Crisis Risk Research Articles

Crisis consultations as a component of political management

It is determined that crisis consultations represent a set of measures aimed at stabilizing the situation of a particular subject, solving a set of problems associated with the maximum increase in the efficiency of the activity. The following types of crisis consultations are singled out: direct consultations of managers; implementation of advisory activities (consultations on emerging problems, diagnosis of the organization, definition of a crisis strategy, development of a plan of measures for crisis prevention, risk assessment and follow-up of its implementation, support of the organization during the implementation of the plan for crisis prevention, development of preventive measures in relation to avoidance of crisis phenomena); crisis reflexive games (training of managers and staff); case study review; use of benchmarking methods. The role of crisis analysis in conducting crisis consultations has been determined. It was emphasized that crisis analysis enables to prevent and plan possible crisis situations, ways of their neutralization and overcoming with minimal expenses for the organization. The role functions of crisis advisers are determined. The stages of crisis management (according to R. Heath) are revealed: prevention – prevention of crisis risks, analysis of losses for business; readiness – awareness of the probability of crises, staff training; salvation – drawing up plans, preventing consequences; recovery – recovery of effective production, assessment of the crisis. The types of crisis management are distinguished: preventive, aimed at analyzing the indicators of the crisis and identifying its causes and factors for timely prevention or minimization of possible crisis processes; an anticipatory, the essence of which is to develop goals and objectives for leadership in order to prevent crisis phenomena. A demarcation of crisis management and risk management has been conducted: if crisis management is primarily a process of responding to already existing serious threats to one or another organization or to events that have already occurred, risk management is associated with the process of identifying certain risks mainly for future activities organization, as well as the appropriate acceptance of these risks or their elimination.

Meeting the Challenges of International Crises: The Experience of the Iranian Blood Transfusion Organization.

ABSTRACTCrises require a timely and well-prepared response by health services, especially those that are directly engaged with the lives of the patients such as blood services. The Iranian Blood Transfusion Organization as a single national authority of blood transfusion has left many crises behind. In this study, we examined the main international crises that the blood transfusion organization has faced during its 44-year history and objectively evaluated the methods for crisis risk reduction, both administrative and operational, all of which have led to fundamental advances in the organization. By proper planning and effective strategy setting, the Iranian Blood Transfusion Organization has managed to cope with international threats and in some cases has turned threats into opportunities to implement new, permanent administrative and operational strategies. It is not prudent for blood transfusion centers to develop their disaster risk reduction strategies on an individual-country basis in a world where global risk and crisis factors are rapidly increasing. Reduction of risk for blood transfusion centers must become a strategic priority nationally and globally. (Disaster Med Public Health Preparedness. 2019;13:410-413).

Renal crisis risk with oral glucocorticoids for sclerosis

Renal crisis risk with oral glucocorticoids for sclerosis

Economic cycle, fertility, and seasonal pattern of suicide rates in South Korea from 1995 to 2015

The aim of this study is to investigate mixed risk factors associated with suicide rates in South Korea. Data on suicide in South Korea from 1995 to 2015 were investigated to understand risk factors for suicide using time series analysis. We found that increasing GDP per capita growth rates and fertility rates were associated with decreasing suicide rates. Using the moving average method (monthly data), we found a negative correlation between suicide rates and the Korea Composite Stock Price Index (KOSPI). Moreover, a seasonal pattern of suicide rates was found in South Korea. The suicide rate was highest in May and lowest in January. The months of outliers occurred against the seasonal pattern observed in 1998, 2003, 2005, 2007, and 2008. These might be associated with the economic crisis or other miscellaneous risk factors. These results provide evidence that there is a significant relationship between suicide rates and the socioeconomic factors mentioned above in South Korea. The results obtained in this study may help to create public policies for lowering suicide rates in South Korea.

PROBLEMS OF RISK COMMUNICATION ON RADIATION SAFETY. ANALYSIS OF MATERIALS ON THE INTERNET AFTER THE 2013 RADIATION ACCIDENT AT THE ELECTROSTAL HEAVY ENGINEERING WORKS

Presumably in the first days of April 2013, the smelting of scrap metal occurred on the territory of the Electrostal Heavy Engineering Works without the use of radiation input control. An unspecified source of ionizing radiation, containing 137Cs in an unknown quantity, was melted. As a result of smelting, contamination of the territory of the plant and the adjacent territory of Elektrostal city occurred. The relevance of the study is due to the high social significance of this accident, which is confirmed by a large number of materials published in both federal and regional mass media. In total, for the period from 12.04.2013 to 12.05.2013, 129 materials were identified. In addition, the total number of video views on this accident on the YOUTUBE website exceeds the population of Electrostal city. The purpose of the study was to analyze the practice of crisis risk communication, used by various officials and specialists in connection with the radiation accident in the territory of the Electrostal Heavy Engineering Works in 2013. The study analyzed publications in the mass media, messages on official websites of departments, organizations and authorities involved in the emergency response, video materials on the YOUTUBE website, messages on Internet forums. In order to record, analyze and store publications, an automated information system for the analysis of publications, developed by specialists of the Rospotrebnadzor Information and Analytical Center for Radiation Safety of the Population was used. The analysis of crisis risk communication with the population conducted by government bodies and representatives of various departments in the liquidation of the consequences of a radiation accident on the territory of the Electrostal Heavy Engineering Works revealed a discrepancy between the real risk communication practices in the case of the radiation accident in Elektrostal with modern scientific recommendations for radiation risk communication. Individual cases of unreliable and mutually exclusive information provided by the authorities to citizens were identified, resulting in a rather negative response on the part of Internet users. As a result of the research, there was revealed a lack of response to information materials distributed on the Internet, devoted to a radiation accident on the part of official authorities. Information from the authorities aimed at appeasing the public, due to the critical perception of the information received from the authorities, was not taken seriously by a significant part of the population. It was shown that in order to reduce the negative consequences of ineffective information work with the public, it is necessary to develop methodological support for crisis risk communication and to introduce it into the everyday practice of Rospotrebnadzor through training and improving the skills of individuals involved in communication with the media, non-governmental organizations and the population.

Evaluation of integrated management to reduce the crisis with approach to spatial data infrastructure

As management is one of the most important elements for all activities of the current world and as Iran is one of the most hazardous countries in terms of natural disasters, the issue of management gains special importance in crisis. The main purpose of crisis management is reducing crisis risk and the ways to achieve this goal are various and have been evolved over the time. Crisis management includes a disaster before the beginning to the end and the operations after the disaster. While occurrence of each accident, the Committee of Crisis and Disasters analyzes the situation from different dimensions using existing instructions and makes the best decision and provides it for the involved organs. Due to importance of time, the main part of the process of crisis management is taken before the disaster. Reducing the risk of crisis with the integration in its heart with spatial planning is required. In this regard, spatial data infrastructure (SDI) provides required conditions for collecting and maintaining spatial data to facilitate sharing the data and creating an integrated management. Therefore, the objective of this study is to evaluate spatial data infrastructure as a context for realization of integrated management to reduce risk of probable crises using descriptive-analytical method.Keywords: spatial data infrastructure, crisis risk reduction, integrated management

Making International Financial Integration Work for Low-Saving Countries

Deeper financial integration is expected to enable low-saving countries to increase domestic investment but also to increase crisis risks by facilitating the accumulation of risky foreign liabilities. This paper explores the connections between financial integration, investment and crisis risk to assess this tradeoff. It confirms expectations but also finds that the accumulation of safe foreign assets that financial integration brings is an important risk offset that in many cases even eliminates the risk factor from the tradeoff altogether. Furthermore, it shows that the risk features of assets and liabilities depend on their type. Ultimately, whether international financial integration is in fact a reliable remedy for individual countries critically depends on the portfolio composition of their foreign assets and liabilities.

Preventing and facing new crisis and risks in complex environments

Ubiquitous automation, massive digitalisation, virtualisation of services and extremely rapid development of technology, mobile and cloud applications in the globalisation context have introduced new crisis and new risks. The increasing computers power allow capturing and analysing the exponential amount of data and information produced by human activities, exchanged through machine to machine transactions, through IoT and captured on the web via various services. The results of traditional analytics help pushing sales but are not always relevant for decision making. Artificial Intelligence techniques have been used for years to discover knowledge from multimedia data, but without a systematic knowledge management this data is insufficient for right decision taking, especially in critical situations. After presenting some main crisis and risks this paper focus on decision making process based on exploration of available knowledge. Two examples of decision making in industrial design and in energy field are given and discussed. They are followed by conclusions and perspectives for future extensions.

Integrating nowcasting with crisis management and risk prevention in a transnational and interdisciplinary framework

Integrating nowcasting with crisis management and risk prevention in a transnational and interdisciplinary framework

Measuring crisis risk using conditional copulas: An empirical analysis of the 2008 shipping crisis

SummaryThe shipping crisis starting in 2008 was characterized by sharply decreasing freight rates and sharply increasing financing costs. We analyze the dependence structure of these two risk factors employing a conditional copula model. As conditioning factors we use the supply and demand of seaborne transportation. We find that crisis risk strongly increased already about 1 year before the actual crisis outburst and that the shipping crisis was predominantly driven by an oversupply of transport capacity. Therefore, market participants could have prevented or alleviated the consequences of the crisis by reducing the ordering and financing of new vessels.

A clinical predictive score for postoperative myasthenic crisis

Myasthenia gravis (MG) is an autoimmune disease mostly caused by autoantibodies against acetylcholine receptor associated with thymus abnormalities. Thymectomy has been proven to be an efficacious treatment for patients with MG, but postoperative myasthenic crisis often occurs and is a major complication. We aimed to develop and validate a simple scoring system based on clinical characteristics in the preoperative status to predict the risk of postoperative myasthenic crisis. We studied 393 patients with MG who underwent thymectomy at 6 tertiary centers in Japan (275 patients for derivation and 118 for validation). Clinical characteristics, such as gender, age at onset and operation, body mass index, disease duration, MG subtype, severity, symptoms, preoperative therapy, operative data, and laboratory data, were reviewed retrospectively. A multivariate logistic regression with LASSO penalties was used to determine the factors associated with postoperative myasthenic crisis, and a score was assigned. Finally, the predictive score was evaluated using bootstrapping technique in the derivation and validation groups. Multivariate logistic regression identified 3 clinical factors for predicting postoperative myasthenic crisis risk: (1) vital capacity < 80%, (2) disease duration < 3 months, and (3) bulbar symptoms immediately before thymectomy. The postoperative myasthenic crisis predictive score, ranging from 0 to 6 points, had areas under the curve of 0.84 (0.66-0.96) in the derivation group and 0.80 (0.62-0.95) in the validation group. A simple scoring system based on 3 preoperative clinical characteristics can predict the possibility of postoperative myasthenic crisis. Ann Neurol 2017;82:841-849.

The Best Strategies for the Worst Crises

Hedging equity portfolios against the risk of large drawdowns is notoriously difficult and expensive. Holding, and continuously rolling, at-the-money put options on the S&P 500 is a very costly, if reliable, strategy to protect against market sell-offs. Holding ‘safe-haven’ US Treasury bonds, while providing a positive and predictable long-term yield, is generally an unreliable crisis-hedge strategy, since the post-2000 negative bond-equity correlation is a historical rarity. Long gold and long credit protection portfolios appear to sit between puts and bonds in terms of both cost and reliability. In contrast to these passive investments, we investigate two dynamic strategies that appear to have generated positive performance in both the long-run but also particularly during historical crises: futures time-series momentum and quality stock factors. Futures momentum has parallels with long option straddle strategies, allowing it to benefit during extended equity sell-offs. The quality stock strategy takes long positions in highest-quality and short positions in lowest-quality company stocks, benefitting from a ‘flight-to-quality’ effect during crises. These two dynamic strategies historically have uncorrelated return profiles, making them complementary crisis risk hedges. We examine both strategies and discuss how different variations may have performed in crises, as well as normal times, over the years 1985 to 2016.

Of Earthquakes and Epidemics: Examining the Applicability of the All‐Hazards Approach in Public Health Emergencies

While the All‐Hazards approach has been a fixture in disaster management in the United States for approximately three decades, discussion continues regarding the appropriateness of including public health emergencies under the All‐Hazards umbrella. Drawing on the disaster and public health literatures, we examine previous research in three areas of relevance to these events: convergence, risk and crisis communication, and providing medical services. Although events often include characteristics unique to each particular hazard, the literature demonstrates that there are sufficient similarities in these areas to advocate for the continued utility of the All‐Hazards approach. Convergence of people, material, and information often follow both disasters and public health emergencies, and present similar challenges and opportunities as a result. Crisis risk communication for these events rests on similar underlying theories, and presents similar challenges for practitioners, imposing similar demands on the medical system, both increasing needs for medical services and compromising the system's ability to provide services to meet those needs. Research is needed to explore further parallels between hazards, particularly in mitigation and recovery and in other national contexts. Future work should include direct, empirical comparisons across event types, and include other kinds of environmental or public health hazards.

Capital structure, tax effect, financial crisis and default risk: evidence from emerging market

The central objective of this study is to investigate the effect of capital structure on corporate failure in the emerging market, in particular Jordan, using a panel data analysis sample representative of 180 Jordanian companies during the period 1990 to 2012. This paper also examines the effect of the financial crisis 2008 on Jordanian corporate insolvency. The level of corporate leverage was found to have a positive effect on the probability of default (PD). Firms with lower bankruptcy costs have a lower probability of default (PD).

Исследование финансово-сбытовой деятельности предприятия с применением метода анализа коэффициентов (на примере ПАО «КамАЗ»)

In 2014–2015, Russia faced a range of economic problems, which affected activity of many local companies, including KAMAZ PJSC. There is a need to conduct an analysis of the KAMAZ’s financial and sales activities, since this company is a leader in the Russian market of specialized vehicles and their component parts. In this paper, the analysis is carried out through the use of the coefficient method, which has shown that in 2014–2015 KAMAZ PJSC was on the verge of crisis. In this regard, the paper has proposed the list of measures, the implementation of which will stabilize the corporation’s financial condition and strengthen its position in the market in the long term. Also the background of minimization KAMAZ’s crisis risks have been identified.

The Choice between Project Financing and Corporate Financing: Evidence from the Corporate Syndicated Loan Market

This paper examines the pricing of project finance (PF) and non-project finance (non-PF) loans and examines the factors that influence the borrower’s choice between project financing and corporate financing. Using a sample of 210,273 syndicated loans closed between 2000 and 2014, we find that PF and Non-PF loans are influenced differently by common pricing characteristics and that PF loans in the U.S. and W.E. are priced in segmented markets. Borrowers choose PF when they seek long-term financing and funding cost reduction. We find that transaction cost considerations, the financial crisis and country risk affect the financing choice. Our results document that publicly traded sponsors who prefer project financing to corporate financing are larger, less profitable, more financially distressed and have a higher asset tangibility. Finally, privately held firms that choose off-balance sheet financing are smaller and less profitable and use PF to raise relatively larger amounts of debt.

The Shipping Crisis Starting in 2008: Could It Have Been Avoided?

The shipping crisis starting in 2008 was characterized by sharply decreasing freight rates and sharply increasing financing costs. This led to numerous insolvencies of shipping companies and impairment losses of their lending institutions. We analyze the dependence structure of these two risk factors employing a conditional copula model with a focus on time-varying tail dependence, which we interpret as shipping crisis risk. As conditioning factors we use the supply and demand of seaborne transportation. We find that crisis risk strongly increased already about one year before the actual outburst of the crisis. Our results also show that the shipping crisis was predominantly driven by an oversupply of transport capacity rather than a declining demand. Taken these results together, market participants could have avoided or alleviated the crisis' consequences by reducing the ordering and financing of new vessels.

Macrofinancial History and the New Business Cycle Facts

In advanced economies, a century-long near-stable ratio of credit to GDP gave way to rapid financialization and surging leverage in the last forty years. This “financial hockey stick” coincides with shifts in foundational macroeconomic relationships beyond the widely-noted return of macroeconomic fragility and crisis risk. Leverage is correlated with central business cycle moments, which we can document thanks to a decade-long international and historical data collection effort. More financialized economies exhibit somewhat less real volatility, but also lower growth, more tail risk, as well as tighter real-real and real-financial correlations. International real and financial cycles also cohere more strongly. The new stylized facts that we discover should prove fertile ground for the development of a new generation of macroeconomic models with a prominent role for financial factors.

Macrofinancial History and the New Business Cycle Facts

In advanced economies, a century-long, near-stable ratio of credit to GDP gave way to rapid financialization and surging leverage in the last forty years. This “financial hockey stick” coincides with shifts in foundational macroeconomic relationships beyond the widely noted return of macroeconomic fragility and crisis risk. Leverage is correlated with central business cycle moments, which we can document thanks to a decade-long international and historical data collection effort. More financialized economies exhibit somewhat less real volatility, but also lower growth, more tail risk, as well as tighter real-real and real-financial correlations. International real and financial cycles also cohere more strongly. The new stylized facts that we discover should prove fertile ground for the development of a new generation of macroeconomic models with a prominent role for financial factors.

From the Rescue of Banks to the Single Resolution Mechanism: Institutional and Empirical Analysis

The analysis of the new system of bank resolution shows the extreme complexity of the mechanism and the variety and impact of the tools available. The BRRD organises the articulation of public tasks for banking crises in three different phases: the ordinary course of business, the early intervention, and finally the situation of banks in distress or at risk of collapse; in the last one there are the conditions for resolution. The most stricking point appeared the bail-in, that has transferred the crisis risk from taxpayers to investors and savers. In fact, the dismantling of the national protection network was not, in the meantime, balanced by the introduction of the planned European protection. In the present analysis we focus on the resolution capacity of Italian banks and examine the implications of the new bail-in tool for banks’ activity and business strategies. According to our findings lending-oriented banks feature a relatively lower bail-in contribution capacity. Moreover, resolution capacity increases with size, while income diversification is found neutral. On aggregate values, we find a contraction of resolution capacity of Italian banking system in recent years, similarly to what found for the European banking system (see Ayadi and de Groen, 2015). Overall our results suggest that the new bail-in rules may imply a reassessment of the traditional retail business model towards greater income diversification, with the risk of penalising small businesses which are still the backbone of the Italian economy. As regards policy implications, our findings support, as the main option, the strategy of aggregations for strengthening the resolution capacity of the Italian banking system.