Tacit Collusion in the Presence of Cyclical Demand and Endogenous Capacity Levels

We analyze tacit collusion in an industry characterized by cyclical demand and long-run scale decisions; firms face deterministic demand cycles and choose capacity levels prior to competing in prices. Our focus is on the nature of prices. We find that two types of price wars may exist. In one, collusion can involve periods of mixed strategy price wars. In the other, consistent with the Rotemberg and Saloner (1986) definition of price wars, we show that collusive prices can also become countercyclical. We also establish pricing patterns with respect to the relative prices in booms and recessions. If the marginal cost of capacity is high enough, holding current demand constant, prices in the boom will be generally lower than the prices in the recession; this reverses the results of Haltiwanger and Harrington (1991). In contrast, if the marginal cost of capacity is low enough, then prices in the boom will be generally higher than the prices in the recession. For costs in an intermediate range, numerical examples are calculated to show specific pricing patterns.

Identification of Cellular Infiltrates during Early Stages of Brain Inflammation with Magnetic Resonance Microscopy

A comprehensive view of brain inflammation during the pathogenesis of autoimmune encephalomyelitis can be achieved with the aid of high resolution non-invasive imaging techniques such as microscopic magnetic resonance imaging (μMRI). In this study we demonstrate the benefits of cryogenically-cooled RF coils to produce μMRI in vivo, with sufficient detail to reveal brain pathology in the experimental autoimmune encephalomyelitis (EAE) model. We could visualize inflammatory infiltrates in detail within various regions of the brain, already at an early phase of EAE. Importantly, this pathology could be seen clearly even without the use of contrast agents, and showed excellent correspondence with conventional histology. The cryogenically-cooled coil enabled the acquisition of high resolution images within short scan times: an important practical consideration in conducting animal experiments. The detail of the cellular infiltrates visualized by in vivo μMRI allows the opportunity to follow neuroinflammatory processes even during the early stages of disease progression. Thus μMRI will not only complement conventional histological examination but will also enable longitudinal studies on the kinetics and dynamics of immune cell infiltration

Cell-Surface Marker Signatures for the Isolation of Neural Stem Cells, Glia and Neurons Derived from Human Pluripotent Stem Cells

Neural induction of human pluripotent stem cells often yields heterogeneous cell populations that can hamper quantitative and comparative analyses. There is a need for improved differentiation and enrichment procedures that generate highly pure populations of neural stem cells (NSC), glia and neurons. One way to address this problem is to identify cell-surface signatures that enable the isolation of these cell types from heterogeneous cell populations by fluorescence activated cell sorting (FACS).We performed an unbiased FACS- and image-based immunophenotyping analysis using 190 antibodies to cell surface markers on naïve human embryonic stem cells (hESC) and cell derivatives from neural differentiation cultures. From this analysis we identified prospective cell surface signatures for the isolation of NSC, glia and neurons. We isolated a population of NSC that was CD184(+)/CD271(-)/CD44(-)/CD24(+) from neural induction cultures of hESC and human induced pluripotent stem cells (hiPSC). Sorted NSC could be propagated for many passages and could differentiate to mixed cultures of neurons and glia in vitro and in vivo. A population of neurons that was CD184(-)/CD44(-)/CD15(LOW)/CD24(+) and a population of glia that was CD184(+)/CD44(+) were subsequently purified from cultures of differentiating NSC. Purified neurons were viable, expressed mature and subtype-specific neuronal markers, and could fire action potentials. Purified glia were mitotic and could mature to GFAP-expressing astrocytes in vitro and in vivo.These findings illustrate the utility of immunophenotyping screens for the identification of cell surface signatures of neural cells derived from human pluripotent stem cells. These signatures can be used for isolating highly pure populations of viable NSC, glia and neurons by FACS. The methods described here will enable downstream studies that require consistent and defined neural cell populations

Performance Measurement in Military Operations: Information versus Incentives

We explore the impact of success measurement on military organizations. In particular, we develop a model to understand how imperfect measures of success may have deleterious externalities by creating unintended incentive structures for an agent. We show that the informational properties of the measurements are based on how the measure di¤ers from operational success while the incentive properties of the measurement are based on di¤er- ences in the marginal sensitivity of both the measure and operational success. Further, we show that undervaluing incentive properties of measurement will lead to systematic posi- tive bias of information. We use the examples of the Second World War and the Vietnam War to illustrate variation in the di¢ culty of measurement from conventional warfare to counterinsurgency. Finally, we discuss the relevance of our analysis to the current con ict in Afghanistan. Blanken

Performance Measurement in Military Operations: Information versus Incentives

accepted for publication in Defence and Peace EconomicsWe explore the impact of strategic assessment efforts on military organizations at war. To do so, we construct a model to explore the impact of a principal’s choice among imperfect performance metrics for a military operation. In doing so, the principal must consider both the incentivizing and informational properties of the metric. We show the conditions under which uncertainty regarding the nature of the agent, as well as uncertainty regarding the operational environment, drives a metric choice that induces pathological behavior from the agent. More specifically, a poor metric choice can create an overly optimistic assessment and end up prolonging the conflict. We illustrate the model’s insights in the cases of the Second World War and the Vietnam War

Unpacking the Various Meanings of Redundancy: From Refining the Concept to Military Planning

The article of record as published may be found at http://dx.doi.org/10.1080/14751798.2012.730721The authors engage in the debate over waste in military force structure planning by rigorously deconstructing the concept of “redundancy.” First, a typology of redundancy is constructed that provides a common framework for identifying variety among redundant structures. These are labeled “true redundancy,” “expanded capacity,” “portfolio diversification,” and “mission overlap.” Further, a number of mechanisms are identified that produce these types of structures, and show the conditions under which planners may utilize redundant structure in the search for optimization. In sum, the article provides refined concepts for analysts and planners to identify when redundancy is deleterious or beneficial

Consumer Rationing and the Cournot Outcome

For a symmetric two-stage game, where firms first choose capacities, then compete in prices, Kreps and Scheinkman (Bell Journal of Economics, 1983, 14(2), pp. 326-337) prove that under efficient rationing the Nash equilibrium coincides with the Cournot equilibrium. We extend the model to include asymmetric costs and provide new results showing that the capacity choice game is dominance-solvable, just like the Cournot game. Further, we provide a simple sufficient condition, under which the dominance-solvable result extends to proportional rationing. The results provide new insights into the robustness of Cournot coincidence under alternate demand rationing schemes

Consumer Rationing and the Cournot Outcome

For a symmetric two-stage game, where firms first choose capacities, then compete in prices, Kreps and Scheinkman (Bell Journal of Economics, 1983, 14(2), pp. 326-337) prove that under efficient rationing the Nash equilibrium coincides with the Cournot equilibrium. We extend the model to include asymmetric costs and provide new results showing that the capacity choice game is dominance-solvable, just like the Cournot game. Further, we provide a simple sufficient condition, under which the dominance-solvable result extends to proportional rationing. The results provide new insights into the robustness of Cournot coincidence under alternate demand rationing schemes.

Cournot and Bertrand-Edgeworth competition when rivals' costs are unknown

We study a two-stage game with capacity precommitment followed by price competition where firms have incomplete information about their rival's marginal cost. The game has a Cournot outcome if and only if the lowest possible marginal cost is sufficiently high relative to the expected marginal cost.Bertrand-Edgeworth Cournot Consumer rationing Incomplete information

Subsidization to induce tipping

In binary choice games with strategic complementarities and multiple equilibria, we characterize the minimal cost subsidy program to guarantee agents play the Pareto optimal equilibrium. These subsidies are generally asymmetric, whether or not agents are identical and even if private values are anonymous.Coordination failure Strategic complementarities Tipping