Governance choice on a serial network

This paper analyzes governance choice in a two-level federation in providing road infrastructure across jurisdictions. Two models are proposed to predict the choice of centralized or decentralized spending structure on a serial road network shared by two districts. While the first model considers simple Pigouvian behavior of governments, the second explicitly models political forces at both a local and central level. Both models led to the conclusions that the spending structure is chosen based on a satisfactory comprise between benefits and costs associated with alternative decision-making processes, and that governance choice may spontaneously shift as the infrastructure improves temporally.Governance choice · Transportation · Infrastructure · Fiscal federalism

Technological Innovations and Endogenous Changes in U.S. Legal Institutions, 1790-1920

Recent scholarship highlights the importance of institutions to the processes of economic growth, but the precise nature of their relationship bears further examination. This paper considers how the evolution of legal institutions has contributed to, and in turn been affected by, major technological innovations. The first section of the paper examines the U.S. intellectual property system. Patent and copyright laws, and their interpretation and enforcement by the federal judiciary, certainly influenced the course of technical and cultural change, but it is clear that they did not develop independently of the state of technology and of the economy. Both the statutes and their interpretations altered in response to the introduction and diffusion of new technologies. The second section explores in more detail the impact of some of these technological innovations -- including steamboats, railroads, telegraphy, medical technologies, and automobiles -- on the common law, regulation and insurance. Such technological advances often led to institutional bottlenecks, which then required accommodations in legal rules and their enforcement. Although the common law had some capability for economizing on legal adjustment costs through 'adjudication by analogy', the socio-economic changes wrought by major innovations ultimately produced more fundamental change in legal institutions, such as shifts in the relative importance of state and federal policies, and in the degree of reliance on regulation by bureaucracy. In sum, the historical record of the evolution of legal rules and standards in the United States indicates a remarkable degree of flexibility as such institutions responded to changing economic circumstances.

Robust Portfolios and Weak Incentives in Long-Run Investments

When the planning horizon is long, and the safe asset grows indefinitely, isoelastic portfolios are nearly optimal for investors who are close to isoelastic for high wealth, and not too risk averse for low wealth. We prove this result in a general arbitrage-free, frictionless, semimartingale model. As a consequence, optimal portfolios are robust to the perturbations in preferences induced by common option compensation schemes, and such incentives are weaker when their horizon is longer. Robust option incentives are possible, but require several, arbitrarily large exercise prices, and are not always convex

Constitutional Limits on Private Policing and the State’s Allocation of Force

This Note argues that a variety of private police forces, such as university patrols and residential security guards, should. be held to the constitutional limitations found in the Bill of Rights. These private police act as arms of the state by supplying force in response to a public demand for order and security. The state, as sovereign, retains responsibility to allocate force, in the form of either public or private police, in response to public demand. This state responsibility-a facet of its police power-is evidenced throughout English and American history. When this force responds to a public demand for order and security, existing state action doctrine case law places both public and private force tinder constitutional scrutiny

Structure Exploitation in Mixed-Integer Optimization with Applications to Energy Systems

Das Ziel dieser Arbeit ist neue numerische Methoden für gemischt-ganzzahlige Optimierungsprobleme zu entwickeln um eine verbesserte Geschwindigkeit und Skalierbarkeit zu erreichen. Dies erfolgt durch Ausnutzung gängiger Problemstrukturen wie separierbarkeit oder Turnpike-eigenschaften. Methoden, die diese Strukturen ausnutzen können, wurden bereits im Bereich der verteilten Optimierung und optimalen Steuerung entwickelt, sie sind jedoch nicht direkt auf gemischt-ganztägige Probleme anwendbar. Um verteilte Rechenressourcen zur Lösung von gemischt-ganzzahligen Problemen nutzen zu können, sind neue Methoden erforderlich. Zu diesem Zweck werden verschiedene Erweiterungen bestehender Methoden sowie neuartige Techniken zur gemischt-ganzzahligen Optimierung vorgestellt. Benchmark-Probleme aus Strom- und Energiesystemen werden verwendet, um zu demonstrieren, dass die vorgestellten Methoden zu schnelleren Laufzeiten führen und die Lösung großer Probleme ermöglichen, die sonst nicht zentral gelöst werden können. Die vorliegende Arbeit enthält die folgenden Beiträge: - Eine Erweiterung des Augmented Lagrangian Alternating Direction Inexact Newton-Algorithmus zur verteilten Optimierung für gemischt-ganzzahlige Probleme. - Ein neuer, teilweise-verteilter Optimierungsalgorithmus für die gemischt-ganzzahlige Optimierung basierend auf äußeren Approximationsverfahren. - Ein neuer Optimierungsalgorithmus für die verteilte gemischt-ganzzahlige Optimierung, der auf branch-and-bound Verfahren basiert. - Eine erste Untersuchung von Turnpike-Eigenschaften bei Optimalsteuerungsproblemen mit gemischten-Ganzzahligen Entscheidungsgrößen und ein spezieller Algorithmus zur Lösung dieser Probleme. - Eine neue Branch-and-Bound Heuristik, die a priori Probleminformationen effizienter nutzt als aktuelle Warmstarttechniken. Schließlich wird gezeigt, dass die Ergebnisse der vorgestellten Optimierungsalgorithmen für verteilte gemischt-ganzzahlige Optimierung stark Partitionierungsabhängig sind. Zu diesem Zweck wird auch eine Untersuchung von Partitionierungsmethoden für die verteilte Optimierung vorgestellt

Special, Vestigial, or Visionary? What Banking Regulation Tells Us About the Corporation—and Vice Versa

A remarkable yet seldom noted set of parallels exists between modern U.S. bank regulation, on the one hand, and what used to be garden-variety American corporate law, on the other hand. For example, just as bank charters are matters not of right but of conditional privilege even today, so were all corporate charters not long ago. Just as chartered banks are authorized to engage only in limited, enumerated activities even today, so were all corporations restricted not long ago. And just as banks are subject to strict capital regulation even today, so were all corporations not long ago. In this Symposium Article, we argue that these parallels are not merely curious accidents but a reflection of certain foundational dynamics embedded in, and constitutive of, the corporate form itself. Tracing the history of the incorporated American firm, we argue that the corporation is an inherently hybrid public–private entity—an institutionalized and conditional outsourcing to private parties of certain essentially public powers and functions. In effect, it is a form of public–private “franchise” arrangement in which the public is the franchisor and private parties collectively serve as the franchisees. We examine the reasons both for the gradual weakening of this original franchise arrangement as a matter of American corporate law and policy, and for its continuing presence as a matter of bank regulation. We suggest that the “special” salience of banks’ role as public franchisees helps to account for the resilience of the original corporate settlement in U.S. bank regulation. Finally, we consider the normative and practical implications of reviving the “forgotten” franchise view of the corporation more generally and, in the spirit of intellectual experiment, tentatively outline some possibilities for reintroducing public interest-driven conditions in state grants of corporate privilege

Special, Vestigial, or Visionary? What Banking Regulation Tells Us About the Corporation—and Vice Versa

A remarkable yet seldom noted set of parallels exists between modern U.S. bank regulation, on the one hand, and what used to be garden-variety American corporate law, on the other hand. For example, just as bank charters are matters not of right but of conditional privilege even today, so were all corporate charters not long ago. Just as chartered banks are authorized to engage only in limited, enumerated activities even today, so were all corporations restricted not long ago. And just as banks are subject to strict capital regulation even today, so were all corporations not long ago. In this Symposium Article, we argue that these parallels are not merely curious accidents but a reflection of certain foundational dynamics embedded in, and constitutive of, the corporate form itself. Tracing the history of the incorporated American firm, we argue that the corporation is an inherently hybrid public–private entity—an institutionalized and conditional outsourcing to private parties of certain essentially public powers and functions. In effect, it is a form of public–private “franchise” arrangement in which the public is the franchisor and private parties collectively serve as the franchisees. We examine the reasons both for the gradual weakening of this original franchise arrangement as a matter of American corporate law and policy, and for its continuing presence as a matter of bank regulation. We suggest that the “special” salience of banks’ role as public franchisees helps to account for the resilience of the original corporate settlement in U.S. bank regulation. Finally, we consider the normative and practical implications of reviving the “forgotten” franchise view of the corporation more generally and, in the spirit of intellectual experiment, tentatively outline some possibilities for reintroducing public interest-driven conditions in state grants of corporate privilege

Large time behavior of solutions to semi-linear equations with quadratic growth in the gradient

This paper studies the large time behavior of solutions to semi-linear Cauchy problems with quadratic nonlinearity in gradients. The Cauchy problem considered has a general state space and may degenerate on the boundary of the state space. Two types of large time behavior are obtained: i) pointwise convergence of the solution and its gradient; ii) convergence of solutions to associated backward stochastic di�erential equations. When the state space is Rd or the space of positive de�nite matrices, both types of convergence are obtained under growth conditions on coe�cients. These large time convergence results have direct applications in risk sensitive control and long term portfolio choice problems