A de Finetti-Kolmogoroff-Nagumo type integral representation theorem for generalized means on masses

We point out that the Consistency, Continuity and Associativity properties of an extended realvalued functionalm on masses are the basic notions to get a de Finetti-Kolmogoroff-Nagumo type integral representation ofm.

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Riassunto Come è noto il teorema di de Finetti-Kolmogoroff-Nagumo formisce una rappresentazione integrale di particolari funzionali reali, detti medie, definiti per funzioni di ripartizione che distribuiscono l'intera massa su un prefissato intervallo chiuso e limitato dell'asse reale.Nel lavoro [2] gli autori hanno esteso la nozionc di media, considerata ancora come funzionale reale, dalle funzioni di ripartizione alle masse (misure finitamente additive limitate e non negative). In questo modo, estendendo ad essa le usuali proprictà (internalità, associatività, etc.), sono riusciti a provare un teorema di rappresentazione integrale analogo a quello di de Finctti-Kolmogoroff-Nagumo per medie continue ed associative definite su opportuni insiemi di masse tight (cio prive di masse aderenti a – e+).In questo lavoro, naturale prosccuzione del preccedente, si prendono invecc in considerazione medic generalizzate (cioè medie che possono assumere valori reali oppure anche i valori – c+) e masse non neccssariamente tight. Si fa allora vedere che le nozioni di consistenza, continuità e associatività per un funzionale a valori nella retta compatta e definito sulle masse non nulle, sono condizioni caratteristiche per ottencre una sua rappresentazione integrale del tipo de Finctti-Kolmogoroff-Nagumo. Si prova inoltre che, a differenza della media ariumetica, le medic generalizzate continue ed associative possono assumere valori non reali solamente su opportune masse non tight.

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Work performed under the auspices of the National Group for Sthocastic Models and Mathematical Statistics (M.R.S.T. 40%) and G.N.A.F.A. of C.N.R.     

Representing complete and incomplete subjective linear preferences on random numbers

We show that preferences on random numbers which satisfy certain natural properties can be represented, in the setting of topological vector spaces, by a suitable family of continuous previsions which is, in a sense, unique. Moreover, for most commonly used spaces of random numbers, we establish that one can derive these preferences, via an expectation operator, from a suitable family of probabilities (whether or not finitely additive). Mathematics Subject Classification (2000): 06A06, 62C05, 91B06 Journal of Economic Literature Classification: D11, D81     

Issues arising for accounting harmonization: The case of stock options in Italy

In Italy, national generally accepted accounting principles (GAAP) and International Financial Reporting Standards (IFRS) regulations coexist, despite differences that lead to their antagonist forms of accounting relativism. In this context, the two accounting systems provide for different representations of stock options plans, with significant effects on year-end income measures. This study therefore considers the emblematic case of stock options with the goal of demonstrating, on the basis of the dominant accounting principles and conventional wisdom in Italy, that the aforementioned difference cannot be explained by reasons connected with the accounting conceptual framework of reference in each system. Rather, inquiries should focus on weaknesses in national GAAP.     

The Invisible Side of Political Parties: The Case of the PCdoB

The young Latin American democracies have been structuring their political parties for day-to-day management. In this context, it is important to understand how such structures could be affected by the so-called invisible side of organizations, which are composed of networks of relationships between elected politicians and then relationships between these and external militant groups, which can greatly influence the candidates’ performance and the very dynamics of the party. This article seeks to unravel some of these dimensions. We select for analysis the case of the PCdoB (Communist Party of Brazil), in the Metropolitan Region of Belo Horizonte, state of Minas Gerais, Brazil. The results show the nature of the embeddedness of these actors in the political system, highlighting weaknesses and possibilities.     

A remark on failures of conglomerability of prevision

Given a coherent conditional prevision we obtain, by means of the Yosida-Hewitt Decomposition Theorem, an upper bound of its failures of conglomerability with respect to a random number and a denumerable partition. In this way we get an extension of Theorem 2.3 of [4] to coherent previsions.

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Riassunto Considerata una previsione subordinata coerente si fornisce, tramite il teorema di decomposizione di Yosida-Hewitt, una maggiorazione degli errori di conglomerabilità relativi ad un numero aleatorio e ad una partizione numerabile. Viene così esteso alle previsioni coerenti il teorema 2.3 di [4].

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Work performed under the auspices of the National Group for Stochastic Models (Ministero della Pubblica Istruzione, 40%).     

Systemic financial risk indicators and securitised assets: an agent-based framework

The paper presents an agent-based model of a credit economy which includes a securitisation process and a bailout mechanism for bank bankruptcies. Within this framework, banks are able to sell mortgages to a financial vehicle corporation, which finances its activity by creating mortgage-backed securities and selling them to a mutual fund. In turn, the mutual fund collects liquidity by selling shares to households and remunerates them with a monthly interest. The impact of this mechanism is analysed by means of computational experiments for different levels of banks’ securitisation propensity. Furthermore, we study a set of systemic risk indicators which have the aim of assessing the imbalances in the financial system. Two of them are the mortgage-to-GDP ratio and the capital adequacy ratio, which are constructed to detect only the on-balance sheet changes in banks’ credit exposure. We consider two additional indicators, similar to the previous ones with the only difference that they are also able to account for the off-balance sheet items. Moreover, we adopt an indicator, the so-called “virtuous–unvirtuous cycle” indicator, which, besides off-balance assets, targets also the GDP. The results show that higher securitisation propensity weakens the financial stability of banks with relevant effects on different sectors of the economy. Most importantly, the analysis of systemic risk reveals the important issue of designing suitable systemic risk indicators for predicting incoming financial crises, finding that an essential feature of these indicators should be to integrate banks’ off-balance sheet assets.

     

Macroeconomic implications of mortgage loan requirements: an agent-based approach

It is a well-known fact that the housing market, with its associated mortgage securities, plays a crucial role in modern economies. The recent crisis of 2007, triggered by the U.S. real estate bubble, confirms this key role and suggests the importance of regulating mortgage lending. This paper investigates these issues by designing a housing market with a linked mortgage lending instrument in the Eurace agent-based model. Our results show that the presence of a housing market in the model has relevant macroeconomic implications, driven mainly by the additional amount of endogenous money injected into the economy by new mortgages. This additional money generally helps to support and stabilize aggregated demand, thus improving the main economic indicators. However, if the regulation of mortgage lending is too lax, involving an increase in the debt-service-to-income ratio (DSTI), then the additional supply of mortgages no longer enhances macroeconomic performance, and the stability of the economic system is undermined. Based on a number of recent discussions, a regulation of stock control that targets households’ net wealth (a stock), rather than income (a flow) is designed and analyzed. The results show that regulation of stock control can be combined effectively with DSTI to increase the stability of the housing market and the economy as a whole. Interestingly, the regulation based on stock control also directly affects mortgage distribution among households, avoiding excessive concentration. From a policy perspective, our results suggest that the use of a mild flow control regulation, coupled with a stricter stock control measure, fosters sustainable growth and eases first-time buyers access to the housing market, encouraging homeownership.

     

Crowdfunding as a tool to support sustainability‐oriented initiatives: Preliminary insights into the role of product/service attributes

A common goal of current research seems to uncover whether crowdfunding (CF) could be considered an effective way to support sustainability‐oriented initiatives in securing funding, due to diverging results emerging from literature. We claim that the objective of proving whether CF may benefit sustainability‐oriented initiatives could be misplaced; rather, we deem more fruitful to understand how critical are some attributes of products/services pursued within CF campaigns to benefiting sustainability‐oriented initiatives and increasing their odds of success in CF. We focus on food‐related projects as in this sector, sustainability issues apply more than to any other human activities and construct a unique sample of food CF campaigns launched and ended in the European Economic Area countries on the world's most popular reward‐based CF platform, that is, Kickstarter. We identify campaigns with a sustainability orientation and perform an in‐depth qualitative analysis, which allows us to classify them into meaningful clusters and subclusters. Our research suggests that the emphasis on egoistic/self‐centered product attributes, rather than on altruistic/society‐centered attributes, is generally more crucial to facilitate CF support to sustainability‐oriented projects. However, the emphasis on altruistic/society‐centered attributes emerges to be more beneficial for initiatives specifically supporting local products. Our results also suggest that reward‐based CF is not suitable for sustainability‐oriented projects targeting disadvantaged individuals/groups. These results offer both theoretical and empirical contributions to the literature as well as practical implications.