Risk Aversion and Income Tax Enforcement

This paper characterizes optimal income tax and audit schemes in the presence of costly enforcement when the agent is risk averse and not necessarily risk neutral. It is shown that the results under risk-neutrality (Chander and Wilde (1998)) largely hold under risk aversion. We first show that in an optimal scheme the tax evasion decision of the agent is equivalent to risking his entire income against a possible gain in terms of lower tax payment. We then introduce a measure of aversion to such large risks. In contrast, the Arrow-Pratt coefficients of risk aversion measure aversion to small risks only. We show that the optimal tax function is non-decreasing and concave if the agent’s aversion to large risks, as defined in terms of our measure, is decreasing with income. The optimal audit function is non-increasing and the audits may be random or deterministic.expected utility, risk aversion, principal-agent, adverse selection

The Gamma-Core and Coalition Formation

This paper reinterprets the gamma-core (Chander and Tulkens (1995, 1997)) and justifies it as well as its prediction that the efficient coalition structure is stable in terms of the coalition formation theory. It is assumed that coalitions can freely merge or break apart, are farsighted (that is, it is the final and not the immediate payoffs that matter to the coalitions) and a coalition may deviate if and only if it stands to gain from it. It is then shown that subsequent to a deviation by a coalition, the nonmembers will have incentives to break apart into singletons, as is assumed in the definition of the gamma-characteristic function, and that the grand coalition is the only stable coalition structure.strategic games, coalition formation, farsighted, core, characteristic function

Cores of games with positive externalities

This paper introduces a core concept, called the γ-core, in the primitive framework of a strategic game. For a certain class of strategic games, it is a weaker concept than the strong Nash equilibrium, but in general stronger than the conventional α- and β- cores. We argue that the coalition formation process is an infinitely repeated game and show that the grand coalition forms if the γ-core is nonempty. This is a weaker sufficient condition than the previous such condition (Maskin (2003, Theorem 4)). As an application of this result, it is shown that the γ- core of an oligopolistic market is nonempty and thus the grand coalition forms.positive externalities, strategic game, core, repeated game, coalition formation

Green consumerism and collective action

We analyze the effect of collective action by green/environmentally aware consumers on ambient environmental quality and market equilibrium. We consider a model with two types of consumers who differ in their willingness-to-pay for a good available in two different environmental qualities, and two competing firms: one selling the good of high environmental quality and the other of low environmental quality. We show that collective action by green consumers reduces competition and leads to higher prices for the good of both qualities. Though it improves the ambient environmental quality, it may reduce the welfare of both types of consumers.green consumers, collective action, environmental quality, differentiated duopoly, firm profitability

Incentives and a Process Converging to the Core of a Public Goods Economy

The paper considers economies involving one public good, one private good, and constant returns to scale. It is shown that the process proposed earlier in Chander (1983, 1987a, and 1987b) always converges to an allocation which is in the core of the economy. This is then interpreted as an incentive property of the process and it is shown that there exists no process which always converges to the core and in which truth-telling constitutes a dominance equilibrium of the 'local incentive game'

Cooperation, Stability and Self-Enforcement in International Environmental Agreements: A Conceptual Discussion

In essence, any international environmental agreement (IEA) implies cooperation of a form or another. The paper seeks for logical foundations of this. It first deals with how the need for cooperation derives from the public good aspect of the externalities involved, as well as with where the source of cooperation lies in cooperative game theory. In either case, the quest for efficiency is claimed to be at the root of cooperation. Next, cooperation is considered from the point of view of stability. After recalling the two competing concepts of stability in use in the IEA literature, new insights on the nature of the gamma core in general are given as well as of the Chander-Tulkens solution within the gamma core. Free riding is also evaluated in relation with the alternative forms of stability under scrutiny. Finally, it is asked whether with the often mentioned virtue of “self enforcement” any conceptual gain is achieved, different from what is meant by efficiency and stability. A skeptical answer is offered, as a reply to Barrett’s (2003) attempt at giving the notion a specific content.International Environmental Agreements, Cooperation, Stability, Self-enforcement

The Core of an Economy With Multilateral Environmental Externalities

When environmental externalities are international—i.e. transfrontier—they most often are multilateral and embody public good characteristics. Improving upon inefficient laissez-faire equilibria requires voluntary cooperation for which the game-theoretic core concept provides optimal outcomes that have interesting properties against free riding. To define the core, however, the characteristic function of the game associated with the economy (which specifies the payoff achievable by each possible coalition of players—here, the countries) must also specify in each case the behavior of the players which are not members of the coalition. This has been for a long time a major unsolved problem in the theory of the core of economies with many producers of a public good. Among the several assumptions that can be made in this respect, a plausible one is defined in this paper, for which it is then shown that the core is nonempty. The proof is constructive in the sense that it exhibits a solution (i.e., an explicit coordinated abatement policy ) that has the desired property of nondomination by any proper coalition of countries, given the assumed behavior of the other countries

Incentives and a Process Converging to the Core of a Public Goods Economy

The paper considers economies involving one public good, one private good, and constant returns to scale. It is shown that the process proposed earlier in Chander (1983, 1987a, and 1987b) always converges to an allocation which is in the core of the economy. This is then interpreted as an incentive property of the process and it is shown that there exists no process which always converges to the core and in which truth-telling constitutes a dominance equilibrium of the 'local incentive game'

Synthesis, Characterization and Evaluation of Anticancer Activity of Nanoresveratrol in B16 Melanoma Cell Line

Resveratrol, a member of the stilbene family, is a naturally occurring polyphenolic compound in grapes and other botanicals. It carries a potential to prevent or treat several chronic diseases, including cancers. Despite various promising health benefits, including chemopreventive and chemotherapeutic benefits against cancer, clinical translation of resveratrol is hampered due to its poor bioavailability, solubility and stability. Here we present the study to prepare nano-formulation of resveratrol for improving the resveratrol profile. Calcium phosphate loaded nanoresveratrol has been synthesized, characterized and its anti-proliferative effects were examined in a B16 murine melanoma cell line. The anti-cancer effects of nanoresveratrol were directly compared with free resveratrol and chemotherapy drug 5-FU. Nanoresveratrol induced apoptosis in B16 melanoma more efficiently as compared to resveratrol alone and 5 FU. A nuclear staining profile following Hoechst staining of B16 cells is indicative of apoptosis and shows that the anti-cancer effect of nanoresveratrol is due to apoptosis induction. Since antioxidant activity is a hallmark of resveratrol, we also measured the biochemical antioxidant activities of superoxide dismutase (SOD) and catalase antioxidant enzymes. We found that, concurrent with the anti-cancer activity, the antioxidant activity of nanoresveratrol increased. Collectively, these findings clearly show that nanoresveratrol is superior to free resveratrol in suppressing cell growth in B16 murine melanoma cell line, and that the anti-cancer activity is primarily through apoptosis induction. Keywords:  Resveratrol, Nanoresveratrol, Formulation, B16 cell line, Cancer, Melanoma, Chemopreventive, Chemotherapeuti