Simple Sequencing Problems with Interdependent Costs

In this paper we analyze sequencing situations under incomplete information where agents have interdependent costs. We first argue why Vickrey-Clarke-Groves (or VCG) mechanism fails to implement a simple sequencing problem in dominant strategies. Given this impossibility, we try to implement simple sequencing problems in ex-post equilibrium. We show that a simple sequencing problem is implementable if and only if the mechanism is a `generalized VCG mechanism'. We then show that for implementable n agent simple sequencing problems, with polynomial cost function of order (n-2) or less, one can achieve first best implementability. Moreover, for the class of simple sequencing problems with ``sufficiently well behaved'' cost function, this is the only class of first best implementable simple sequencing problems.Simple Sequencing Problems, Ex-post Equilibrium, First Best Implementability

Amendment of Heuts-Selen's lotsizing and sequencing heuristic for single stage process manufacturing systems

Productivity;Production Scheduling;Manufacturing;production

Technological Interdependencies,Specialization and Coordination A Property Rights Perspective on The Nature of the Firm

This paper develops a property rights perspective on the nature of the firm. The basic idea is that learning by doing in production and coordination stem from experience in production and that user rights over productive assets are necessary in order to accumulate the experience needed to perform improvements in production. Accumulation of skills from learning by doing in production is accelerated by specialization in production. However, specialization introduces greater complexity and new kinds of tools and equipment and this creates uncertainty about the best way of coordinating specialized interdependent activities. The result may be bottlenecks in production and uneven development of components. Experimenting in coordination is necessary in order to eliminate these problems. It is argued that the Coasian notion of firms where coordination is provided by the direction of managers provides a cheap way of conducting the experiments needed to collect information on how best to coordinate interdependent activities.Property rights, specialization in production, firm, boundaries, learning

How Best to Auction Natural Resources

I study the design of auctions of natural resources, such as oil or mineral rights. A good auction design promotes both an efficient assignment of rights and competitive revenues for the seller. The structure of bidder preferences and the degree of competition are key factors in determining the best design. With weak competition and simple value structures, a simultaneous first-price sealed-bid auction may suffice. With more complex value structures, a dynamic auction with package bids likely is needed to promote efficiency and revenue objectives. Bidding on production shares, rather than bonuses, typically increases government take by reducing oil or mining company risk.Auctions, natural resource auctions, oil auctions

The equal gain splitting rule for sequencing situations and the general nucleolus

Game Theory

Steps in Metagenomics: Let’s Avoid Garbage in and Garbage Out

Is metagenomics a revolution or a new fad? Metagenomics is tightly associated with the availability of next-generation sequencing in all its implementations. The key feature of these new technologies, moving beyond the Sanger-based DNA sequencing approach, is the depth of nucleotide sequencing per sample.1 Knowing much more about a sample changes the traditional paradigms of “What is the most abundant?” or “What is the most significant?” to “What is present and potentially sig­nificant that might influence the situation and outcome?” Let’s take the case of identifying proper biomarkers of disease state in the context of chronic disease prevention. Prevention has been deemed as a viable option to avert human chronic diseases and to curb health­care management costs.2 The actual implementation of any effective preventive measures has proven to be rather difficult. In addition to the typically poor compliance of the general public, the vagueness of the successful validation of habit modification on the long-term risk, points to the need of defining new biomarkers of disease state. Scientists and the public are accepting the fact that humans are super-organisms, harboring both a human genome and a microbial genome, the latter being much bigger in size and diversity, and key for the health of individuals.3,4 It is time to investigate the intricate relationship between humans and their associated microbiota and how this relationship mod­ulates or affects both partners.5 These remarks can be expanded to the animal and plant kingdoms, and holistically to the Earth’s biome. By its nature, the evolution and function of all the Earth’s biomes are influenced by a myriad of interactions between and among microbes (planktonic, in biofilms or host associated) and the surrounding physical environment. The general definition of metagenomics is the cultivation-indepen­dent analysis of the genetic information of the collective genomes of the microbes within a given environment based on its sampling. It focuses on the collection of genetic information through sequencing that can target DNA, RNA, or both. The subsequent analyses can be solely fo­cused on sequence conservation, phylogenetic, phylogenomic, function, or genetic diversity representation including yet-to-be annotated genes. The diversity of hypotheses, questions, and goals to be accomplished is endless. The primary design is based on the nature of the material to be analyzed and its primary function

When queueing is better than push and shove

We address the scheduling problem of reordering an existing queue into its efficient order through trade. To that end, we consider individually rational and balanced budget direct and indirect mechanisms. We show that this class of mechanisms allows us to form efficient queues provided that existing property rights for the service are small enough to enable trade between the agents. In particular, we show on the one hand that no queue under a fully deterministic service schedule such as first-come, first-serve can be dissolved efficiently and meet our requirements. If, on the other hand, the alternative is service anarchy (ie. a random queue), every existing queue can be transformed into an efficient order

Compromise values in cooperative game theory

Bargaining;game theory

Allocative and Informational Externalities in Auctions and Related Mechanisms

We study the effects of allocative and informational externalities in (multi-object) auctions and related mechanisms. Such externalities naturally arise in models that embed auctions in larger economic contexts. In particular, they appear when there is downstream interaction among bidders after the auction has closed. The endogeneity of valuations is the main driving force behind many new, specific phenomena with allocative externalities: even in complete information settings, traditional auction formats need not be efficient, and they may give rise to multiple equilibria and strategic non-participation. But, in the absence of informational externalities, welfare maximization can be achieved by Vickrey-Clarke- Groves mechanisms. Welfare-maximizing Bayes-Nash implementation is, however, impossible in multi-object settings with informational externalities, unless the allocation problem is separable across objects (e.g. there are no allocative externalities nor complementarities) or signals are one-dimensional. Moreover, implementation of any choice function via ex-post equilibrium is generically impossible with informational externalities and multidimensional types. A theory of information constraints with multidimensional signals is rather complex, but indispensable for our study