Neighborhood structure and the evolution of cooperation

This paper deals with the problem of explaining the survival of cooperative behavior in populations in which each person interacts only with a small set of social ‘neighbors’, and individuals adjust their behavior over time by myopically imitating more successful strategies within their own neighborhood. We identify two parameters—the interaction radius and the benefit–cost ratio—which jointly determine whether or not cooperation can survive. For each value of the interaction radius, there exists a critical value of the benefit–cost ratio which serves as the threshold below which cooperation cannot be sustained. This threshold itself declines as the interaction radius rises, so there is a precise sense in which dense networks are more conducive to the evolution of cooperation.     

Education Dashboards for Enhanced Learning: A Singapore Experience

Educators continue to utilize add-ons, extensions, or replacements to traditional Learning Management Systems (LMSs) to supplement capabilities and improve the classroom experience. This work resulted in the design and development of the Education Dashboards for Enhanced Learning (EDEL) template. The EDEL template enables faculty members to create dynamic web spaces called Knowledge Portals (KPortals). A semester-long introduction of KPortals proved to be positive and useful. Students tended to view the KPortal as a “go-to” webspace. The authors hope to refine the template in future studies and examine its usefulness in other countries.     

Globalization and the Good Corporation: A Need for Proactive Co-existence

Large corporations are coming under intense pressure to act in a socially responsible manner. Corporations have accepted this notion provided that it is exercised voluntarily. It has also been argued that corporations can do well by doing good, and that good ethics is good business. This paper presents an alternative viewpoint by demonstrating that while voluntary socially responsible conduct is desirable, it plays a rather small role in inspiring good corporate conduct. Instead, (a) it is the external economic-competitive conditions that define the parameters and opportunities for good corporate conduct; and (b) the values and traditions of the corporations, and their perceived risk in exploiting those opportunities, that influence the extent of a corporation's socially responsible conduct. The framework presented here analyzes certain market-competitive conditions, which determine the scope and direction of socially responsible corporate conduct, and the instruments available to society to enhance ethical corporate conduct. It suggests that from society's perspective, we should move away from the notion of corporate social responsibility and toward corporate social accountability. Most modern economies operate under conditions of imperfect competition where corporations gain above-normal profits, i.e., market rent, from market imperfections. Therefore, corporations should be held accountable for a more equitable distribution of these above-normal profits with other groups, e.g., customers, employees, etc., who were deprived of their market-based gains because of market imperfections and corporate power. Three approaches are suggested for measuring corporate accountability through corrections. These are: information imbalance, bargaining power imbalance, and, adjudication, remedy and relief imbalance.     

Freeport-McMoRan Copper &; Gold,Inc.: An Innovative Voluntary Code of Conduct to Protect Human Rights,Create Employment Opportunities,and Economic Development of the Indigenous People

Environmental degradation and extractive industry are inextricably linked, and the industry’s adverse impact on air, water, and ground resources has been exacerbated with increased demand for raw materials and their location in some of the more environmentally fragile areas of the world. Historically, companies have managed to control calls for regulation and improved, i.e., more expensive, mining technologies by (a) their importance in economic growth and job creation or (b) through adroit use of their economic power and bargaining leverage against weak national governments, regional and international regulatory bodies. More recently, the industry has had to contend with another set of challenges that involved treatment of indigenous people and their traditional land rights, fair treatment of workers, human rights abuses, and bribery and corruption involving local officials and political leaders. These challenges currently fall outside the traditional areas of regulation and control. Nevertheless, they pose serious threat to the industry’s business practices because of their global scope, threat to company’s reputation, and long-term risks of political instability leading to increasing cost of capital. Industry has responded to these challenges by creating voluntary codes of conduct that would signify their intent to comply with higher standards of conduct, and assuage public opinion that no further action is called for. These codes, however, lack any monitoring mechanism and reporting integrity to assure the public that the industry members are indeed meeting their commitments. Consequently, pressure on the industry continues unabated and with ever increasing calls for mandatory regulation and oversight. This article examines the activities of one mining company, Freeport-McMoRan Copper & Gold, Inc., which has taken a radically different approach in responding to these challenges at its mining operations in West Papua, Indonesia. While cooperating with industry-based efforts of voluntary codes of conduct, Freeport also initiated a radically different response through its own voluntary code that would directly focus on issues of human rights, treatment of indigenous people on whose traditional land its mine was located; economic development and job creation and, improvements in health, education, and housing facilities, to name a few. Additionally, the company earmarked large sums of money and involved representatives of the indigenous people in their management and disbursement. The company took an even more radical action when it committed itself to independent external audits of the company’s compliance with the code, and that these findings and company’s responses would be made public without prior censorship by the company. We analyze the nature of corporate culture, vision and risk-taking propensities of its management that would impel the company to embark on a high risk strategy whose outcomes could not be predicted with any degree of certainty before the fact. The parent company also had to confront discontent among the management ranks at the mine site because of cultural differences and management styles of expatriates and local (Indonesian) managers. Finally, we discuss in some detail the extensive and intensive character of a two phase audit conducted by the outside monitors, their findings, and the process by which they were implemented and reported to general public. We also evaluate the strengths and challenges posed by such audits, their importance to the company’s future, and how such projects might be undertaken by other companies.     

A Stochastic Extension of the Miller-Modigliani Framework1

This paper deals with the problem of the financial valuation of a firm and its shares of stock with general financing policies in a partial equilibrium framework. the model assumes a time-dependent discount rate and a general stochastic environment in a discrete-time setting. the fundamental valuation approach under the assumption of risk neutrality is used to obtain the time path of share price, the number of outstanding shares, and the value of the firm. These are shown to be the unique conditional expectations of certain stochastic processes. A broad class of firms for which the solution formula yields finite-valued solutions is characterized. the results are extended to the non-risk-neutral case. A regularity condition, which is both necessary and sufficient for the share price to equal the capitalization of future dividends accruing to the share, is obtained. As a mathematical aside, it is shown in the appendix that in the absence of this condition, the so-called stream of dividends approach is meaningless in the sense that it does not yield any financial valuation.     

Efficiency and stability of sampling equilibrium in public goods games

Most models of social preferences and bounded rationality that are effective in explaining efficiency‐increasing departures from equilibrium behavior cannot easily account for similar deviations when they are efficiency‐reducing. We show that the notion of sampling equilibrium, subject to a suitable stability refinement, can account for behavior in both efficiency‐enhancing and efficiency‐reducing conditions. In particular, in public goods games with dominant strategy equilibria, stable sampling equilibrium can involve the play of dominated strategies with positive probability both when such behavior increases aggregate payoffs (relative to the standard prediction) and when it reduces aggregate payoffs. The dominant strategy equilibrium prediction changes abruptly from zero contribution to full contribution as a parameter crosses a threshold, whereas the stable sampling equilibrium remains fully mixed throughout. This is consistent with the available experimental evidence.     

Strategy-Specific Barriers to Learning and Nonmonotonic Selection Dynamics

The replicator dynamics are generalized to allow for strategy-specific barriers to learning. The resulting dynamics satisfy neither payoff monotonicity nor payoff positivity, but do satisfy weak payoff positivity. It is shown that initial states from which trajectories converge to a rest point under the replicator dynamics may yield trajectories which approach a stable limit cycle under the generalized replicator dynamics. Furthermore, strategies which are strictly dominated by other pure strategies may survive indefinitely along such nonconvergent paths.Journal of Economic LiteratureClassification Numbers: C73.     

Celebrity endorsement: How celebrity–brand–user personality congruence affects brand attitude and purchase intention

The present study provides and tests a conceptual framework aimed at comparing the relative effectiveness of celebrity–user, brand–celebrity, and user–brand personality congruence on brand attitude and brand purchase intention (BPI) thereafter. The data collection was done via an online survey of a representative group of consumers (n = 431) located across India. Hypotheses were tested using regression analysis with mediation approach. The results indicate that while user–brand and brand–celebrity personality congruence have a significant impact on brand attitude and purchase intention, celebrity–user congruence does not. Further, brand attitude is found to be a partial mediator on the relationship between the pair-wise personality congruence on BPI. The findings have major implications for marketers in understanding the significance of personality congruence among celebrity–brand–user in the formation of brand attitude and purchase intention that can be used in positioning and in increasing the advertising effectiveness of brands using celebrity endorsement. The present study is a pioneer in contributing to the celebrity endorsement literature by investigating the relative impact of three pairs of personality congruence: celebrity–brand, brand–user, and celebrity–user, on brand attitude and BPI, thereby supporting the applicability of McCracken's Meaning Transfer Model [McCracken (1989), The Journal of Consumer Research, 16 (3) 310–321) and the Hierarchy-of-effects model (Lavidge and Steiner (1961), Journal of Marketing, 25 (6) 59–62].     

Injuries,inequalities and health in Europe

Injuries account for a significant burden of mortality, morbidity, disability and health care costs. They differentially affect age and sex groups and reveal massive inequalities in occurrence within and between countries in Europe. Within countries, the poor suffer most and have least ability to change their exposures to risk. Addressing inequalities in injury occurrence would play a valuable role in reducing the differential burden of ill-health between rich and poor. Despite the evidence for many effective injury-related interventions, limited attention has been devoted to addressing injuries as a public health priority. This paper questions why attention has been limited to date and suggests policy action to support injuries being addressed as a mainstream concern by national and international health policy-makers. The paper briefly highlights the public health burden of injuries and violence; illustrates the range of inequalities that characterise their occurrence; highlights the scope for public health action and considers the extent to which policies that reduce the overall burden of injuries may also reduce inequalities in their occurrence; and finally examines why there has been a limited policy response to date and suggests ways of advancing the agenda.     

OPTIMAL CONSUMPTION AND PORTFOLIO DECISIONS WITH PARTIALLY OBSERVED REAL PRICES

We consider optimal consumption and portfolio investment problems of an investor who is interested in maximizing his utilities from consumption and terminal wealth subject to a random inflation in the consumption basket price over time. We consider two cases: (i) when the investor observes the basket price and (ii) when he receives only noisy observations on the basket price. We derive the optimal policies and show that a modified Mutual Fund Theorem consisting of three funds holds in both cases. The compositions of the funds in the two cases are the same, but in general the investor's allocations of his wealth into these funds will differ. However, in the particular case when the investor has constant relative risk-aversion (CRRA) utility, his optimal investment allocations into these funds are also the same in both cases.