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3,700
A Dynamical Model of the Industrial Economy of the Humber Region
q-fin.EC
The Humber region in the UK is a large and diverse industrial area centred around oil refining, chemical industries and energy production. However there is currently a desire to see the region transition towards a more bio-based economy. New bio-related industries are being situated in the region as a consequence of po...
finance
3,701
Stability and Identification with Optimal Macroprudential Policy Rules
q-fin.EC
This paper investigates the identification, the determinacy and the stability of ad hoc, "quasi-optimal" and optimal policy rules augmented with financial stability indicators (such as asset prices deviations from their fundamental values) and minimizing the volatility of the policy interest rates, when the central ban...
finance
3,702
The Italian Crisis and Producer Households Debt: a Source of Stability? A Reproducible Research
q-fin.EC
The European Credit Research Institute Research Report 2013 identifies Households debt "rapid increase and abrupt retrenchment" among the causes of macroeconomic instability in the European Union after 2008. In our research: i) we accessed the Bank of Italy Online Statistical Database on Customers and Risk for Producer...
finance
3,703
Can Analysts Predict Rallies Better Than Crashes?
q-fin.EC
We use the copula approach to study the structure of dependence between sell-side analysts' consensus recommendations and subsequent security returns, with a focus on asymmetric tail dependence. We match monthly vintages of I/B/E/S recommendations for the period January to December 2011 with excess security returns dur...
finance
3,704
Strategy-proofness and single-peackedness in bounded distributive lattices
q-fin.EC
Two distinct specifications of single peakedness as currently met in the relevant literature are singled out and discussed. Then, it is shown that, under both of those specifications, a voting rule as defined on a bounded distributive lattice is strategy-proof on the set of all profiles of single peaked total preorders...
finance
3,705
Superstars in politics: the role of the media in the rise and success of Junichiro Koizumi
q-fin.EC
This paper explores the role of mass media in people perceptions of charismatic leaders, focusing on the case of Junichiro Koizumi, Prime Minister of Japan from 2001 to 2006. Using survey data collected immediately after his 2005 landslide electoral victory, this study empirically assesses the influence of television a...
finance
3,706
Microscopic Models for Welfare Measures Addressing a Reduction of Economic Inequality
q-fin.EC
We formulate a flexible micro-to-macro kinetic model which is able to explain the emergence of income profiles out of a whole of individual economic interactions. The model is expressed by a system of several nonlinear differential equations which involve parameters defined by probabilities. Society is described as an ...
finance
3,707
A finite set of equilibria for the indeterminacy of linear rational expectations models
q-fin.EC
This paper demonstrates the existence of a finite set of equilibria in the case of the indeterminacy of linear rational expectations models. The number of equilibria corresponds to the number of ways to select n eigenvectors among a larger set of eigenvectors related to stable eigenvalues. A finite set of equilibria is...
finance
3,708
Semiparametric Estimation of First-Price Auction Models
q-fin.EC
We propose a semiparametric method to estimate the density of private values in first-price auctions. Specifically, we model private values through a set of conditional moment restrictions and use a two-step procedure. In the first step we recover a sample of pseudo private values using Local Polynomial Estimator. In t...
finance
3,709
Structural social capital and health in Italy
q-fin.EC
This paper presents the first empirical assessment of the causal relationship between social capital and health in Italy. The analysis draws on the 2000 wave of the Multipurpose Survey on Household conducted by the Italian Institute of Statistics on a representative sample of the population (n = 46,868). Our measure of...
finance
3,710
Indicators of availability of non-market relations in the sphere of labor market in Ukraine
q-fin.EC
There are identified indicators of availability a non-market relations in the sphere of labor market in Ukraine. It is concluded that illegal tax money paid by legally working in Ukraine, as insurance premiums in the event of unemployment. It is concluded that increased pressure from the government on labor market regu...
finance
3,711
Visualising stock flow consistent models as directed acyclic graphs
q-fin.EC
We show how every stock-flow consistent model of the macroeconomy can be represented as a directed acyclic graph. The advantages of representing the model in this way include graphical clarity, causal inference, and model specification. We provide many examples implemented with a new software package.
finance
3,712
Turnpike Property and Convergence Rate for an Investment Model with General Utility Functions
q-fin.EC
In this paper we aim to address two questions faced by a long-term investor with a power-type utility at high levels of wealth: one is whether the turnpike property still holds for a general utility that is not necessarily differentiable or strictly concave, the other is whether the error and the convergence rate of th...
finance
3,713
On the convergence of the Fitness-Complexity Algorithm
q-fin.EC
We investigate the convergence properties of an algorithm which has been recently proposed to measure the competitiveness of countries and the quality of their exported products. These quantities are called respectively Fitness F and Complexity Q. The algorithm was originally based on the adjacency matrix M of the bipa...
finance
3,714
RHOMOLO: A Dynamic Spatial General Equilibrium Model for Assessing the Impact of Cohesion Policy
q-fin.EC
The paper presents the newly developed dynamic spatial general equilibrium model of European Commission, RHOMOLO. The model incorporates several elements from economic geography in a novel and theoretically consistent way. It describes the location choice of different types of agents and captures the interplay between ...
finance
3,715
Conditional Preference Orders and their Numerical Representations
q-fin.EC
We provide an axiomatic system modeling conditional preference orders which is based on conditional set theory. Conditional numerical representations are introduced, and a conditional version of the theorems of Debreu on the existence of numerical representations is proved. The conditionally continuous representations ...
finance
3,716
Comeback kids: an evolutionary approach of the long-run innovation process
q-fin.EC
We provide a theoretical framework to understand when firms may benefit from exploiting previously abandoned technologies and brands. We model for the long run process of innovation, allowing for sustainable diversity and comebacks of old brands and technologies. We present two extensions to the logistic and Lotka-Volt...
finance
3,717
Long Term Risk: A Martingale Approach
q-fin.EC
This paper extends the long-term factorization of the stochastic discount factor introduced and studied by Alvarez and Jermann (2005) in discretetime ergodic environments and by Hansen and Scheinkman (2009) and Hansen (2012) in Markovian environments to general semimartingale environments. The transitory component disc...
finance
3,718
Identifying Multidiemsnional Adverse Selection Models
q-fin.EC
In this paper, I study the nonparametric identification of a multidimensional adverse selection model. In particular, I consider the screening model of Rochet and Chone (1998), where products have multiple characteristics and consumers have private information about their multidimensional taste for these characteristic...
finance
3,719
An Optimal Multiple Stopping Approach to Infrastructure Investment Decisions
q-fin.EC
The energy and material processing industries are traditionally characterized by very large-scale physical capital that is custom-built with long lead times and long lifetimes. However, recent technological advancement in low-cost automation has made possible the parallel operation of large numbers of small-scale and m...
finance
3,720
Market Dynamics and Indirect Network Effects in Electric Vehicle Diffusion
q-fin.EC
The diffusion of electric vehicles (EVs) is studied in a two-sided market framework consisting of EVs on the one side and EV charging stations (EVCSs) on the other. A sequential game is introduced as a model for the interactions between an EVCS investor and EV consumers. A consumer chooses to purchase an EV or a conven...
finance
3,721
Pareto Efficient Nash Implementation Via Approval Voting
q-fin.EC
We study implementation of a social choice correspondence in the case of two players who have von Neumann - Morgenstern utilities over a finite set of social alternatives, and the mechanism is allowed to output lotteries. Our main positive result shows that a close variant of the popular approval voting mechanism succe...
finance
3,722
International R&D Spillovers and other Unobserved Common Spillovers and Shocks
q-fin.EC
Studies which are based on Coe and Helpman (1995) and use weighted foreign R&D variables to estimate channel-specific R&D spillovers disregard the interaction between international R&D spillovers and other unobserved common spillovers and shocks. Using a panel of 50 economies from 1970-2011, we find that disregarding t...
finance
3,723
Re-visiting the Distance Coefficient in Gravity Model
q-fin.EC
This paper revisits the classic gravity model in international trade and reexamines the distance coefficient. As pointed out by Frankel (1997), this coefficient measures the relative unit transportation cost between short distance and long distance rather than the absolute level of average transportation cost. Our resu...
finance
3,724
Dynamic Games with Almost Perfect Information
q-fin.EC
This paper aims to solve two fundamental problems on finite or infinite horizon dynamic games with perfect or almost perfect information. Under some mild conditions, we prove (1) the existence of subgame-perfect equilibria in general dynamic games with almost perfect information, and (2) the existence of pure-strategy ...
finance
3,725
Empirical Relevance of Ambiguity in First Price Auction Models
q-fin.EC
We study the identification and estimation of first-price auction models where bidders have ambiguity about the valuation distribution and their preferences are represented by maxmin expected utility. When entry is exogenous, the distribution and ambiguity structure are nonparametrically identified, separately from ris...
finance
3,726
The Social Cost of Carbon with Economic and Climate Risks
q-fin.EC
There is great uncertainty about future climate conditions and the appropriate policies for managing interactions between the climate and the economy. We develop a multidimensional computational model to examine how uncertainties and risks in the economic and climate systems affect the social cost of carbon (SCC)---tha...
finance
3,727
Homogenization and Clustering as a Non-Statistical Methodology to Assess Multi-Parametrical Chain Problems
q-fin.EC
We present a new theoretical and numerical assessment methodology for a one-dimensional process chain with general applicability to management problems such as the optimization of decision chains or production chains. The process is thereby seen as a chain of subsequently arranged units with random parameters influenci...
finance
3,728
From 0D to 1D spatial models using OCMat
q-fin.EC
We show that the standard class of optimal control models in OCMat can be used to analyze 1D spatial distributed systems. This approach is an intermediate step on the way to the FEM discretization approach presented in Grass and Uecker (2015). Therefore, the spatial distributed model is transformed into a standard mode...
finance
3,729
On the Failures of Bonus Plans
q-fin.EC
A decision maker (DM) has some funds invested through two investment firms. She wishes to allocate additional funds according to the firms' earnings. The DM, on the one hand, tries to maximize the total expected earnings, while the firms, on the other hand, try to maximize the overall expected funds they manage. In thi...
finance
3,730
Optimal forest rotation age under efficient climate change mitigation
q-fin.EC
This paper considers the optimal rotation of forests when the carbon flows of forest growth and harvest are priced with an increasing price. Such an evolution of carbon price is generally associated with economically efficient climate change mitigation, and would provide incentives for the land-owner for enhanced carbo...
finance
3,731
The Theory of a Heliospheric Economy
q-fin.EC
Despite more than 50 years of human space exploration, no paper in the field of economics has been published regarding the theory of a space-based economy. The aim of this paper is to develop quantitative techniques to estimate conditions of the human heliospheric expansion. An empirical analysis of current space comme...
finance
3,732
Business cycle synchronization within the European Union: A wavelet cohesion approach
q-fin.EC
In this paper, we map the process of business cycle synchronization across the European Union. We study this synchronization by applying wavelet techniques, particularly the cohesion measure with time-varying weights. This novel approach allows us to study the dynamic relationship among selected countries from a differ...
finance
3,733
Time-scale analysis of co-movement in EU sovereign bond markets
q-fin.EC
We study the co-movement of the 10-year sovereign bond yields of 11 EU countries. Our analysis is focused mainly on changes in co-movement during the financial crisis period, especially around two significant dates - the fall of Lehman Brothers, September 15, 2008, and the announcement of the increase of Greece's publi...
finance
3,734
How log-normal is your country? An analysis of the statistical distribution of the exported volumes of products
q-fin.EC
We have considered the statistical distributions of the volumes of the different products exported by 148 countries. We have found that the form of these distributions is not unique but heavily depends on the level of development of the nation, as expressed by macroeconomic indicators like GDP, GDP per capita, total ex...
finance
3,735
Resolute refinements of social choice correspondences
q-fin.EC
Many classical social choice correspondences are resolute only in the case of two alternatives and an odd number of individuals. Thus, in most cases, they admit several resolute refinements, each of them naturally interpreted as a tie-breaking rule, satisfying different properties. In this paper we look for classes of ...
finance
3,736
A Bayesian Model of the Litigation Game
q-fin.EC
Over a century ago, Oliver Wendell Holmes invited scholars to look at the law through the lens of probability theory: "The prophecies of what the courts will do in fact, and nothing more pretentious, are what I mean by the law." Yet few legal scholars have taken up this intriguing invitation. As such, in place of previ...
finance
3,737
Note on tax enforcement and transfer pricing manipulation
q-fin.EC
This note proposes the segregation of independent endogenous and exogenous components of tax penalty probability to introduce a formal demonstration that enforcement and tax penalties are negatively related with income shifting. JEL F23; H26.
finance
3,738
Analysis of Professional Trajectories using Disconnected Self-Organizing Maps
q-fin.EC
In this paper we address an important economic question. Is there, as mainstream economic theory asserts it, an homogeneous labor market with mechanisms which govern supply and demand for work, producing an equilibrium with its remarkable properties? Using the Panel Study of Income Dynamics (PSID) collected on the peri...
finance
3,739
Inequality and risk aversion in economies open to altruistic attitudes
q-fin.EC
This paper attempts to find a relationship between agents' risk aversion and inequality of incomes. Specifically, a model is proposed for the evolution in time of surplus/deficit distribution, and the long-time distributions are characterized almost completely. They turn out to be weak Pareto laws with exponent linked ...
finance
3,740
Axiomatization of the Choquet integral for 2-dimensional heterogeneous product sets
q-fin.EC
We prove a representation theorem for the Choquet integral model. The preference relation is defined on a two-dimensional heterogeneous product set $X = X_1 \times X_2$ where elements of $X_1$ and $X_2$ are not necessarily comparable with each other. However, making such comparisons in a meaningful way is necessary for...
finance
3,741
Modélisation spatiale de la formation des agglomérations dans la zone algéroise
q-fin.EC
The goal of this study is to analyze the dynamics underlying Algiers urban area formation with reference to The New Economic Geography (NEG) theories and more precisely to the paper of Paul Krugman (1991), "Increasing returns and economic geography" which explains the mechanisms of economic activities concentration thr...
finance
3,742
Existence of continuous euclidean embeddings for a weak class of orders
q-fin.EC
We prove that if $X$ is a topological space that admits Debreu's classical utility theorem (eg.\ $X$ is separable and connected, second countable, etc.), then order relations on $X$ satisfying milder completeness conditions can be continuously embedded in $\mathbb R^I$ for $I$ some index set. In the particular case whe...
finance
3,743
Role of non-timber forest products in sustaining forest-based livelihoods and rural households' resilience capacity in and around protected area- a Bangladesh study
q-fin.EC
People in developing world derive a significant part of their livelihoods from various forest products, particularly non-timber forest products. This article attempts to explore the contribution of NTFPs in sustaining forest-based rural livelihood in and around a protected area of Bangladesh, and their potential role i...
finance
3,744
A Model for Tax Evasion with Some Realistic Properties
q-fin.EC
We present a discrete-time dynamic model of income tax evasion. The model is solved exactly in the case of a single taxpayer and shown to have some realistic properties, including avoiding the Yitzhaki paradox. The extension to an agent-based model with a network of taxpayers is also investigated.
finance
3,745
Transfer pricing manipulation, tax penalty cost and the impact of foreign profit taxation
q-fin.EC
This paper analizes the optimal level of transfer pricing manipulation when the expected tax penalty is a function of the tax enforcement and the market price parameter. The arm's length principle implies the existence of a range of acceptable prices shaped by market, and firms can manipulate transfer prices more freel...
finance
3,746
Optimal Taxation with Endogenous Default under Incomplete Markets
q-fin.EC
In a dynamic economy, we characterize the fiscal policy of the government when it levies distortionary taxes and issues defaultable bonds to finance its stochastic expenditure. Default may occur in equilibrium as it prevents the government from incurring in future tax distortions that would come along with the service ...
finance
3,747
The nonlinear Bernstein-Schrödinger equation in Economics
q-fin.EC
In this paper we relate the Equilibrium Assignment Problem (EAP), which is underlying in several economics models, to a system of nonlinear equations that we call the "nonlinear Bernstein-Schr\"odinger system", which is well-known in the linear case, but whose nonlinear extension does not seem to have been studied. We...
finance
3,748
Is Collusion-Proof Procurement Expensive?
q-fin.EC
Collusion among bidders adversely affects procurement cost and in some cases efficiency, and it seems collusion is more prevalent that we would like. Statistical methods of detecting collusion just using bid data, in a hope to deter future collusion, is perilous, and access to additional data is rare and often always a...
finance
3,749
Autonomics: an autonomous and intelligent economic platform and next generation money tool
q-fin.EC
We propose a high level network architecture for an economic system that integrates money, governance and reputation. We introduce a method for issuing, and redeeming a digital coin using a mechanism to create a sustainable global economy and a free market. To maintain a currency's value over time, and therefore be mon...
finance
3,750
The Poker-Litigation Game
q-fin.EC
Is litigation a serious search for truth or simply a game of skill or luck? Although the process of litigation has been modeled as a Prisoner's Dilemma, as a War of Attrition, as a Game of Chicken and even as a simple coin toss, no one has formally modeled litigation as a game of poker. This paper is the first to do so...
finance
3,751
Dynamic Model of the Price Dispersion of Homogeneous Goods
q-fin.EC
Presented is an analytic microeconomic model of the temporal price dispersion of homogeneous goods in polypoly markets. This new approach is based on the idea that the price dispersion has its origin in the dynamics of the purchase process. The price dispersion is determined by the chance that demanded and supplied pro...
finance
3,752
Measuring economic complexity of countries and products: which metric to use?
q-fin.EC
Evaluating the economies of countries and their relations with products in the global market is a central problem in economics, with far-reaching implications to our theoretical understanding of the international trade as well as to practical applications, such as policy making and financial investment planning. The re...
finance
3,753
Interdisciplinary Business Games on Sustainable Development: Theoretical Foundations and Prospects of Implementation
q-fin.EC
The article defines the place of business games among all games in general based on the classification by F.G. Junger; it provides critical analysis of existing business games types; it also formulates requirements and lays theoretical foundations and elements of the methodology and organization of interdisciplinary bu...
finance
3,754
The Principle of the Malevolent Hiding Hand; or, the Planning Fallacy Writ Large
q-fin.EC
We identify and document a new principle of economic behavior: the principle of the Malevolent Hiding Hand. In a famous discussion, Albert Hirschman celebrated the Hiding Hand, which he saw as a benevolent mechanism by which unrealistically optimistic planners embark on unexpectedly challenging plans, only to be rescue...
finance
3,755
IMF Lending and Economic Growth: An Empirical Analysis of Ukraine
q-fin.EC
This study uses Vector Autoregression (VAR) Methodology as well as Vector Error Correction (VEC) Methodology to examine the existence and direction of causality between economic growth and IMF lending for Ukraine. The paper examines the IMF lending data for the period of 1991-2010. Robust empirical analysis indicates t...
finance
3,756
Universalized Prisoner's Dilemma With Risk
q-fin.EC
In this paper I present a mathematically novel approach to the Prisoner's Dilemma. I do so by first defining recursively a distinct action type, what I call 'universalizing', that I add to the original prisoner's dilemma. Such a modified version of the Prisoner's Dilemma provides a very food productive model of the cho...
finance
3,757
Information equilibrium as an economic principle
q-fin.EC
A general information equilibrium model in the case of ideal information transfer is defined and then used to derive the relationship between supply (information destination) and demand (information source) with the price as the detector of information exchange between demand and supply. We recover the properties of th...
finance
3,758
The Corporate Social Responsibility is just a twist in a Möbius Strip
q-fin.EC
In recent years economics agents and systems have became more and more interacting and juxtaposed, therefore the social sciences need to rely on the studies of physical sciences to analyze this complexity in the relationships. According to this point of view we rely on the geometrical model of the M\"obius strip used i...
finance
3,759
Dynamics and Stability in Retail Competition
q-fin.EC
Retail competition today can be described by three main features: i) oligopolistic competition, ii) multi-store settings, and iii) the presence of large economies of scale. In these markets, firms usually apply a centralized decisions making process in order to take full advantage of economies of scales, e.g. retail di...
finance
3,760
Basic industrial funds of cargo motor transport enterprises: problems of effective use
q-fin.EC
This work investigates the structure of basic industrial funds of cargo motor transport enterprises and peculiarities of the processes of their reproduction in the conditions of social and economic relations transformation. On the basis of statistic data of cargo-motor transport enterprises of Ivano-Frankivsk, Lviv and...
finance
3,761
Estimating the Impact of Wind Generation in the UK
q-fin.EC
This paper studies the impact of wind generation on market prices and system costs in the UK between 2013 and 2014. The wider effects and implications of wind generation is of direct relevance and importance to policy makers, as well as the grid operator and market traders. We compare electricity generation from Coal, ...
finance
3,762
Mathematics of Predicting Growth
q-fin.EC
Mathematical methods of analysis of data and of predicting growth are discussed. The starting point is the analysis of the growth rates, which can be expressed as a function of time or as a function of the size of the growing entity. Application of these methods is illustrated using the world economic growth but they c...
finance
3,763
A Link between Sequential Semi-anonymous Nonatomic Games and their Large Finite Counterparts
q-fin.EC
We show that equilibria of a sequential semi-anonymous nonatomic game (SSNG) can be adopted by players in corresponding large but finite dynamic games to achieve near-equilibrium payoffs. Such equilibria in the form of random state-to-action rules are parsimonious in form and easy to execute, as they are both oblivious...
finance
3,764
Analysis of Markovian Competitive Situations using Nonatomic Games
q-fin.EC
For dynamic situations where the evolution of a player's state is influenced by his own action as well as other players' states and actions, we show that equilibria derived for nonatomic games (NGs) can be used by their large finite counterparts to achieve near-equilibrium performances. We focus on the case with quite ...
finance
3,765
Wage gap between men and women in Tunisia
q-fin.EC
This paper focuses on estimating wage differences between males and females in Tunisia by using the Oaxaca-Blinder decomposition, a technical that isolates wage gap due to characteristics, from wage gap due to discrimination against women. The data used in the analysis is obtained from the Tunisian Population and Emplo...
finance
3,766
A simple framework for the axiomatization of exponential and quasi-hyperbolic discounting
q-fin.EC
The main goal of this paper is to investigate which normative requirements, or axioms, lead to exponential and quasi-hyperbolic forms of discounting. Exponential discounting has a well-established axiomatic foundation originally developed by Koopmans (1960, 1972) and Koopmans et al. (1964) with subsequent contributions...
finance
3,767
Some Dynamic Market Models
q-fin.EC
In this text, we study the temporal behavior of markets using models expressible as ordinary differential equations. The markets studied are those where each customer buys only one copy of the good, for example, subscription of smartphone service, journals and newspapers, and goods such as books, music and games. The u...
finance
3,768
Water Stress on U.S. Power Production at Decadal Time Horizons
q-fin.EC
Thermoelectric power production at risk, owing to current and projected water scarcity and rising stream temperatures, is assessed for the contiguous United States at decadal scales. Regional water scarcity is driven by climate variability and change, as well as by multi-sector water demand. While a planning horizon of...
finance
3,769
Complex economies have a lateral escape from the poverty trap
q-fin.EC
We analyze the decisive role played by the complexity of economic systems at the onset of the industrialization process of countries over the past 50 years. Our analysis of the input growth dynamics, based on a recently introduced measure of economic complexity, reveals that more differentiated and more complex economi...
finance
3,770
Key drivers of EU budget allocation: Does power matter?
q-fin.EC
We examine the determinants of the EU budget expenditures allocation among different countries. In line with earlier literature, we consider two alternative explanations for the EU budget distribution: political power vs. needs view. Extending the original data set from Kauppi and Widgr\'en (2004), we analyze the robus...
finance
3,771
Optimal environmental tax swaps and double dividend hypothesis
q-fin.EC
Taking environmental tax rate as given, is there an optimal allocation of tax revenues to benefit economic variables? This paper analyzes this issue in an overlapping-generations model with the pollution-related health damage. It finds the optimal allocations towards pollution abatement and labor income to maximize the...
finance
3,772
Sovereign Default Risk and Uncertainty Premia
q-fin.EC
This paper studies how international investors' concerns about model misspecification affect sovereign bond spreads. We develop a general equilibrium model of sovereign debt with endogenous default wherein investors fear that the probability model of the underlying state of the borrowing economy is misspecified. Conseq...
finance
3,773
Unified Growth Theory Contradicted by the Economic Growth in Europe
q-fin.EC
Historical economic growth in Western and Eastern Europe is analysed. These regions should have produced the best and the most convincing confirmation of the Unified Growth Theory because they, and in particular Western Europe, were the centre of the Industrial Revolution, which according to Galor was the prime engine ...
finance
3,774
Essay on the State of Research and Innovation in France and the European Union
q-fin.EC
Innovation in the economy is an important engine of growth and no economy, whatever its complexity and degree of advancement, whether it is based on industry, agriculture, high tech or the providing of services, can be truly healthy without innovating actors within it. The aim of this work, done by an applied mathemati...
finance
3,775
Teaching Economics and Providing Visual "Big Pictures"
q-fin.EC
The goal of this paper is to investigate the importance of providing visual "big pictures" in the teaching of economics. The plurality and variety of concepts, variables, diagrams, and models involved in economics can be a source of confusion for many economics students. However, reviewing the existing literature on th...
finance
3,776
Do Mature Economies Grow Exponentially?
q-fin.EC
Most models that try to explain economic growth indicate exponential growth paths. In recent years, however, a lively discussion has emerged considering the validity of this notion. In the empirical literature dealing with drivers of economic growth, the majority of articles is based upon an implicit assumption of expo...
finance
3,777
A Statistical Model of Inequality
q-fin.EC
This paper develops a nonparametric statistical model of wealth distribution that imposes little structure on the fluctuations of household wealth. In this setting, we use new techniques to obtain a closed-form household-by-household characterization of the stable distribution of wealth and show that this distribution ...
finance
3,778
Empirical Methods for Dynamic Power Law Distributions in the Social Sciences
q-fin.EC
This paper introduces nonparametric econometric methods that characterize general power law distributions under basic stability conditions. These methods extend the literature on power laws in the social sciences in several directions. First, we show that any stationary distribution in a random growth setting is shaped...
finance
3,779
On the parameter identifiability problem in Agent Based economical models
q-fin.EC
Identifiability of parameters is a fundamental prerequisite for model identification. It concerns uniqueness of the model parameters determined from experimental or simulated observations. This dissertation specifically deals with structural or a priori identifiability: whether or not parameters can be identified from ...
finance
3,780
The Postulate of the Three Regimes of Economic Growth Contradicted by Data
q-fin.EC
Economic growth in Western Europe, Eastern Europe, Asia, countries of the former USSR, Africa and Latin America were analysed. It is demonstrated that the fundamental postulate of the Unified Growth Theory about the existence of the three regimes of growth (Malthusian regime, post-Malthusian regime and sustained-growth...
finance
3,781
The Invisible Hand of Laplace: the Role of Market Structure in Price Convergence and Oscillation
q-fin.EC
A fundamental question about a market is under what conditions, and then how rapidly, does price signaling cause price equilibration. Qualitatively, this ought to depend on how well-connected the market is. We address this question quantitatively for a certain class of Arrow-Debreu markets with continuous-time proporti...
finance
3,782
Fairs for e-commerce: the benefits of aggregating buyers and sellers
q-fin.EC
In recent years, many new and interesting models of successful online business have been developed. Many of these are based on the competition between users, such as online auctions, where the product price is not fixed and tends to rise. Other models, including group-buying, are based on cooperation between users, cha...
finance
3,783
Conjoint axiomatization of the Choquet integral for heterogeneous product sets
q-fin.EC
We propose an axiomatization of the Choquet integral model for the general case of a heterogeneous product set $X = X_1 \times \ldots \times X_n$. In MCDA elements of $X$ are interpreted as alternatives, characterized by criteria taking values from the sets $X_i$. Previous axiomatizations of the Choquet integral have b...
finance
3,784
Commodity Dynamics: A Sparse Multi-class Approach
q-fin.EC
The correct understanding of commodity price dynamics can bring relevant improvements in terms of policy formulation both for developing and developed countries. Agricultural, metal and energy commodity prices might depend on each other: although we expect few important effects among the total number of possible ones, ...
finance
3,785
Aggregating time preferences with decreasing impatience
q-fin.EC
It is well-known that for a group of time-consistent decision makers their collective time preferences may become time-inconsistent. Jackson and Yariv (2014) demonstrated that the result of aggregation of exponential discount functions always exhibits present bias. We show that when preferences satisfy the axioms of Fi...
finance
3,786
On the survival of poor peasants
q-fin.EC
Previously, in underdeveloped countries, people tried to keep the prices of food products artificially low, in order to help the poor to buy their food. But it became soon clear that such system, although helpful for the city poor, was disastrous for the peasants (who usually are even poorer), so that hunger increased,...
finance
3,787
Knight--Walras Equilibria
q-fin.EC
Knightian uncertainty leads naturally to nonlinear expectations. We introduce a corresponding equilibrium concept with sublinear prices and establish their existence. In general, such equilibria lead to Pareto inefficiency and coincide with Arrow--Debreu equilibria only if the values of net trades are ambiguity--free i...
finance
3,788
A constraint-based framework to study rationality, competition and cooperation in fisheries
q-fin.EC
In this paper, we present a simplified framework to represent competition, coordination and bargaining in fisheries when they operate under financial and technological constraints. Competition within constraints leads to a particular type of mathematical game in which the strategy choice by one player changes strategy ...
finance
3,789
A Contextual Model Of The Secessionist Rebellion in Eastern Ukraine
q-fin.EC
This paper explores the possible contextual factors that drove some individuals to lead, and others to join the pro-secessionist rebellion in the 2013-2014 conflict in Eastern Ukraine. We expand on the existing rational choice literature on revolutionary participation and rebellious movements by building a contextual c...
finance
3,790
Incentivizing Resilience in Financial Networks
q-fin.EC
When banks extend loans to each other, they generate a negative externality in the form of systemic risk. They create a network of interbank exposures by which they expose other banks to potential insolvency cascades. In this paper, we show how a regulator can use information about the financial network to devise a tra...
finance
3,791
Note on level r consensus
q-fin.EC
We show that the hierarchy of level $r$ consensus partially collapses. In particular, any profile $\pi\in \mathcal{P}$ that exhibits consensus of level $(K-1)!$ around $\succ_0$ in fact exhibits consensus of level $1$ around $\succ_0$.
finance
3,792
Inferring the contiguity matrix for spatial autoregressive analysis with applications to house price prediction
q-fin.EC
Inference methods in traditional statistics, machine learning and data mining assume that data is generated from an independent and identically distributed (iid) process. Spatial data exhibits behavior for which the iid assumption must be relaxed. For example, the standard approach in spatial regression is to assume th...
finance
3,793
Matrix-vector representation of various solution concepts
q-fin.EC
A unified matrix-vector representation is developed of such solution concepts as the core, the uncovered, the uncaptured, the minimal weakly stable, the minimal undominated, the minimal dominant and the untrapped sets. We also propose several new versions of solution sets.
finance
3,794
Alternative versions of the global competitive industrial performance ranking constructed by methods from social choice theory
q-fin.EC
The Competitive Industrial Performance index (developed by experts of the UNIDO) is designed as a measure of national competitiveness. Index is an aggregate of eight observable variables, representing different dimensions of competitive industrial performance.
finance
3,795
Fair division with divisible and indivisible items
q-fin.EC
In the work the fair division problem for two participants in presence of both divisible and indivisible items is considered. The set of all divisions is formally described; it is demonstrated that fair (in terms of Brams and Taylor) divisions, unlikely the case where all the items are divisible, not always exist. The ...
finance
3,796
Fashion, fads and the popularity of choices: micro-foundations for diffusion consumer theory
q-fin.EC
Knowledge acquisition by consumers is a key process in the diffusion of innovations. However, in standard theories of the representative agent, agents do not learn and innovations are adopted instantaneously. Here, we show that in a discrete choice model where utility-maximising agents with heterogenous preferences lea...
finance
3,797
The Oxford Olympics Study 2016: Cost and Cost Overrun at the Games
q-fin.EC
Given that Olympic Games held over the past decade each have cost USD 8.9 billion on average, the size and financial risks of the Games warrant study. The objectives of the Oxford Olympics study are to (1) establish the actual outturn costs of previous Olympic Games in a manner where cost can consistently be compared a...
finance
3,798
Self-organization in a distributed coordination game through heuristic rules
q-fin.EC
In this paper we consider a distributed coordination game played by a large number of agents with finite information sets, which characterizes emergence of a single dominant attribute out of a large number of competitors. Formally, $N$ agents play a coordination game repeatedly which has exactly $N$ Nash equilibria and...
finance
3,799
Multidimensional Polarization Index and its Application to an Analysis of the Russian State Duma
q-fin.EC
The multidimensional extension of the Aleskerov-Golubenko polarization index is developed. Several versions of the polarization index are proposed based on different distance functions. Basic properties of the index are examined.
finance