Revenue sharing in network utility maximization problems

Alliances arise in a wide variety of domains, when a group of countries, political parties, people or other entities agree to work together because of shared interests or aims. They make sense, if the output obtained is somehow better than the outcome of acting individually. Revenue or cost sharing is key when determining if individuals are better off by contributing to an alliance or not. In our alliance each member owns a unique resource –or set of resources–, which is given to the alliance. The alliance sells services, which are supported thanks to one or a set of these resources. We focus on alliances that sell services in such a way that the total revenue of the alliance is maximized. We show that this kind of problems can be modeled through a Network Utility Maximization problem. We subsequently explore the problem of revenue sharing among the members of the alliance. Such a problem is a complex one since the interests of all participants must be ensured and correct incentives must be provided. We formally formulate the members’ interests through a set of properties the revenue sharing method should verify. We then discuss the existing methods for revenue sharing and conclude that none of them verifies the needed properties for the case of a revenue maximizing alliance. We finally propose a revenue sharing method based on projecting the contributions of each member of the alliance into an economic stable set. Through an exhaustive simulative study we conclude that our method provides, in addition to economic stability, fairness among members and the right incentives to them. Through our analysis Network Service Provider alliances, which sell quality-assured data transport services, are considered as an application example.     

Learning from Greek Philosophers: The Foundations and Structural Conditions of Ethical Training in Business Schools

There is an extensive body of work that has previously examined the teaching of ethics in business schools whereby it is hoped that the values and behaviours of students might be provoked to show positive and enduring change. Rather than dealing with the content issues of particular business ethics courses per se, this article explores the philosophical foundations and the structural conditions for developing ethical training programs in business schools. It is informed by historical analysis, specifically, an examination of Platonic and Aristotelian philosophies that inspires virtue ethics, and together provides four conditions for consideration: respect for law, dialectics, imitation and deliberation. We outline the necessary structural conditions for implementing these requirements as well as suggesting the necessary pedagogical protocol applicable to all courses. It is argued that reference to our two ancient Greek philosophers provide many valuable and insightful lessons for the implementation of ethical training today including choice of theoretical content and the approach towards learning. Further, the enactment of a pedagogical protocol requires a policy of recruiting and managing business school teachers-instructors that takes into account, and consciously encourages, intellectual, relational and spiritual pedagogical qualities.     

Do environmental attitudes and food technology neophobia affect perceptions of the benefits of nanotechnology?

In recent years, a significant amount of research has focussed on the analysis of consumers' aversion to new technologies in food production and processing. At the same time, research has shown that environmental attitudes may be related to purchasing behaviour of consumers. This paper presents the result of an investigation into Canadian attitudes towards nanotechnology, in general, and in applications in the food industry. The relationship between the food technology neophobia scale, environmental attitudes and nanotechnology is examined. The results suggest that food technology neophobia is significant in explaining attitudes towards nanotechnology, in general, and for food packaging and foods. Environmental attitudes are important in explaining respondents' attitudes towards nanotechnology in general but not in explaining attitudes towards nanotechnology in food packaging or food applications. Survey respondents' views of the role of science and technology in society (makes society worse or better off) are a more important determinant of attitudes towards nanotechnology than whether they had heard of nanotechnology prior to the survey.     

The Impact and Determinants of Nine-Ending Pricing in Grocery Retailing

Research into nine-ending pricing indicates a clear effect on sales but strong variance, suggesting that their effects are context dependent. This research relates nine-ending effects to a broad set of determinants and investigates the influence of brand, category, store, and store area clientele characteristics. The numerous empirically supported hypotheses indicate that the framework built on level and image effects is well adapted for explaining the effectiveness of nine-endings. They validate that a wide and indiscriminate practice of nine-ending pricing is not effective. The findings show that the impact of nine-endings can lead to sales losses (e.g., premium brands); however, a nine-ending price is more effective for increasing sales of small brands (e.g., low market-share, low price, and new items) that belong to weaker categories (e.g., low price, low budget-share). The effect erodes as the store's nine-ending pricing practices intensify. For category sales, a simulation reveals the existence of a threshold for which overuse is counterproductive.     

Tax policies and agency costs

We show that when large corporations are subject to a different tax system than smaller firms, the agency cost of under- and overinvestment is significantly altered. In contrast to the findings in the literature, the gap between the first- and second-best investment trigger prices do not move in lockstep with variations in the corporate tax rate, as in the case of a linear tax system. We show that the gap can either widen or shrink, depending on the tax policy design and regime. In addition, we find that the agency cost under a progressive tax regime is considerably larger than the agency cost under a regressive tax regime when equityholders have to bear all the investment costs. These results are reversed when managers have the ability to issue additional debt to finance the firm's expansion and transfer part of the investment costs to bondholders.     

Rock around the clock: An agent-based model of low- and high-frequency trading

We build an agent-based model to study how the interplay between low- and high-frequency trading affects asset price dynamics. Our main goal is to investigate whether high-frequency trading exacerbates market volatility and generates flash crashes. In the model, low-frequency agents adopt trading rules based on chronological time and can switch between fundamentalist and chartist strategies. By contrast, high-frequency traders activation is event-driven and depends on price fluctuations. High-frequency traders use directional strategies to exploit market information produced by low-frequency traders. Monte-Carlo simulations reveal that the model replicates the main stylized facts of financial markets. Furthermore, we find that the presence of high-frequency traders increases market volatility and plays a fundamental role in the generation of flash crashes. The emergence of flash crashes is explained by two salient characteristics of high-frequency traders, i.e., their ability to i. generate high bid-ask spreads and ii. synchronize on the sell side of the limit order book. Finally, we find that higher rates of order cancellation by high-frequency traders increase the incidence of flash crashes but reduce their duration.     

Coordination Costs and the Geography of Production

In a model à la Venables of 1996 Venables, A. J. (1996) Equilibrium locations of vertically linked industries, International Economic review, 37, 341–359. doi: 10.2307/2527327[Crossref], [Web of Science ®] , [Google Scholar], we distinguish two kinds of intermediate goods: complex goods that entail endogenous coordination costs, and simple goods that do not. Coordination costs depend on geographical distance and the number of intermediate goods used in the production process. In the final stage of integration, there are two possible spatial configurations: (1) a symmetric configuration and (2) a partial core–periphery equilibrium, comprised of a core region that produces the final and complex intermediate goods, and a periphery that produces simple intermediate goods. We discuss some policy implications of this multiple-equilibria outcome.

Les coûts de coordination et la géographie de la production     

Does Health Information Matter for Modifying Consumption? A Field Experiment Measuring the Impact of Risk Information on Fish Consumption

A field experiment was conducted in France to evaluate the impact of health information on fish consumption. A warning revealed the risks of methyl mercury contamination in fish and gave consumption recommendations. A difference-in-differences estimation shows that this warning led to a statistically significant but relatively weak decrease in fish consumption. Consumption of the most contaminated fish did not decrease despite advice to avoid consumption of these fish. Accompanying questionnaires show that consumers imperfectly recall the fish species quoted in the warning. The results suggest a relatively poor efficacy of a complex health message, despite its use by several national health agencies.     

Futures studies and public decision in Sweden

Futures studies are a decisive part of the public decision process in Sweden, where they appeared after World War II and gained momentum from the 1970s on.Based on a series of interviews conducted in Stockholm in December 2003, this paper presents the main players involved in futures studies in Sweden. It focuses especially on the activities of the Institute for Futures Studies, and that of the Lindbeck Commission on the Future of Sweden, which was a resounding success.The paper gives a detailed account of the interplay between this various actors. There is a strong independence between the public decision making system and the producers of futures studies. Nevertheless, futures studies prove an important instrument for public policy in Sweden, as they raise awareness in the public debate, serve as a tool for consultation, and help define scientific and technological priorities.