Financial Crisis, Economic Recovery and Banking Development in Former Soviet Union Economies

This paper provides a unified theory to explain the onset of the financial crisis in 1998 and the striking economic recovery in Russia and the former Soviet Union afterwards. Before the crisis, the banking sector in these economies was stuck in a development trap in which the banking sector is separated from the real sector of the economy. The separation between the two sectors arises due to a lemons lending market and due to a large government budget. In a lemons credit market firms may find it cheaper to raise liquidity through non-bank finance (trade credits from other firms) rather than through bank finance. As a result non-bank finance may generate an externality on the lending rates of banks. In equilibrium most firms in the economy rely on non-bank finance and the financial sector focuses on trading government securities. The collapse of the treasury bills market in Russia in the financial crisis of 1998 reversed this process and thus acted as a trigger to pull the economy out of the trap. This has led to the strong economic recovery and provided initial conditions for banking development. Empirical evidence with firm level data from Ukraine in 1997 and with country level data for transition economies support the model’s predictions.banking development ; institutional trap ; trade credit ; nonbank finance ; finance in emerging market economies

Financial Crisis, Economic Recovery, and Banking Development in Russia, and other FSU Countries

This paper provides a unified analysis for the onset of the 1998 financial crisis and the strong economic recovery afterward in Russia and other former Soviet Union countries. Before the crisis a banking failure arose owing to the coexistence of a lemons credit market and high government borrowing. In a lemons credit market low credit risk firms switched from bank to nonbank finance, including trade credits and barter trade, generating an externality on banks’ interest rates. The collapse of the treasury bills market in the financial crisis triggered a change in banks’ lending behavior, providing initial conditions for banking development.banking development; institutional trap; financial crisis

Network models of innovation and knowledge diffusion

Much of modern micro-economics is built from the starting point of the perfectly competitive market. In this model there are an infinite number of agents — buyers and sellers, none of whom has the power to influence the price by his actions. The good is well-defined, indeed it is perfectly standardized. And any interactions agents have is mediated by the market. That is, all transactions are anonymous, in the sense that the identities of buyer and seller are unimportant. Effectively, the seller sells “to the market” and the buyer buys “from the market”. This follows from the standardization of the good, and the fact that the market imposes a very strong discipline on prices. Implicit here is one (or both) of two assumptions. Either all agents are identical in every relevant respect, apart, possibly, from the prices they ask or offer; or every agent knows every relevant detail about every other agent. If the former, then obviously my only concern as a buyer is the prices asked by the population of sellers since in every other way they are identical. If the latter, then each seller has a unique good, and again what I am concerned with is the price of it. In either case, we see that prices capture all relevant information and are enough for every agent to make all the decisions he needs to make....economics of technology ;

Financial crisis, economic recovery, and banking development in Russia, Ukraine, and other FSU countries

This paper provides a unified analysis for the onset of the 1998 financial crisis and the strong economic recovery afterward in Russia and other former Soviet Union countries. Before the crisis a banking failure arose owing to the coexistence of a lemons credit market and high government borrowing. In a lemons credit market low credit risk firms switched from bank to nonbank finance, including trade credits and barter trade, generating an externality on banks’ interest rates. The collapse of the treasury bills market in the financial crisis triggered a change in banks’ lending behavior, providing initial conditions for banking development.published_or_final_versio

Multi-Agent Systems

This Special Issue ""Multi-Agent Systems"" gathers original research articles reporting results on the steadily growing area of agent-oriented computing and multi-agent systems technologies. After more than 20 years of academic research on multi-agent systems (MASs), in fact, agent-oriented models and technologies have been promoted as the most suitable candidates for the design and development of distributed and intelligent applications in complex and dynamic environments. With respect to both their quality and range, the papers in this Special Issue already represent a meaningful sample of the most recent advancements in the field of agent-oriented models and technologies. In particular, the 17 contributions cover agent-based modeling and simulation, situated multi-agent systems, socio-technical multi-agent systems, and semantic technologies applied to multi-agent systems. In fact, it is surprising to witness how such a limited portion of MAS research already highlights the most relevant usage of agent-based models and technologies, as well as their most appreciated characteristics. We are thus confident that the readers of Applied Sciences will be able to appreciate the growing role that MASs will play in the design and development of the next generation of complex intelligent systems. This Special Issue has been converted into a yearly series, for which a new call for papers is already available at the Applied Sciences journal’s website: https://www.mdpi.com/journal/applsci/special_issues/Multi-Agent_Systems_2019

A scalability analysis of grid allocation mechanisms

This article examines the broker's behavior with regard to a varying number of participating nodes and shows that incremental losses have to be accepted in central resource allocation when introducing new nodes. --Grid Computing

Optimizing ad hoc trade in a commercial barter trade exchange

Abstract In this paper, we describe the operation of barter trade exchanges by identifying key techniques used by trade brokers to stimulate trade and satisfy member needs, and present algorithms to automate some of these techniques. In particular, we develop algorithms that emulate the practice of trade brokers by matching buyers and sellers in such a way that trade volume is maximized while the balance of trade is maintained as much as possible. We model the trade balance problem as a minimum cost circulation problem (MCC) on a network. When the products have uniform cost or when the products can be traded in fractional units, we solve the problem exactly. Otherwise, we present a novel stochastic rounding algorithm that takes the fractional optimal solution to the trade balance problem and produces a valid integer solution. We then make use of a greedy heuristic that attempts to match buyers and sellers so that the average number of suppliers that a buyer must use to satisfy a given product need is minimized. We present results of empirical evaluation of our algorithms on test problems and on simulations built using data from an operating trade exchange

Small-Scale Markets for Bilateral Resource Trading in the Sharing Economy

We consider a general small-scale market for agent-to-agent resource sharing, in which each agent could either be a server (seller) or a client (buyer) in each time period. In every time period, a server has a certain amount of resources that any client could consume, and randomly gets matched with a client. Our target is to maximize the resource utilization in such an agent-to-agent market, where the agents are strategic. During each transaction, the server gets money and the client gets resources. Hence, trade ratio maximization implies efficiency maximization of our system. We model the proposed market system through a Mean Field Game approach and prove the existence of the Mean Field Equilibrium, which can achieve an almost 100% trade ratio. Finally, we carry out a simulation study motivated by an agent-to-agent computing market, and a case study on a proposed photovoltaic market, and show the designed market benefits both individuals and the system as a whole

Peer-to-Peer Bartering: Swapping Amongst Self-interested Agents

Large--scale distributed environments can be seen as a conflict between the selfish aims of the participants and the group welfare of the population as a whole. In order to regulate the behavior of the participants it is often necessary to introduce mechanisms that provide incentives and stimulate cooperative behavior in order to mitigate for the resultant potentially undesirable availability outcomes which could arise from individual actions.The history of economics contains a wide variety of incentive patterns for cooperation. In this thesis, we adopt bartering incentive pattern as an attractive foundation for a simple and robust form of exchange to re-allocate resources. While bartering is arguably the world's oldest form of trade, there are still many instances where it surprises us. The success and survivability of the barter mechanisms adds to its attractiveness as a model to study.In this thesis we have derived three relevant scenarios where a bartering approach is applied. Starting from a common model of bartering: - We show the price to be paid for dealing with selfish agents in a bartering environment, as well as the impact on performance parameters such as topology and disclosed information.- We show how agents, by means of bartering, can achieve gains in goods without altruistic agents needing to be present.- We apply a bartering--based approach to a real application, the directory services.The core of this research is the analysis of bartering in the Internet Age. In previous times, usually economies dominated by bartering have suffered from high transaction costs (i.e. the improbability of the wants, needs that cause a transaction occurring at the same time and place). Nowadays, the world has a global system of interconnected computer networks called Internet. This interconnected world has the ability to overcome many challenges of the previous times. This thesis analysis the oldest system of trade within the context of this new paradigm. In this thesis we aim is to show thatbartering has a great potential, but there are many challenges that can affect the realistic application of bartering that should be studied.The purpose of this thesis has been to investigate resource allocation using bartering mechanism, with particular emphasis on applications in largescale distributed systems without the presence of altruistic participants in the environment.Throughout the research presented in this thesis we have contributed evidence that supports the leitmotif that best summarizes our work: investigation interactions amongst selfish, rational, and autonomous agents with incomplete information, each seeking to maximize its expected utility by means of bartering. We concentrate on three scenarios: one theoretical, a case of use, and finally a real application. All of these scenarios are used for evaluating bartering. Each scenario starts from a common origin, but each of them have their own unique features.The final conclusion is that bartering is still relevant in the modern world