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Research carried out by Cairns (Maxwell Institute), Blake (Cass Business School) and Dowd (Nottingham, now Durham) in 2006 produced the `CBD' model for predicting future life expectancy. The CBD model and its extensions developed in 2009 by Cairns and collaborators have had a major impact on pensions and life industry risk management practices: multinational financial institutions [text removed for publication] and other stakeholders have relied on the CBD model to risk assess, price and execute financial deals [text removed for publication] since 2010. CBD is also used by risk management consultants to advise clients, is embedded in both open-source and commercial software, and is used by the UK's Pension Protection Fund to measure and manage longevity risk.
Research by Cathcart, McNeil (both Maxwell Institute) and Morrison (Barrie & Hibbert) during the period 2008-2012 has developed a methodology based on least squares Monte Carlo to value complex insurance liabilities and manage their risks. This methodology has been adopted by Barrie & Hibbert (B&H, part of Moody's Analytics) and has enabled the company to develop an internationally leading proposition for valuing insurance products. This has generated £2.5M in revenue since 2011, through implementation in 5 new products and use in 12 new consulting projects.
Loudness is the subjective magnitude of a sound as perceived by human listeners and it plays an important role in many human activities. It is determined jointly by the physical characteristics of a sound and by characteristics of the human auditory system. A model for predicting the loudness of sounds from their physical spectra was developed in the laboratory of Professor Brian Moore with support from an MRC programme grant.
The model formed the basis for an American National Standard and is currently being prepared for adoption as a standard by the International Organization for Standardisation (ISO). In addition, the model has been widely used in industry worldwide for prediction of the loudness of sounds, for example: noise from heating, ventilation and air-conditioning; inside and outside cars, and from aircraft; and from domestic appliances and machinery.
Research by Reimer Kühn (RK) and collaborators has produced a framework to study and quantify the influence of interactions on risk in complex systems, including default risk in economy-wide networks of financial exposures. This work has had impact on practitioners and professional services dealing with financial risk, including research groups at central banks, who — partly in response to the recent financial crisis — have adopted such network oriented approaches to analyse and quantify systemic risk. The Financial Stability Division at the Bank of England has, for instance, developed refined versions of the network-oriented models proposed by Kühn and collaborators to specifically assess risk in the British banking system.
Research at the University of Sheffield to evaluate the cost-effectiveness of different treatments for women with osteoporosis was used by the National Institute of Health and Care Excellence (NICE) to develop their guidance on the condition. The evaluation model was the first to combine cost-effectiveness of both treatment and screening and to include more detailed categorisation of patients. The model was used by NICE in their 2005, 2008 and 2011 guidance, which is mandatory for the NHS in England and Wales, and, therefore, since 2008 has influenced the treatment of over two million women with osteoporosis.
A two-dimensional flood inundation model called LISFLOOD-FP, which was created by a team led by Professor Paul Bates at the University of Bristol, has served as a blueprint for the flood risk management industry in the UK and many other countries. The documentation and published research for the original model, developed in 1999, and the subsequent improvements made in over a decade of research, have been integrated into clones of LISFLOOD-FP that have been produced by numerous risk management consultancies. This has not only saved commercial code developers' time but also improved the predictive capability of models used in a multimillion pound global industry that affects tens of millions of people annually. Between 2008 and 2013, clones of LISFLOOD-FP have been used to: i) develop national flood risk products for countries around the world; ii) facilitate the pricing of flood re-insurance contracts in a number of territories worldwide; and iii) undertake numerous individual flood inundation mapping studies in the UK and overseas. In the UK alone, risk assessments from LISFLOOD-FP clones are used in the Environment Agency's Flood Map (accessed on average 300,000 times a month by 50,000 unique browsers), in every property legal search, in every planning application assessment and in the pricing of the majority of flood re-insurance contracts. This has led to more informed and, hence, better flood risk management. A shareware version of the code has been available on the University of Bristol website since December 2010. As of September 2013, the shareware had received over 312 unique downloads from 54 different countries.
Industrial regions around the UK are seeking to develop bio-based economies in order to minimise their CO2 emissions and stimulate economic regeneration.
Researchers at Surrey, in collaboration with key industrialists from the Humber region, have produced a mathematical model of the main factors influencing the transition to, and establishment of, a bio-based economy. This model has been used by the Humber Environmental Managers (HEM) group, and the Humber local authorities to help guide strategic planning for the region. The outcome is that the research has contributed to environmental improvement and economic regeneration of the Humber region, and has indirectly impacted on public policy.
LSE research on endogenous risk has had impact at both the macro and micro level. At the macro level, it provided input for the design of the counter-cyclical measures and systemic risk surcharges in the Basel III regulations in financial markets. It also provided a significant input to the G20 agenda on financial stability. At the micro level, the research has had a significant role in shaping the thinking and recommendations of the UK Foresight Report on "The Future of Computer Trading in Financial Markets". Through this, the work had a direct impact on Markets in Financial Instruments Directive (MiFID) II, the EU legislation that governs how EU financial service markets operate. The original EC proposal for trading halts in volatile markets — Minimum Resting Times (MRT) — to regulate high frequency trading was dropped and the Foresight proposal of time stamps based on synchronised atomic clocks across trading venues was adopted.
Professor Robin Blackburn has written extensively on pension policy and has advocated the need for strong public pension provision. Following the financial crisis that began in 2008, Blackburn's ideas have attracted much interest, especially given that he had identified many of the problems that would come to afflict private schemes. His work has been recognised globally: for example, he was invited to speak at a conference organised by the EU Commissioner for Employment, Social Affairs and Inclusion, and his research has been cited by the United Nations' Department of Economic and Social Affairs. Blackburn's highest-profile work has been in Ecuador, where he has addressed the President, cabinet ministers, and senior civil servants.
The European Central Bank (ECB) uses forecasting tools to make predictions about the Eurozone economy as a whole. The University of Leicester has worked with the ECB to modify its main forecasting tool to improve its ability to take effective and timely action to keep inflation low and minimise deflation.
Similarly, the United Nations prepares a submission to each G8 Summit which includes forecasting and policy analysis based on the economies of the 193 member states. The forecasting tool used to create this submission has also been created in collaboration with the University of Leicester. These modelling tools help the world's most powerful leaders - both political and financial - to make informed and timely decisions about issues affecting economic stability, global food security and international safety.