The relative risk/prevalence ratio and odds ratio are very popular in medical research and epidemiological studies. The odds ratio is overused in practice due to its direct relation with the logistic regression. Interpreting the odds ratio in terms of “relative risk” may lead to incorrect...

In this paper we first analyze the stylized facts of electricity prices, in particular, the extreme volatility and price spikes which lead to heavy-tailed distributions of price changes. Then we calibrate Markov regime-switching (MRS) models with heavy-tailed components and show that they...