WPO, COV and IIA bargaining solutions

The class of bargaining solutions that are defined on the domain of finite sets of alternatives and satisfy Weak Pareto Optimality (WPO), Independence of Irrelevant Alternatives (IIA) and Covariance (COV), is characterized. These solutions select from the set of maximizers of a nonsymmetric Nash product -- i.e., from a nonsymmetric (multi-valued) Nash bargaining solution -- according to a specific decomposition of the indifference curves of this Nash product. We use this characterization in two ways. First, we derive consequences on this domain and on larger domains of compact (non-convex) bargaining problems, and show that most results in the literature are special cases and consequences of our central results -- in particular by adding continuity or symmetry axioms. Second, since the continuity axiom prevents nontrivial selections from the Nash bargaining solutions, we use the Axiom of choice to construct for example non-single-valued discontinuous WPO, IIA and COV bargaining solutions. It is conjectured that, in the case of two-person bargaining problems,the existence of such discontinuous bargaining solutions cannot be shown from the Zermelo-Fraenkel axioms for set theory without using the Axiom of Choice.mathematical economics;

Segmented assimilation and cross-national comparative research on the integration of immigrants and their children

In the study of immigrant integration - understood as the integration of immigrants and their offspring - segmented assimilation theory stands out as the most comprehensive, coherent and systematic approach in its field. It is much discussed, but also much contested. This article attempts a critical evaluation of the theory. It looks also at the question if the theory applies to Europe and if it can thus be used in cross-national research

Intentional Price Wars on the Equilibrium Path

In this paper we study the effect of information on the occurrence of intentional price wars on the equilibrium path. An episode of low prices is an intentional price war if it follows a period of high prices which was ended intentionally by one of the firms in the market (the price war leader). We show that for intentional price wars to exist on the equilibrium path, two elements are necessary regarding the information on which the firms base their decisions: (1) interperiod dynamics and (2) informational asymmetries. We illustrate this by means of a repeated price-setting game in which market shares fluctuate. Firms learn about the market share realizations at the beginning of each period. We show that intentional price wars on the equilibrium path are possible when firms have private information about their market share. When market shares are public information, we either see collusive price adjustment or episodes of low prices that do not classify as an intentional price war.microeconomics ;

Noncooperative Collusion and Price Wars with Individual Demand Fluctuations

We analyze whether noncooperative collusive equilibria are harder to sustain when individual demand levels are not fixed but are able to fluctuate. To do this, we extend a Bertrand type model of price competition to allow for fluctuating market shares when prices are equal. We find that, the larger the market share fluctuations may be, the higher the discount factor should be to sustain a collusive equilibrium in trigger strategies. The intuition behind this is fairly straightforward. When individual demand in the collusive state is suddenly low, the gains from collusion go down. Moreover, the firm with the low demand can capture a larger share of the market by deviating from the collusive strategy. The incentive to deviate therefore becomes larger when the individual market share decreases. We also look at the existence of a specific type of semi-collusive equilibrium when individual market shares are either common knowledge or private knowledge. We find that there exist equilibria in which competitive periods (price wars) occur with probability 1 and on the equilibrium path.mathematical economics;

Stochastic dominance equilibria in two-person noncooperative games

Two-person noncooperative games with finitely many pure strategies and ordinal preferences over pure outcomes are considered, in which probability distributions resulting from mixed strategies are evaluated according to t-degree stochastic dominance. A t-best reply is a strategy that induces a t-degree stochastically undominated distribution, and a t-equilibrium is a pair of t-best replies. The paper provides a characterization and existence proofs of t-equilibria in terms of representing utility functions, and shows that for t becoming large-which can be interpreted as the players becoming more risk averse-behavior converges to a specific form of max-min play. More precisely, this means that in the limit each player puts all weight on a strategy that maximizes the worst outcome for the opponent, within the supports of the strategies in the limiting sequenceof t-equilibria.microeconomics ;

Revision of conjectures about the opponent's utilities in signaling games.

In this paper we apply the concept of preference conjecture equilibrium introduced in Perea (2003) to signaling games and show its relation to sequential equilibrium. Furthermore, we introduce the concept of minimum revision equilibrium and show how this can be interpreted as a refinement of sequential equilibrium. We also present a method to compute preference conjecture equilibria.econometrics;

Azithromycin in Chronic Fatigue Syndrome (CFS), an analysis of clinical data

Background: CFS is a clinical state with defined symptoms, but undefined cause. The patients may show a chronic state of immune activation and treatment with an antibiotic in this subgroup has been suggested. Methods: In a retrospective study, the response of CFS patients to azithromycin, an antibiotic and immunomodulating drug, has been scored from the patients records and compared with clinical and laboratory data. Azithromycin was not the first choice therapy, but offered when the effect of counseling and L-carnitine was considered insufficient by the patient and the clinician. Results: Of the 99 patients investigated, 58 reported a decrease in the symptoms by the use of azithromycin. These responding patients had lower levels of plasma acetylcarnitine. Conclusion: The efficacy of azithromycin in the responsive patients could be explained by the modulating effect on a chronic primed state of the immune cells of the brain, or the activated peripheral immune system. Their lower acetylcarnitine levels may reflect a decreased antioxidant defense and/or an increased consumption of acetylcarnitine caused by oxidative stress