environmental impact information available to consumers can greatly influence their purchasing decisions and the environment.  Given that I spend a lot of time in Sweden where environmental sustainability is almost a "given," our paper, Fashion Supply Chain Network Competition with Ecolabelling,  Anna Nagurney, Min Yu, and Jonas Floden, quantifies the gains from ecolabelling. In our model, consumers are provided with the information associated the GHG emissions or the equivalent in the supply chain of the products.

Thanks to Bloomberg and Schapiro for their terrific OpEd and, remember, it was the Nobel laureate Robert Akerlof, whose inspiring paper on quality information asymmetry and 'lemons,' which was rejected by different journals 3 times, helped to enlighten us as to the value of information as well as quality!

Monday, May 26, 2014

Revising, Reviewing, and Rewarding - The Three R's of Scholarship

I am sitting in my office at the School of Business, Economics and Law at the University of Gothenburg, Sweden, where I am spending several weeks as a Visiting Professor of Operations Management.

The weather has been glorious since I arrived 10 days ago and I am enjoying the view and the lovely air blowing through my open window.

Academics never lose a beat and although they may trounce around from conference to conference, from one speaking venue to another, they always need to stay focused on the research at hand.

As children, we had emphasized to us, in the educational system, the 3R's: Reading, 'Riting, and 'Rithmetic, which are still fundamental to those of us who work, publish, and teach Operations Research, Management Science, and Operations Management, and, of course, in many other disciplines!

But, as scholars, we also devote a lot of time to such pursuits (which the public may not be as aware of) as revising and refereeing. The latter does not have to do with sports, but, rather, with reviewing articles that are submitted for publication. In our field, this is done pro bono, as a service activity. And the more productive one is, the more requests one gets to review papers that are submitted to journals. The same holds if one has multiple Associate Editor appointments, as I have.

This weekend, I spent a lot of hours reviewing a paper submitted to a transportation journal. It takes time to thoroughly read a paper, check for correctness (or not), make constructive comments and suggestions, and reach a decision (which will be collated by the editor with the other reports) as to whether the paper merits a revision (major or minor), should be accepted as is (I've actually had a few of the papers that I have authored get this mark of distinction), or should be outrightly rejected. And if a paper is rejected you may still wish to revise and resubmit it to another journal.

Solid refereeing is essential to the  scientific quality of papers that are published and in moving disciplines forward.

I have also been working on revising a paper with 3 co-authors who are now (yes, certain faculty members  travel alot) in different countries. Sometimes, this is an advantage, because a co-author can always be working. We have prepared the revision and response to the 3 reviewers, and are now carefully proofing the paper.

One should always reward oneself for hard work and, here, in Sweden, it is easy to do.  Below are some treats (a few, I admit, I have sampled) that are so beautiful I had to post the photos.

Of course, such rewards come also with a lot of walking and Gothenburg is such a walkable city with many pedestrian walkways shaded by lovely tree canopies at this time of year.

So love the work that you do - revise and resubmit those papers that you have dilligently labored over, enjoy the reviewing process, and don't forget to reward yourselves and your co-authors!

As the wonderful Administrative Assistant here, Wivvian, said to me the other day - Anna, you are working hard but you clearly love what you do - indeed!

And, in addition to gustatory treats, this afternoon I will be at an Urban Freight workshop, an intellectual treat, hosted by Chalmers University and the University of Gothenburg, which, conveniently for me, will take place at the business school here.

Saturday, May 24, 2014

Sustainability of Cities in Sweden with Gothenburg as an Example

Serendipitously, one of my best friends, Engineering Professor Kei May Lau, who used to be at UMass Amherst, and for the past decade has been a Professor at HKUST in Hong Kong, happened to be in Gothenburg, Sweden this past week. She was invited to speak at Chalmers University.

Since I am now back in Gothenburg as a Visiting Professor for several weeks this summer the timing was perfect - thank you Chalmers!

Kei May marveled at the greenery of this city, which is the second largest in Sweden.

In this beautiful city, there are different modes of transport to choose from and congestion pricing is really working!
In this lovely city, the canals were built by the Dutch. We visited the Gothenburg City Museum today, where I took the photo below of the aerial view of the city. The Gothenburg City museum recently was picked to be the best museum in Sweden.
I especially appreciate the walkability of this city, the safety, the architectural bbeauty and the proliferation of green spaces and parks.
And since sustainability is a theme of my research, I can't help but be inspired here and I thank the School of Business, Economics and Law at the University of Gothenburg for my appointment as a Visiting Professorship of Operations Management!

Coincidentally, the new mayor of NYC, Bill de Blasio, was in Sweden last week and visited Stockholm (I was still in Sicily then) to learn about what Sweden does to maintain such a great record of traffic safety, as reported by The New York Times.

Friday, May 23, 2014

Terrific Energy, Cities, and Complex Systems Workshop in Magical Erice, Sicily

Last week I was in beautiful Erice, Sicily, where I had been once before, back in 2006, also for a workshop.

This time, I was an invited speaker at the Workshop on Energy, Cities, and Control of Complex Systems organized by Drs. Adilson Motter and Robert Schock.  Dr. Motter is a Professor at Northwestern University and Dr. Schock is a Senior Fellow on Global Security Research at Lawrence Livermore Lab in Berkeley.  Dr. Schock, this past week, received an honorary degree from his undergrad alma mater, Colorado College, so congratulations are in order! In the photo above I am standing with Dr. Schock who has a PhD from RPI.

The venue for the workshop was the Ettore Majorana Scientific Center, which was originally 4 monasteries with the bells pealing regularly to remind us of that point.

The workshop convened physicists, engineers, transportation researchers, network scientists, a computer scientist (from IBM), as well as energy researchers, an atmospheric scientist, a statistician, several policy makers (including one from Toronto, Canada), and an operations researcher and network economist (me).

This was a multidisciplinary workshop with talks ranging from those with not a single equation to those with many beautiful equations. Quite a few of the talks were on network themes, which I appreciated very much as well as the emphasis on nonlinear dynamics.

My presentation was on Sustainable Supply Chains for Sustainable Cities.

The workshop took place in a room with not great acoustics but with frescoes on the walls.

The meals were provided and the food was delicious - with fish caught that morning and with cannolis that we consumed and did not get heart attacks from. Perhaps it was all the oranges that we ate.

We were picked up at the Palermo airport and bussed through the beautiful hills of Sicily covered with poppies and other flowers to historic Erice.

Now I am back in Gothenburg, Sweden, where, interestingly, it is very warm, whereas it was quite cool in Sicily!

Saturday, May 17, 2014

Photos from 25th Annual POMS Conference in Atlanta

While I was speaking at a workshop in historical Erice, Sicily, two of my present doctoral students (Sara Saberi and Dong "Michelle" Li) and three of my former ones (Dr. Min Yu, Dr. Amir H. Masoumi, and Dr. Patrick Qiang) , who are now Professors at different colleges and universities, and are Associates of the Supernetwork Center at the Isenberg School that I direct, were speaking at the 25th Annual POMS Conference, which took place last week in Atlanta, Georgia. The majority of our presentations were on various aspects of supply chains from food supply chains and perishability to disaster relief supply chains to supply chain quality competition under information asymmetry.

My doctoral student Dong "Michelle" Li also took part in the doctoral consortium there and very much enjoyed hearing such Operations Management superstars as Professor John Birge and Professor Ann Marucheck share their wisdom with the students.

Michelle took the photos below, which I am disseminating, since colleagues and students always enjoy photos!

We have posted several of  the presentations that the supernetwork team members gave at the POMS conference on the Supernetwork Center website. I have also posted the presentation that I delivered on Sustainable Supply Chains for Sustainable Cities at the Erice Workshop.

Friday, May 16, 2014

Transportation Research Board of the National Academy of Sciences Honors Memory of Operations Research Female Superstar

I received the news when I was at the Cities, Energy, and Complex Systems Workshop in Erice, Sicily, which took place May 11-14, 2014.

Yesterday, I traveled back from Erice to Palermo to Munich and, finally, to Gothenburg, Sweden where I am a Visiting Professor.

Professor David E. Boyce sent me a message that the Transportation Network Modeling Committee of the Transportation Research Board of the National Academy of Sciences has introduced a best paper award in honor of my doctoral dissertation advisor at Brown University, Professor Stella Dafermos. Stella was the second female to receive a PhD in Operations Research in the world and died at the age of 49.

More information on this award is available here:

Professor Boyce told me that much of the credit to making this happen belings to Professor Elise Miller-Hooks and I thank all those who made this important recognition of Stella's great contributions happen.

Stella passed away almost 25 years ago and made lasting contributions to the modeling of network equilibria in transportation science, operations research, and economics. When she passed away I was asked to write an obituary in her honor which was published in our journal Operations Research.

Interestingly, while in Erice, at one of the delicious dinners, I sat next to Dr. Aristides Patrinos, who is Greek, and who is heading NYU's Center on for Urban Science + Progress. We ended up talking aout the Dafermos family since he has served on scientific funding panels with Professor Constantine Dafermos, Stella's husband.

Dr. Patrinos is the only person that I have ever met whose face graces a postage stamp and he surprised me with a few stamps with his image.

Sunday, May 11, 2014

Such a Proud Academic Mom

Happy Mother's Day to everyone!

I am en route from Amsterdam to Italy today - very excited about the workshop on Energy, Cities, and Complex Systems, which I will be speaking at in Erice, Sicily.

I heard the great news since writing my recent blogpost.

It is now official - what a great Mother's Day present!

Two of my former doctoral students, both of whom received their PhDs in Management Science at the Isenberg School, have now been promoted to Associate Professor with tenure at their respective universities.

Congratulations to Dr. Trisha Woolley Anderson, who received her PhD in 2010 and to Dr. Zugang "Leo" Liu, who received his in 2008!  Dr. Anderson is at the School of Business at Texas Wesleyan University and Dr. Liu is at Penn State U. Hazleton. Dr. Liu also is the recipient of the Faculty Research Award at his university this year and Dr. Anderson received her university's Teaching Award, also in 2014.

Also, I am so proud of all our Operations & Information Management majors at the Isenberg School who received their degrees this past weekend - Congratulations!!!!

Thursday, May 8, 2014

A Super Year for the Supernetwork Team

The academic year is drawing to a close with exams over with, grading completed and grades submitted,  and graduations upon us!

It is a time of year with many transitions and a great time to take stock.

Soon many of us will be off to conferences and, during the summer, will be immersed in various activities, which, of course, will include research and, for some of us, the supervision of doctoral students.

As the Founding Director of the Supernetwork Center at the Isenberg School of Management, I have been extra busy this past week. Center Directors have met with UMass Facilities Planning folks regarding space needs since we will be having a grand new addition to the Isenberg School!

Hence, there are many exciting and wonderful things happening.

This is a post to celebrate some of the great achievements this year of the Supernetwork Center Associates, who include not only students but also faculty from 3 different continents and several industrialists.

  • Center Associate Dr. Jose Cruz of the School of Business at UCONN was selected an Ackerman Scholar for 2014-2016.  The Ackerman Scholar Award recognizes significant and continuing all around academic productivity among the faculty of the School. It is awarded to faculty who are not already supported by Chair or Professorship appointments. This is his second appointment as an Ackerman Scholar, having held this appointment also from 2012-2014. 
  • Center Associate Dr. Trisha Anderson of the School of Business at Texas Wesleyan University, received the coveted "Exemplary Teacher Award" from her university.  The award is given to a Texas Wesleyan faculty member who displays quality in the areas of teaching, scholarship, community and University service and personal integrity.  Both Jose and Trisha received their PhDs in Management Science from UMass Amherst and I was their doctoral dissertation supervisor.  Jose has 5 degrees from UMass Amherst - a record!
  • Doctoral Student Center Associate  Dong "Michelle" Li is one of three Isenberg School of Management doctoral students awarded the 2014 Outstanding Doctoral Student Researcher Award. Given that the Isenberg School has 7 departments, this is quite the accomplishment.
  • Doctoral Student Center Associate Sara Saberi is one of ten recipients of the prestigious 2014 Isenberg Scholar Award at UMass Amherst and one of only three such recipients from the Isenberg School.
  •  The UMass Amherst INFORMS Student Chapter, whose President this year is Doctoral Student Center Associate Shivani Shukla, received the Magna Cum Laude Award for its activities. This is the 8th national award from INFORMS in as many years. I have been the chapter's Faculty Advisor for a decade.
  • Center Associate Dr. Amir H. Masoumi of the School of Business at Manhattan College received the 2013 Judith B. Liebman Award of INFORMS for his work with the UMass Amherst INFORMS Student Chapter while he was a doctoral student at the Isenberg School.
  • Plus, this year was extra special to me because I was elected an INFORMS Fellow last October in the class of 2013.
We expect to hear, shortly,  more very good news on the promotion & tenure cases of two Center Associates. We are just waiting for the final approval from the  Board of  Trustees of their universities.

Also, I would be remiss not to mention and recognize one of our Undergraduate Center Associate Alums, Christina Calvaneso, who worked at the Supernetwork Center,  and is a UMass Amherst alum, class of 2003. Christina, who is the Senior of VP and Business Operations at Eyeview, will be recognized on Jun 18, 2014 by the Isenberg School of Management with the 2014 Young Alum Business Leadership Award!  I nominated her for this award and had over a decade ago nominated her for the 21st Century Leaders Award, which she received from UMass Amherst.

I always say that you can accomplish so much more through collaboration and mutual support, and, besides, it is much more fun to work together!

Since supernetworks are "networks of networks" we certainly practice what we research and preach!

For more news on the Supernetwork Center and its Associates do check out our newsletters, going even back to 2004!

Tuesday, May 6, 2014

Toward An Economy Plane for the Internet - A Paradigm Shift Through Our NSF Research

Yesterday we heard the good news that our paper:
had been accepted by the Editor of Computer Communication Review (CCR) for publication. We expect it to appear in the July 2014 issue.

CCR, according to its website, is the magazine of ACM SIGCOMM. ACM, as some of you may know, is the acronym for the Association for Computing Machiner, the world's largest educational and scientific computing society. SIGCOMM is the special interest group on Data Communication.

The scope of CCR is that:  Technical papers accepted to CCR typically report on practical advances or the practical applications of theoretical advances. CCR serves as a forum for interesting and novel ideas at an early stage in their development. The focus is on timely dissemination of new ideas that may help trigger additional investigations. While the innovation and timeliness are the major criteria for its acceptance, technical robustness and readability will also be considered in the review process. We particularly encourage papers with early evaluation or feasibility studies. 

Our paper reports on our vision for our National Science Foundation (NSF)  project: Network Innovation Through Choice, which, as you can see from the names on our paper, is multiuniversity and multidisciplinary (and also multiyear). I truly enjoy working with this great team of computer scientists and electrical and computer engineers and provide the network economics and operations research and management science perspective. 

In particular, we are envisioning and working on a Future Internet Architecture (FIA) and are, in fact, one of five such teams in the U.S. selected by NSF.   Our FIA is called ChoiceNet.

In this paper, in the Abstract, we state that: "The Internet has been a key enabling technology for many new distributed applications and services. However, the deployment of new protocols and services in the Internet infrastructure itself has been sluggish, especially where economic incentives for network providers are unclear.  In our work, we seek to develop an “economy plane” for the Internet that enables network providers to offer new network- based services (QoS, storage, etc.) for sale to customers. The explicit connection between economic relationships and network services across various time scales enables users to select among service alternatives. The resulting competition among network service providers will lead to overall better technological solutions and more competitive prices. In this paper, we present the architectural aspects of our ChoiceNet economy plane as well as some of the technological problems that need to be addressed in a practical deployment."

Also, we are delighted that our earlier paper,A Network Economic Game Theory Model of a Service-Oriented Internet with Choices and Quality Competition, Anna Nagurney, Dong Li, Tilman Wolf, and Sara Saberi, Netnomics 14(1-2): (2013) pp 1-25, which is also based on this NSF funded project was selected by ACM Computing Reviews in its list of Best of 2013.   The list recognizes notable items published in computing.

Our paper was selected in the Computer Applications category and the full list can be downloaded here.   Both Sara Saberi and Dong Li are my doctoral students in Management Science at the Isenberg School at UMass Amherst.

It is terrific to see interdisciplinary research making advances in what may actually be a paradigm shift!

Sunday, May 4, 2014

Bravo to Our Outstanding Doctoral Students at the Isenberg School of Management

Doctoral students are essential to a major research university.

Doctoral students, with some guidance from their dissertation advisors, push the frontiers of our disciplines in new directions through serious, intense, creative study and research that is captured and synthesized in their doctoral dissertations.

Successful ones receive their PhDs and become colleagues even though they may have new jobs continents away. Many become educators while others join industry, research labs, start companies, and contribute in other ways.

The intensity of the doctoral student life is well-known and sometimes even caricatured through such classic means as PhD Comics. 

On May 1, at the Isenberg School of Management,  several of our outstanding doctoral students were recognized and two out of the four are doctoral students in Management Science. They received their award certificates with a monetary award, as well, at a lunch party, complete with pizza!

Our PhD Director, Professor of Marketing Dr. George Milne, gave out the awards and, in an earlier message to our school, he had shared the names of  the winners of this year’s Doctoral Student Outstanding Performance Awards and what a great group it is this year!
The Outstanding Doctoral Student Researcher Award goes to three students this year: Heng Chen, Rory Eckhardt, and Dong “Michelle” Li. Both Heng and Michelle are doctoral students in Management Science and Michelle is my doctoral student..She recently successfully defended her doctoral dissertation proposal. According to Dr. Milne, and I fully agree: This year has been a productive research year among doctoral students, and the research bar has been raised by the outstanding performance of these three scholars.

Heng Chen is a third year student who has a paper accepted (along with his advisor Professor Senay Solak) in Production and Operation Management.   Rory Eckhardt is a fourth-year student in Strategic Management, who has published articles in the Journal of Management and a Journal of Management Studies.  The JOM was a coauthored with doctoral student Ali Crocker.  His JMS was coauthored with Professor Bruce Skaggs.   Dong “Michelle” Li is a fourth year student  who has published four journal articles in the International Transactions in Operational Research, Netnomics, Computational Economics, and has a paper accepted in the journal Computational Management Science. I share co-authorship with Michelle and she is always willing to help out other students working with us at the Supernetwork Center.

The Outstanding Doctoral Student Teacher Award goes to Ryan Spalding.  Ryan is a fourth-year student in Sport Management (graduating this week).   He has been recognized by students, other doctoral students, and faculty as a gifted teacher. 

Also, on May 1, Michelle and Heng  took part in our great UMass Amherst INFORMS Student Chapter end of the semester dinner party, and helped tremendously with the logistics. Ryan joined  us to celebrate and engaged in conversation and delicious international cuisines

Building community is essential to the success of the doctoral program and it is worth the effort!

Michelle is my third PhD student in Management Science to receive this award in the past 5-6 years. Great to see our area's research so recognized!

Most importantly, you must love what you do and that goes also for the research that you do!

Saturday, May 3, 2014

Finance Superstars that are Changing Our World - CISDM Research Day at the Isenberg School Rocks!

Yesterday, at the Isenberg School of Management, we were treated to brilliant talks and discussions at the Center for International Securities and Derivative Markets (CISDM) Research Day!

The event from 11:30AM until 4:30PM was organized by my great Finance colleague, Dr. Mila Sherman.

Two of the talks: "Can Financial Engineering Cure Cancer? A New Approach to Funding Biomedical Innovation" and "Lies my Finance Professor Told Me: Reconciling Efficient Markets and Behavioral Finance via Evolutionary Biology and the Cognitive Neurosciences" were given by the Finance Superstar, Dr. Andrew Lo, of the MIT Sloan School.

Our Isenberg Dean, Dr. Mark Fuller, Associate Dean Dr. Jane Miller,  and the UMass Amherst VCRE, Dr. Mike Malone, all joined us for Dr. Lo's first presentation. It was great to have faculty come from Babson, Suffolk University, and Smith College to this event, as well as several alums, practitioners, and also students. Several of our PhD students in Management Science also came, which was great.

I have heard Professor Lo speak on several occasions because we had hosted him before and I have spoken at various venues with him  in both NYC and Chicago. Mila and I were in the Network Analysis segment of the latter conference which was on Measuring Systemic Risk.

He is brilliant and in his financial engineering and curing cancer presentation (on which I took copious notes) he noted that if we could create a fund of $30 billion we should be on our way to curing cancer - the strategy should be, as in finance, to diversify the portfolio and enable the investigation of multiple pathways with 150 cancer compounds, for example. NIH cannot support all the cancer researchers out there!

Who has not been affected by cancer, whether individually or through having a relative or friend suffering from the disease. Andrew noted that his mother died of cancer and my dissertation advisor at Brown University, Dr. Stella Dafermos, also died of cancer at age 49 back in 1990. She was a genius. We know so much now how cancer and other diseases work at the molecular level and have had amazing drug discoveries such as Gleevec and Avastin but the right investments and financial support are needed. He noted that no new Alzheimer's drugs have been introduced in the past decade!

The business model of pharma is broken and the economic risk has increased. Private equity is not ideal for the financing of drug discoveries. We need to get the funds into the system to finance drug development and use financial engineering and securitization.

He also spoke about orphan (rare) diseases and associated drugs and innovations and that business models for those work - pricing of certain drugs, however, is another issue.

Dr. Lo emphasized: Doing Well with Doing Good . All the Operations Research folks out there will recall one of our profession's themes of Doing Good with Good O.R. (Operations Research).

My research group at the Supernetworks Center at the Isenberg School has written several papers on the pharmaceutical industry with a focus on competitive supply chains. Hence, his first talk was especially  thrilling and intellectually captivating. Our paper: Pharmaceutical Supply Chain Networks with Outsourcing Under Price and Quality Competition, Anna Nagurney, Dong Li, and Ladimer S. Nagurney, International Transactions in Operational Research 20(6): (2013) pp 859-888, focuses on quality issues.  Our paper, A Supply Chain Generalized Network Oligopoly Model for Pharmaceuticals Under Brand Differentiation and Perishability, Amir H. Masoumi, Min Yu, and Anna Nagurney, Transportation Research E 48: (2012) pp 762-780, investigates even the impact of the loss of patent rights and competition from generics.

In his second talk, Dr. Lo  emphasized how insights from evolutionary biology and neurosciences can reveal human decision-making behavior and what it means for financial decision-making as well. I loved the interdisciplinarity of his talks - bringing biological insights to economics and finance. He is a true Renaissance man and incredibly  inspiring. He noted that rationality is the delicate balance between emotion and logic and stated that wisdom of crowds works, unlike the madness of mobs!

I very much appreciated his adaptive market hypothesis and how this concept differs from the efficient market hypothesis. Lo also recognized the 3 recent recipients of the Nobel Prize in Economic Sciences - Drs. Fama, Shiller, and Hansen, and how the media emphasizes the disparities and different perspectives associated with them.

The other two talks were given by my wonderful Finance colleagues, Dr. Bing Liang, who spoke on "Hedge Fund Ownership and Stock Market Efficiency" and Dr. Hossein Kazemi, who gave the last presentation of the day on "Dynamics of Hedge Fund Exposures: Implications for Performance and Herding."
Thanks to my colleagues and to Dr. Andrew Lo for such a fabulous intellectual feast that we all experienced at the CISDM Research Day!

Friday, May 2, 2014

A Collaboration of 3 Academic Generations on E-Cycling + Sustainable Supply Chains

We recently received some great news.

Our paper, "When and for Whom Would E-Waste be a Treasure Trove? Insights from a Network Equilibrium Model of E-Waste Flows," was accepted by the Editor of the International Journal of Production Economics (IJPE) for publication.

This paper was co-authored by Professor Tina Wakolbinger of the Vienna University of Economics and Business in Austria, Professor Fuminori Toyasaki of York University in Canada, Thomas Nowak, a doctoral student being supervised by Professor Wakolbinger, and me.

Both Tina and Fuminori were my former doctoral students in Management Science at the Isenberg School of Management and worked in my Supernetwork Laboratory so this collaboration across three countries and three academic generations is extra special. Fuminori and I had earlier written the paper, "Reverse Supply Chain Management and Electronic Waste Recycling: A Multitiered Network Equilibrium Framework for E-Cycling,"  which was published in Transportation Research E in 2005, and it continues to be one of my most highly cited papers according to Google Scholar.

The abstract of our IJPE  paper is reprinted below.

E-waste is the fastest growing waste stream. Due to its potential economic value as well as its possible negative impacts on the environment, tracing e-waste  flow is a major concern for stakeholders of e-waste management. Especially, whether or not adequate amounts of electrical and electronic equipment waste (WEEE)  flow into the designed recycling systems is a fundamental
issue for sustainable operations. In this paper, we analyze how technical, market, and legislative factors influence the total amount of e-waste that is collected, recycled, exported and (legally and illegally) disposed of. We formulate the e-waste network  flow model as a variational inequality problem.

The results of the numerical examples highlight the importance of considering the interaction between the supply and the demand side for precious materials in policy-decisions. Low collection rates of e-waste lead to low profi ts for stakeholders and they make it difficult to establish sustainable recycling operations. Increasing WEEE collection rates increases recyclers profits; however, it only increases smelters' profits up to a certain limit. After this limit smelters cannot benefit further due to limited demand for precious materials. Furthermore, the results emphasize the importance of establishing international control regimes for WEEE  flows and they show possible negative consequences of the recent trend of dematerialization. More precisely, product dematerialization tends to decrease recyclers' and smelters' profits as well as increase out flow of e-waste from the designated recycling system.

Isn't it great to have research on sustainable supply chains capture the imagination of several academic generations?!

The photo above, taken in a cafe in Vienna, Austria,  is of Thomas Nowak, Professor Toyasaki Professor Wakolbinger, and two other former doctoral students of mine, Professor Dmytro Matsypura of the University of Sydney in Australia, and Professor Jose Cruz of the University of Connecticut.

Mother's Day is just around the corner and I am a very proud Academic MOM!

Thursday, May 1, 2014

GREAT UMass INFORMS Student Chapter Party with Surprise Attendance by Isenberg Alums

Today we had our end of the semester (academic year, actually) UMass Amherst INFORMS Student Chapter party. It was held in the Isenberg School of Management.

As many said who came (and the attendance was fabulous with faculty from the Isenberg School, the College of Engineering, some staff members, several administrators, and both graduate and several undergraduate students coming),  this party has become a tradition and not to be missed!

It was extra special for me because two of my former students came, with Jan Sudra driving up from United Technologies in Hartford and Bill Bebrin from the Boston area. Both were Operations Management majors and I had to hug them. The former one even brought pierogies that he had made! What a wonderful surprise it was to see them.

Seeing former students who are doing so well, makes me so happy and so proud!

The UMass Amherst INFORMS Student Chapter officers and members outdid themselves and being experts in operations research, management science, and, of course, logistics, the food arrived in a timely manner with the hot food hot and the cold food cold.

The food was delicious with a predominance of European and Asian cuisines. And, as is my tradition, I also brought pierogies (two types) and kielbasy.

The desserts came from several local stores with the chocolate and mousse cakes coming from Whole Foods.
 Best of all was seeing so many very wonderful people who make our academic community so special.

A special shoutout to our PhD Director, Dr. George Milne, and to our former Dean, Dr. Tom O'Brien, for coming! The students very much appreciate when administrators support them and so do I!
Thanks to Bill Bebrin for taking the group photo above - wish we had captured everyone but it was getting late.

Thanks also to this year's Chapter Officers for their extraordinary work! It is a pleasure to work with them as their Faculty Advisor.