Computational rationality and voluntary provision of public goods: an agent-based simulation model

The issue of the cooperation among private agents in realising collective goods has always raised problems concerning the basic nature of individual behaviour as well as the more traditional economic problems. The Computational Economics literature on public goods provision can be useful to study the possibility of cooperation under alternative sets of assumptions concerning the nature of individual rationality and the kind of interactions between individuals. In this work I will use an agent-based simulation model to study the evolution of cooperation among private agents taking part in a collective project: a high number of agents, characterised by computational rationality, defined as the capacity to calculate and evaluate their own immediate payoffs perfectly and without errors, interact to producing a public good. The results show that when the agents’ behaviour is not influenced either by expectations of others’ behaviour or by social and relational characteristics, they opt to contribute to the public good to an almost socially optimal extent, even where there is no big difference between the rates of return on the private and the public investment.Computational Economics; Agent-based models; Social Dilemmas; Collective Action; Public Goods

The Effective Design of Managerial Incentive Systems:Combining Theoretical Principles and Practical Trade'-offs.

On the use of theoretical developments in agency economics for the practical design of incentive- and performance-based compensation systems.managerial compensation; principal-agent theory; incentive and performance based compensation systems

Competing and Learning in Global Value Chains - Firms’ Experiences in the Case of Uganda. A study of five export sub-sectors with reference to trade between Uganda and Europe

Executive Summary and Chapter 5: Presentation and discussion of main finding

Self-Commitment-Institutions and Cooperation in Overlapping Generations Games

This paper focuses on a two-period OLG economy with public imperfect observability over the intergenerational cooperative dimension. Individual endowment is at free disposal and perfectly observable. In this environment we study how a new mechanism, we call Self-Commitment-Institution (SCI), outperforms personal and community enforcement in achieving higher ex-ante e¢ ciency. Social norms with and without SCI are characterized. If social norms with SCI are implemented, agents might freely dispose of their endowment. As long as they reduce their marginal gain from deviation in terms of current utility, they also credibly self-commit on intergenerational cooperation. Under quite general conditions we .nd that, even if individual strategies are still characterized by behavioral uncertainty, the introduction of SCI relaxes the inclination toward opportunistic behavior and sustains higher e¢ ciency compared to social norms without SCI. We quantify the value of SCI and investigate the role of memory with di¤erent social norms. Finally, applications on intergenerational public good games and transfer games with productive SCI are providedCooperation; Free disposal; Imperfect public monitoring; Memory; Overlapping generation game; Self-Commitment Institution;

Human-agent collectives

We live in a world where a host of computer systems, distributed throughout our physical and information environments, are increasingly implicated in our everyday actions. Computer technologies impact all aspects of our lives and our relationship with the digital has fundamentally altered as computers have moved out of the workplace and away from the desktop. Networked computers, tablets, phones and personal devices are now commonplace, as are an increasingly diverse set of digital devices built into the world around us. Data and information is generated at unprecedented speeds and volumes from an increasingly diverse range of sources. It is then combined in unforeseen ways, limited only by human imagination. People’s activities and collaborations are becoming ever more dependent upon and intertwined with this ubiquitous information substrate. As these trends continue apace, it is becoming apparent that many endeavours involve the symbiotic interleaving of humans and computers. Moreover, the emergence of these close-knit partnerships is inducing profound change. Rather than issuing instructions to passive machines that wait until they are asked before doing anything, we will work in tandem with highly inter-connected computational components that act autonomously and intelligently (aka agents). As a consequence, greater attention needs to be given to the balance of control between people and machines. In many situations, humans will be in charge and agents will predominantly act in a supporting role. In other cases, however, the agents will be in control and humans will play the supporting role. We term this emerging class of systems human-agent collectives (HACs) to reflect the close partnership and the flexible social interactions between the humans and the computers. As well as exhibiting increased autonomy, such systems will be inherently open and social. This means the participants will need to continually and flexibly establish and manage a range of social relationships. Thus, depending on the task at hand, different constellations of people, resources, and information will need to come together, operate in a coordinated fashion, and then disband. The openness and presence of many distinct stakeholders means participation will be motivated by a broad range of incentives rather than diktat. This article outlines the key research challenges involved in developing a comprehensive understanding of HACs. To illuminate this agenda, a nascent application in the domain of disaster response is presented

Self-Commitment-Institutions and Cooperation in Overlapping Generations Games

This paper focuses on a two-period OLG economy with public imperfect observability over the intergenerational cooperative dimension. Individual endowment is at free disposal and perfectly observable. In this environment we study how a new mechanism, we call Self-Commitment-Institution (SCI), outperforms personal and community enforcement in achieving higher ex-ante efficiency. Social norms with and without SCI are characterized. If social norms with SCI are implemented, agents might freely dispose of their endowment. As long as they reduce their marginal gain from deviation in terms of current utility, they also credibly self-commit on intergenerational cooperation. Under quite general conditions we find that, even if individual strategies are still characterized by behavioral uncertainty, the introduction of SCI relaxes the inclination toward opportunistic behavior and sustains higher efficiency compared to social norms without SCI. We quantify the value of SCI and investigate the role of memory with different social norms. Finally, applications on intergenerational public good games and transfer games with productive SCI are provided.Cooperation, Free disposal, Imperfect public monitoring, Memory, Overlapping generation game, Self-Commitment Institution

An Objective-Based Perspective on Assessment of Model-Supported Policy Processes

Simulation models, being in use for a long time in natural sciences and engineering domains, are diffusing to a wider context including policy analysis studies. The differences between the nature of the domain of application, as well as the increased variety of usage partially induced by this difference naturally imply new challenges to be overcome. One of these challenges is related to the assessment of the simulation-based outcomes in terms of their reliability and relevance in the policy context being studied. The importance of this assessment is twofold. First of all, it is all about conducting a high quality policy study with effective results. However, the quality of the study does not necessarily imply acceptance of the results by the clients and/or colleagues. This problem of policy analysts increases the importance of such an assessment; an effective assessment may induce the acceptance of the conclusions drawn from the study by the clients and/or colleagues. The main objective of this paper is to introduce an objective-based assessment perspective for simulation model-supported policy studies. As a first step towards such a goal, an objective-based classification of models is introduced. Based on that, we will discuss the importance of different aspects of the assessment for each type. In doing so, we aim to provide a structured discussion that may serve as a sort of methodological guideline to be used by policy analysts, and also by clients.Simulation, Validation, Model Assessment, Policy Analysis, Model Typology