Liquidity constraints and credit subsidies in auctions

I consider an auction with participants that differ in valuation and access to liquid assets. Assuming credit is costly (e.g. due to moral hazard considerations) different auction rules establish different ways of screening valuation-liquidity pairs. The paper shows that standard auction forms result in different allocation rules. When the seller can deny access to capital markets or offer credit subsidies, she gains an additional tool to screen agents. The paper derives conditions under which the seller increases profits by way of subsidizing loans. In particular, in a second price auction, the seller always benefits from offering small subsidies. The result extends to a non-auction setting to show that a monopolist may use credit subsidies as a price discrimination device

LIQUIDITY CONSTRAINTS AND CREDIT SUBSIDIES IN AUCTIONS

I consider an auction with participants that differ in valuation and access to liquid assets. Assuming credit is costly (e.g. due to moral hazard considerations) different auction rules establish different ways of screening valuation-liquidity pairs. The paper shows that standard auction forms result in different allocation rules. When the seller can deny access to capital markets or offer credit subsidies, she gains an additional tool to screen agents. The paper derives conditions under which the seller increases profits by way of subsidizing loans. In particular, in a second price auction, the seller always benefits from offering small subsidies. The result extends to a non-auction setting to show that a monopolist may use credit subsidies as a price discrimination device.

MORAL HAZARD IN TEAMS WITH LIMITED PUNISHMENTS AND MULTIPLE OUTPUTS

This paper studies incentive provision with limited punishments. It revisits the moral hazard problem with risk neutral parties and solves for optimal compensation schemes in situations where agents' participation is implied by a limited liability constraint. Providing minimum cost incentives to teams or individuals requires awarding high bonuses only when extreme performances are observed. Even when the first-best is attainable, the principal may prefer to induce more (or less) effort than it is sociably desirable because she only cares about the marginal cost of motivation. With positive production externalities joint bonuses are optimal. With limited liability on the principal's side, the optimal scheme becomes a tournament---even in the absence of externalities. The paper also looks at conditions that favor one incentive scheme over another when agents adapt their strategies as information becomes available.

Using the Dipolar and Quadrupolar Moments to Improve Solar-Cycle Predictions Based on the Polar Magnetic Fields

The solar cycle and its associated magnetic activity are the main drivers behind changes in the interplanetary environment and Earth's upper atmosphere (commonly referred to as space weather and climate). In recent years there has been an effort to develop accurate solar cycle predictions, leading to nearly a hundred widely spread predictions for the amplitude of solar cycle 24. Here we show that cycle predictions can be made more accurate if performed separately for each hemisphere, taking advantage of information about both the dipolar and quadrupolar moments of the solar magnetic field during minimum

Patterns of species richness in sandy beaches of South America

Species richness of the intertidal macroinfauna of exposed sandy beaches around South America is reviewed in relation to geographic location. This macroinfauna is dominated by cirolanid isopods (Excirolana), bivalves (Mesodesma and Donax) and opheliid and spionid polychaetes. In general, the upper shore of tropical and subtropical beaches is characterized by crabs (Ocypodidae), whereas on temperate beaches it is dominated by talitrid amphipods and cirolanid isopods. The middle shore is primarily occupied by cirolanids and bivalves, and hippid crabs, bivalves and amphipods dominate the lower beach. Generally, species richness increases from upper to lower beach levels. Studies carried out on exposed sandy beaches of south-central Chile (ca. 40°S) show that different beach states harbour differences in species richness, with the greatest species richness on dissipative beaches, and the least on beaches with reflective characteristics, a pattern also observed in Uruguay

Are Time-Domain Self-Force Calculations Contaminated by Jost Solutions?

The calculation of the self force in the modeling of the gravitational-wave emission from extreme-mass-ratio binaries is a challenging task. Here we address the question of the possible emergence of a persistent spurious solution in time-domain schemes, referred to as a {\em Jost junk solution} in the literature, that may contaminate self force calculations. Previous studies suggested that Jost solutions are due to the use of zero initial data, which is inconsistent with the singular sources associated with the small object, described as a point mass. However, in this work we show that the specific origin is an inconsistency in the translation of the singular sources into jump conditions. More importantly, we identify the correct implementation of the sources at late times as the sufficient condition guaranteeing the absence of Jost junk solutions.Comment: RevTeX. 5 pages, 2 figures. Version updated to match the contents of the published articl

Creating a Vision for XYZ Research Corporation: A Case Study

A strategic analysis was developed for XYZ Research Corporation (the true company's name is disguised). The strategic analysis involved a series of visits to the company to conduct focus groups with its employees and management. Five focus groups were carried out at XYZ Research Corporation. This method proved to be effective and valuable when aiming to gather detailed information on the specifics of a firm's operation. Information and insights on the company and its business that would not become evident through any kind of meticulous financial or economic analysis of the company's and industry's numbers - which in fact were unavailable or scarce - was efficiently obtained by personal communication from the employees in the interviews. The focus group and interview method is recommended as a valid alternative to gathering detailed data and information when facing limited availability of reliable quantitative economic data on sales, size, and other information on the industry. The amount and quality of person-to-person information gathered in the interviews made the questionnaire a more powerful tool versus the alternative of simply mailing it. In the process of developing a strategic plan for XYZ, data and information used to write an undergraduate level teaching case study was gathered. The focus group method allowed for digging out intricate functional relationships within the company and between the company and the industry, which allowed for writing a more complete and educationally interesting case study.Focus Groups, Strategic Analysis, Food Safety, Outsourcing, Research Methods/ Statistical Methods, A22, C99, L21, M10,