A Proxy bidding Mechanism that Elicits all bids in an English Clock Auction Experiment

This paper reconsiders experimental tests at the English clock auction. We point out why the standard procedure can only use a small subset of all bids, which gives rise to a selection bias. We propose an alternative yet equivalent format that makes all bids visible, and apply it to a "wallet auction" experiment. Finally, we test the theory against various alternative hypotheses, and compare the results with thse that would have been obtained if one had used the standard procedure. Our results confirm that the standard tests are subject to a significant selection bias

Asymmetric first-price auctions with uniform distributions: analytic solutions to the general case

While auction research, including asymmetric auctions, has grown significantly in recent years, there is still little analytical solutions of first-price auctions outside the symmetric case. Even in the uniform case, Griesmer et al. (1967) and Plum (1992) find solutions only to the case where the lower bounds of the two distributions are the same. We present the general analytical solutions to asymmetric auctions in the uniform case for two bidders, both with and without a minimum bid. We show that our solution is consistent with the previously known solutions of auctions with uniform distributions. Several interesting examples are presented including a class where the two bid functions are linear. We hope this result improves our understanding of auctions and provides a useful tool for future research in auctions

Choice of Financing Mode as a Stochastic Bounded Control Problem

In this note I analyze situations where an entrepreneur needs external financing from an outside investor in order to start an investment project that will yield a profit for two consecutive periods. The value of second-period profit is the entrepreneur's private information. I show that the choice of financing mode can be transformed into an optimal stochastic bounded control problem, where the state variable t represents the investor's first-period payoff and the control variable α can be interpreted in terms of the investor's residual profit rights. I then show that under certain general conditions such as the monotonicity and continuity of t (which have clear economic interpretations), an optimal contract is characterized by maximal α under low values of t and minimal α under high values of t. In economic terms this corresponds to debt

Analysis of Adhesion Molecules and Basement Membrane Contributions to Synaptic Adhesion at the Drosophila Embryonic NMJ

Synapse formation and maintenance crucially underlie brain function in health and disease. Both processes are believed to depend on cell adhesion molecules (CAMs). Many different classes of CAMs localise to synapses, including cadherins, protocadherins, neuroligins, neurexins, integrins, and immunoglobulin adhesion proteins, and further contributions come from the extracellular matrix and its receptors. Most of these factors have been scrutinised by loss-of-function analyses in animal models. However, which adhesion factors establish the essential physical links across synaptic clefts and allow the assembly of synaptic machineries at the contact site in vivo is still unclear. To investigate these key questions, we have used the neuromuscular junction (NMJ) of Drosophila embryos as a genetically amenable model synapse. Our ultrastructural analyses of NMJs lacking different classes of CAMs revealed that loss of all neurexins, all classical cadherins or all glutamate receptors, as well as combinations between these or with a Laminin deficiency, failed to reveal structural phenotypes. These results are compatible with a view that these CAMs might have no structural role at this model synapse. However, we consider it far more likely that they operate in a redundant or well buffered context. We propose a model based on a multi-adaptor principle to explain this phenomenon. Furthermore, we report a new CAM-independent adhesion mechanism that involves the basement membranes (BM) covering neuromuscular terminals. Thus, motorneuronal terminals show strong partial detachment of the junction when BM-to-cell surface attachment is impaired by removing Laminin A, or when BMs lose their structural integrity upon loss of type IV collagens. We conclude that BMs are essential to tie embryonic motorneuronal terminals to the muscle surface, lending CAM-independent structural support to their adhesion. Therefore, future developmental studies of these synaptic junctions in Drosophila need to consider the important contribution made by BM-dependent mechanisms, in addition to CAM-dependent adhesion