Neighborhood search heuristics for selecting hierarchically well‐formulated subsets in polynomial regression

The importance of subset selection in multiple regression has been recognized for more than 40 years and, not surprisingly, a variety of exact and heuristic procedures have been proposed for choosing subsets of variables. In the case of polynomial regression, the subset selection problem is complicated by two issues: (1) the substantial growth in the number of candidate predictors, and (2) the desire to obtain hierarchically well‐formulated subsets that facilitate proper interpretation of the regression parameter estimates. The first of these issues creates the need for heuristic methods that can provide solutions in reasonable computation time; whereas the second requires innovative neighborhood search approaches that accommodate the hierarchical constraints. We developed tabu search and variable neighborhood search heuristics for subset selection in polynomial regression. These heuristics are applied to a classic data set from the literature and, subsequently, evaluated in a simulation study using synthetic data sets. © 2009 Wiley Periodicals, Inc. Naval Research Logistics, 2010     

Coercive diplomacy and the Donbas: Explaining Russian strategy in Eastern Ukraine

What were Russia’s objectives in Eastern Ukraine, and why was it seemingly unable to achieve a successful or decisive outcome? In contrast to Russia’s seizure of Crimea, the uprising in Eastern Ukraine was marked by disorganization and chaos. Using proxy and surrogate actors, along with military exercises and the injection of Russian troops, Russia sought to institutionalize a political entity inside Ukraine to influence its domestic politics. In this article, I analyze the mechanisms by which Russia attempted to implement, and later salvage, its strategy. The article contributes to clearer theoretical and practical understanding of limited force in coercive diplomacy, signaling, and a more rigorous treatment of the role and uses of proxy actors.     

Slow failure: Understanding America’s quagmire in Afghanistan

ABSTRACT

The United States government has no organised way of thinking about war termination other than seeking decisive military victory. This implicit assumption is inducing three major errors. First, the United States tends to select military-centric strategies that have low probabilities of success. Second, the United States is slow to modify losing or ineffective strategies due to cognitive obstacles, internal frictions, and patron-client challenges with the host nation government. Finally, as the U.S. government tires of the war and elects to withdraw, bargaining asymmetries prevent successful transitions (building the host nation to win on its own) or negotiations.     

Warranty claims modeling

A company wishes to estimate or predict its financial exposure in a reporting period of length T (typically one quarter) because of warranty claims. We propose a fairly general random measure model which allows computation of the Laplace transform of the total claim made against the company in the reporting interval due to warranty claims. When specialized to a Poisson process of both sales and warranty claims, statistical estimation of relevant quantities is possible. The methodology is illustrated by analyzing automobile sales and warranty claims data from a large car manufacturer for a single car model and model year. © 2008 Wiley Periodicals, Inc. Naval Research Logistics, 2008     

New inequalities for finite and infinite group problems from approximate lifting

In this paper, we derive new families of facet‐defining inequalities for the finite group problem and extreme inequalities for the infinite group problem using approximate lifting. The new valid inequalities for the finite group problem include two‐ and three‐slope facet‐defining inequalities as well as the first family of four‐slope facet‐defining inequalities. The new valid inequalities for the infinite group problem include families of two‐ and three‐slope extreme inequalities. These new inequalities not only illustrate the diversity of strong inequalities for the finite and infinite group problems, but also provide a large variety of new cutting planes for solving integer and mixed‐integer programming problems. © 2008 Wiley Periodicals, Inc. Naval Research Logistics, 2008     

Technical note: Finite-time regret analysis of Kiefer-Wolfowitz stochastic approximation algorithm and nonparametric multi-product dynamic pricing with unknown demand

We consider the problem of nonparametric multi-product dynamic pricing with unknown demand and show that the problem may be formulated as an online model-free stochastic program, which can be solved by the classical Kiefer-Wolfowitz stochastic approximation (KWSA) algorithm. We prove that the expected cumulative regret of the KWSA algorithm is bounded above by where κ₁, κ₂ are positive constants and T is the number of periods for any T = 1, 2, … . Therefore, the regret of the KWSA algorithm grows in the order of , which achieves the lower bounds known for parametric dynamic pricing problems and shows that the nonparametric problems are not necessarily more difficult to solve than the parametric ones. Numerical experiments further demonstrate the effectiveness and efficiency of our proposed KW pricing policy by comparing with some pricing policies in the literature.     

Growth recovery after civil conflict: a fractional integration approach

Using recent econometric techniques based on fractional integration, we find that developing countries recover their economic growth faster than developed countries in response to a shock. Following this methodology, we find that longer civil conflicts are associated with a faster recovery process. We further investigate this issue by exploring correlations with components of GDP, military spending, institutions and aid and find heterogeneous effects of these channels by duration of conflict. Higher government spending is correlated with faster recoveries post longer conflicts, and higher consumption spending is linked to faster recoveries following shorter conflicts. Military spending appears to be driving the government expenditure that makes countries recover from longer conflicts. More democratic institutions are associated with faster recoveries post short wars but slower recoveries following long wars.     

An adaptive dynamic programming algorithm for a stochastic multiproduct batch dispatch problem

We address the problem of dispatching a vehicle with different product classes. There is a common dispatch cost, but holding costs that vary by product class. The problem exhibits multidimensional state, outcome and action spaces, and as a result is computationally intractable using either discrete dynamic programming methods, or even as a deterministic integer program. We prove a key structural property for the decision function, and exploit this property in the development of continuous value function approximations that form the basis of an approximate dispatch rule. Comparisons on single product‐class problems, where optimal solutions are available, demonstrate solutions that are within a few percent of optimal. The algorithm is then applied to a problem with 100 product classes, and comparisons against a carefully tuned myopic heuristic demonstrate significant improvements. © 2003 Wiley Periodicals, Inc. Naval Research Logistics 50: 742–769, 2003.     

A model for step‐stress accelerated life testing

Modern technology is producing high reliability products. Life testing for such products under normal use condition takes a lot of time to obtain a reasonable number of failures. In this situation a step‐stress procedure is preferred for accelerated life testing. In this paper we assume a Weibull and Lognormal model whose scale parameter depends upon the present level as well as the age at the entry in the present stress level. On the basis of that we propose a parametric model to the life distribution for step‐stress testing and suggest a suitable design to estimate the parameters involved in the model. A simulation study has been done by the proposed model based on maximum likelihood estimation. © 2003 Wiley Periodicals, Inc. Naval Research Logistics, 2003     

Optimal retail assortments for substitutable items purchased in sets

We consider the problem of optimizing assortments in a multi‐item retail inventory system. In addition to the usual holding and stockout costs, there is a fixed cost for including any item in the assortment. Customers' preferences for items include both probabilistic substitution patterns and the desire to purchase sets of complementary items. We develop a demand model to capture this behavior, and derive tractable approximations that allow us to formulate the optimization problem as a 0–1 mixed integer linear program. Numerical examples are solved to illustrate key insights into how both complementary and substitute items affect the optimal assortment and the expected profit. © 2003 Wiley Periodicals, Inc. Naval Research Logistics 50: 793–822, 2003.