ZLC Speakers Series: Ushio Sumita & Jun Yoshii

Topics:

(1) Application of Collateralized Debt Obligation Approach for Managing Inventory Risk in Classical Newsboy Problem (Ushio Sumita)
In the midst of the ongoing world financial crisis, the Collateralized Debt Obligation (CDO) became notorious. However, the fact that the misuse of the CDO resulted in collapse of the world economy does not necessarily imply that the CDO itself would be hazardous. The purpose of this paper is to explore the potential of the CDO approach for controlling general risks, by applying it to the classical Newsboy Problem (NBP). The underlying opportunity loss of NBP replaces the credit risk of CDO. For VaR (Value at Risk) problems formulated without or with CDO, extensive numerical experiments reveal that the overall effect of CDO is rather limited. It could be effective, however, if (i) the underlying risk is high in that the variability of the stochastic demand D is substantially large; (ii) the expected profit should be held above a high level; (iii) the probability of having a huge loss should be contained; and (iv) the detachment point Kd should be held relatively low. (Joint work with Rina Isogai and Satoshi Ohashi).

(2) Analysis of e-Word-of-Mouth Information for Digital Cameras in Japan (Jun Yoshii)
The purpose of this paper is to analyze the perception gap between the product intents and the consumer appreciations concerning a set of digital cameras produced by Japanese manufacturers. By collecting and analyzing actual reviews as well as the product descriptions written by the manufacturers from one of the most influential social networks in the area in Japan, the keywords of frequent use are extracted through text-mining techniques. A dictionary is then prepared, where keywords of similar meaning are grouped into a keyword group. Based on these keyword groups, the several indices are introduced to analyze the perception gap between the manufactures and the consumers, demonstrating the potential importance of e-WOM analysis in e-marketing. (Joint work with Ushio Sumita).