On Voting Power Indices and a Class of Probability Distributions: With applications to EU data

Properties of a class of voting power indices, defined as the expected number of swings under a probability model, are discussed. For decisive voting games swing sets exhibit symmetries which can be used to characterize the voting power indices. Numerical illustrations based on EU Council data are provided.     

A New Axiomatization of the Banzhaf Index for Games with Abstention

(3, 2)-Simple games are a model for voting situation in which players can vote not only in favour or against a proposal but they can also abstain. Also in this model, power indices are used to evaluate the power of players. In particular, the Banzhaf index and the Shapley–Shubik index have been generalized to define analogous power indices in the context of games with abstention. In this work we provide a new axiomatization of the Banzhaf index for games with abstention, to underline its properties and increase the justification of the use of this index as a solution concept also in the family of games with abstention.     

Markov chain Monte Carlo for incomplete information discrete games

This paper outlines a Bayesian approach to estimating discrete games of incomplete information. The MCMC routine proposed features two changes to the traditional Metropolis–Hastings algorithm to facilitate the estimation of games. First, we propose a new approach to sample equilibrium probabilities using a probabilistic equilibrium selection rule that allows for the evaluation of the parameter posterior. Second, we propose a differential evolution based MCMC sampler which is capable of handling the unwieldy posterior that only has support on the equilibrium manifold. We also present two applications to demonstrate the feasibility of our proposed methodology.     

A Multicriteria Selection System Based on Player Performance: Case Study—The Spanish ACB Basketball League

In this paper, we describe an approach to rank sport players based on their efficiency. Although is extremely useful to analyze the performance of team games there is no unanimity on the use of a single index to perform such a ranking. We propose a method to summarize the huge amount of information collected at different aspects of a sport team which is almost daily publicly available. The tool will allow agents involved in a player’s negotiation to show the strengths (and weaknesses) of the player with respect to other players. The approach is based on applying a multicriteria outranking methodology using as alternatives the potential players and as criteria different efficiency indices. A novel automatic parameter tuning approach is detailed that will allow coaches and sports managers to design templates and sports strategies that improve the efficiency of their teams. We report the results performed over the available information on the ACB Basketball League, and we show how it can be easily implemented and interpreted in practice by decision-makers non familiar with the mathematical side of the methodology.     

Koalitionsaussagen und die Verteilung der Macht in der deutschen Regierungskoalition

In this article, the author analyses the distribution of power in the current and possible German government coalitions following the federal election in September 2013 based on statements made by the parties with regard to various potential coalitions in advance of the election. He accounts for four possible election results and five scenarios for statements regarding potential coalitions. The analysis uses cooperative game theory.     

Combining Rational Choice and Evolutionary Dynamics: The Indirect Evolutionary Approach

In this study we propose a formal framework for the indirect evolutionary approach initiated by Guth and Yaari. It allows us to endogenize preferences and to study their evolution. We define two‐player indirect evolutionary games with observable types and show how to incorporate symmetric as well as asymmetric situations. We show how to apply solution concepts that are well known from game theory and evolutionary game theory to solve these games. For illustration we include two examples.     

House prices and immovable property tax: Evidence from OECD countries

This paper studies the impact of changes in immovable property tax revenues on the growth rate of house prices by analysing a panel of 34 OECD countries over the period 1970–2014. Starting from the annual series of immovable property tax revenues, we isolate years of significant shifts in the property tax regime and study their impact on house prices. We find a strong negative relationship between increases in immovable property tax revenues and house prices. This relationship is robust to the inclusion of cyclical determinants of house prices, country and year fixed effects, and country‐specific linear trends. We also propose an instrumental variable strategy based on countries’ legal origins that confirms a statistically significant negative impact of such taxes in the short run.     

Pro-cyclicality beyond business cycle

We show that pro-cyclicality is inherent in risk measure estimates based on historical data. Taking the example of VaR, we show that the empirical VaR measure is mean-reverting over a 1-year horizon when the portfolio is held fixed. It means that a capital requirement rule based on historical measurements of VaR tends in calm times to understate future required capital and tends in volatile times to overstate it. To quantify this pro-cyclicality, we develop a simple and efficient methodology, which we apply to major equity market indices. We make the interesting point that the pro-cyclicality property holds true even in a world with constant volatility, though the empirical magnitude of the mean-reversion is greater than what would be observed in that special case.     

Bargaining Coalitions in the WTO Agricultural Negotiations

This paper aims to understand the structural features of bargaining coalitions in the Doha Round of the WTO. We provide an empirical assessment of the preferences of each negotiating actor considering general economics indicators, development levels, structure of agricultural sectors and trade policies. Bargaining coalitions are analysed by grouping countries using a cluster analysis procedure. The clusters are compared with existing coalitions in order to assess their degree of internal homogeneity as well as their common interests. Such a comparison allows the identification of possible ‘defectors’, i.e. countries that, according to their economic conditions and policies, seem to be relatively less committed to the positions of the coalition they join. In addition, the ex‐post analysis of the counterfactual coalitions sheds light on the ‘distance’ between different coalitions as well as between individual countries and the best alternative group available. Empirical results confirm our research hypothesis: clusters of structurally homogeneous countries well represent existing bargaining coalitions. In particular, the G‐20 shows a high degree of internal coherence, which, in our framework, may provide a clue to the ‘sustainability’ of this coalition and to its relevance in the Doha Round negotiations.     

The G20 at the Cancun Ministerial: Developing Countries and Their Evolving Coalitions in the WTO

In large measure, the voice that developing countries were able to exercise in Cancun was a result of their effective coalition formation. In this paper we present a brief overview of the various coalitions that played an important role at Cancun. The greater part of this paper focuses on one among these various coalitions: the G20 on agriculture. The G20 presents an especially fascinating case of a coalition that combined a great diversity of members and apparently incompatible interests. All theoretical reasoning and historical precedent predicted that the group would collapse in the endgame. And yet the group survived. We investigate the sources of the unity of this group and trace them to a process of learning that allowed the group to acquire certain structural features and develop strategies that helped to cement it further. While our central dependent variable is the cohesion of the G20, we also address the derivative question of the costs and benefits of maintaining such coalitions. The Cancun coalitions give us an excellent case of coalitions that managed to retain their cohesion, but also ended up with a situation of no agreement rather than a fulfilment of even some of their demands. We examine some of the causes behind the impasse in the negotiation process and suggest ways in which future outcomes could be improved.     

Measuring and forecasting mobile game app engagement

Monetization strategies in the large and strongly growing mobile app space must go beyond traditional purchase revenue as most mobile apps are now free to download. One key marketing innovation allows mobile app publishers to monetize ongoing engagement — in-app advertising.We study ongoing user engagement with a mobile app after the initial download decision using the $40 billion mobile gaming industry as an example. Our study investigates and forecasts user engagement after the initial download aiming to help publishers to monetize their engagement via in-app advertising. We leverage a novel dataset containing user-level engagement for 193 mobile games and propose a hierarchical Poisson model on a mobile-game level. We find significant usage heterogeneity across the mobile games studied and generate forecasts publishers can use when trying to monetize engagement via pre-sold contracts.     

Knowledge based resources, property based resources and supplier bargaining power in Hollywood motion picture projects

Supplier bargaining power is a factor that must be considered in resource based theories of dynamic capability. As competitors develop capabilities for dynamically changing resource configurations, they become more reliant on suppliers and allies. Because different types of supplier will have more or less bargaining power, some resource configurations will be more attractive to buyers. Hypotheses are developed and tested using data on star power, intellectual property, knowledge based resource quality, costs and revenues for 278 motion pictures released in the United States in 2000 and 2001. Suppliers appear to fully appropriate returns to knowledge and property based services, while buyers benefit from control of intellectual property and from the combination of intellectual property and talent behind the camera.     

产权与信用:博弈中的原初逻辑

产权是有限理性的自利的人们在长期的博弈过程中内生出来的结果。产权自我维持的私人治理说明信用的产生是尊重并保护产权的结果。从某种原初状态出发,在漫长的历史演化过程中,经济人在相互生存竞争和博弈过程中自发地形成了产权关系,这一过程中信用也相伴而生。事实和逻辑都证明了产权的确立是信用产生的前提,产权明晰对信用具有强化作用。     

Contracting in dynamic games

We study the bargaining problem in the dynamic framework. The classical way of solving a dynamic bargaining problem is to transform the extensive form game into the normal form and then apply the theory of bargaining well developed for normal form games. This means that the parties sign a binding contract in the beginning of the game which defines their actions for the full duration of the game. In this article, we consider the setting where the players monitor the contract as the game evolves. The main purpose of the article is to study conditions under which the players do not have a rationale to renegotiate a new contract at any intermediate time period; i.e., the contract is time consistent. Time consistency restricts the set of bargaining solutions in dynamic games. We will show that time consistency of the contract is guaranteed if the bargaining solution satisfies the controversial independence-of-irrelevant-alternatives property.     

Symmetric Coalitional Binomial Semivalues

We introduce here a family of mixed coalitional values. They extend the binomial semivalues to games endowed with a coalition structure, satisfy the property of symmetry in the quotient game and the quotient game property, generalize the symmetric coalitional Banzhaf value introduced by Alonso and Fiestras and link and merge the Shapley value and the binomial semivalues. A computational procedure in terms of the multilinear extension of the original game is also provided and an application to political science is sketched.     

Equilibrium investment with random risk aversion

We solve the problem of an investor who maximizes utility but faces random preferences. We propose a problem formulation based on expected certainty equivalents. We tackle the time-consistency issues arising from that formulation by applying the equilibrium theory approach. To this end, we provide the proper definitions and prove a rigorous verification theorem. We complete the calculations for the cases of power and exponential utility. For power utility, we illustrate in a numerical example that the equilibrium stock proportion is independent of wealth, but decreasing in time, which we also supplement by a theoretical discussion. For exponential utility, the usual constant absolute risk aversion is replaced by its expectation.     

Networks of innovators: Evidence from Canadian patents

Various forms of cooperative development have emerged in recent years, in response to increasing competitive pressures, development costs, and complexity. We use data on patents granted by the Canadian government between 1978 and 1989, in order to explore the formation of development coalitions, where two or more firms jointly develop and patent an innovation. Close to 2,600 firms have been involved in development coalitions. These coalitions can be mapped into more than 1,000 independent networks of innovators. The largest network interconnects 711 organizations.The prevalence of development coalitions varies considerably across nations. Two-thirds of the Japanese firms holding more than five patents are involved in at least one development coalition. This figure is less than 20% for Canadian and American firms, and 35% for German firms. Coalitions tend to be domestic rather than international. They also tend to be intra-sectorial, except in Japan where they are more frequently inter-sectorial. Our analysis indicates that Japanese development networks are very loose, just as they are for their American and European counterparts.This research has been supported by a grant of the FCAR. The author would like to thank the participants of the First International Conference on Joint-Ventures and Strategic Alliances (University Park) and two anonymous reviewers for their helpful comments.     

Nuclear Power

Nuclear power has never been free from the stifling involvement of government. Heavy regulation has reduced the ability of entrepreneurs to develop and provide new means for the generation of energy using nuclear fuel. The strict parameters dictated by government officials are based upon outdated technology, an improper regulatory philosophy, and preclude innovation in nuclear power generation. Anti-market environmentalists misunderstand the implications of a free market in nuclear power and argue against it based on problems that are actually caused by government involvement. Our position is neither for nor against nuclear power. We advocate a hands-off policy where the nuclear industry is left to its own devices, free from governmental regulations and subsidies: free to succeed or fail on its own. Thus, our position is neither right-wing conservative (removing regulations), nor left-wing liberal (removing subsidies). Very much to the contrary of both positions, we propose a free-market in nuclear power.     

The influence of ownership structure on internationalization

Common reasons mentioned for a firm's internationalization are related to advantages for the firm. However, if firms are conceptualized as political coalitions, this view does not seem to be sufficient to explain why and to what extent firms internationalize. A principal-agent theoretical approach focusing the ownership-stake-related motivations and bargaining power of owners plus the range of actions managers can employ in different ownership situations offers an alternative explanation. We consequently studied the influences of ownership structure – defined as the concentration of ownership – on a firm's degree of internationalization and the main regions of international diversification. Overall, we conclude that the relationship is non-linear. To test our hypotheses, we utilize panel data for the 102 largest German manufacturing firms from 1990 to 2006. The analysis confirms our assumptions.