Government R&D Subsidies as a Signal for Private Investors

Government subsidies for R&D are intended to promote projects with high returns to society but too little private returns to be beneficial for private investors. This may be caused by spillovers or a low appropriability rate. Apart from the direct funding of these projects, government grants may serve as a signal for good investments for private investors. We use a simple signaling model with different types of R&D projects to capture this phenomenon. In a setup where the subsidy can only be used to distinguish between high and low risk projects, government agency’s signal is not very helpful for banks. However, if the subsidy is accompanied by a quality signal, it can lead to increased or better selected private investments.Subsidies, Innovation, Asymmetric Information, Signaling

The Effect of Mergers on the Incentive to Invest in Cost Reducing Innovations

Both mergers and innovation are central elements of a firm?s competitive strategy. However, model-theoretical analyses of the merger-innovation link is sparse. The aim of this paper is to analyze the impact of mergers on innovative activities and product market competition in the context of incremental process innovations. Inefficiencies due to organizational problems of mergers are accounted for. We show that optimal investment strategies depend on the resulting market structure and differ significantly from insider to outsider. In our linear model mergers turn out to increase social surplus. --Horizontal mergers,innovation,research joint venture,market structure

The Effect of Mergers on the Incentive to Invest in Cost Reducing Innovations

Both mergers and innovation are central elements of a firm’s competitive strategy. However, model-theoretical analysis of the merger-innovation link is sparse. The aim of this paper is to analyze the impact of mergers on innovative activities and product market competition in the context of incremental process innovations. Inefficiencies due to organizational problems of mergers are accounted for. We show that optimal investment strategies depend on the resulting market structure and differ significantly from insider to outsider. In our linear model mergers turn out to increase social surplus.Horizontal mergers, innovation, research joint venture, market structure

Tight Inefficiency Bounds for Perception-Parameterized Affine Congestion Games

Congestion games constitute an important class of non-cooperative games which was introduced by Rosenthal in 1973. In recent years, several extensions of these games were proposed to incorporate aspects that are not captured by the standard model. Examples of such extensions include the incorporation of risk sensitive players, the modeling of altruistic player behavior and the imposition of taxes on the resources. These extensions were studied intensively with the goal to obtain a precise understanding of the inefficiency of equilibria of these games. In this paper, we introduce a new model of congestion games that captures these extensions (and additional ones) in a unifying way. The key idea here is to parameterize both the perceived cost of each player and the social cost function of the system designer. Intuitively, each player perceives the load induced by the other players by an extent of {\rho}, while the system designer estimates that each player perceives the load of all others by an extent of {\sigma}. The above mentioned extensions reduce to special cases of our model by choosing the parameters {\rho} and {\sigma} accordingly. As in most related works, we concentrate on congestion games with affine latency functions here. Despite the fact that we deal with a more general class of congestion games, we manage to derive tight bounds on the price of anarchy and the price of stability for a large range of pa- rameters. Our bounds provide a complete picture of the inefficiency of equilibria for these perception-parameterized congestion games. As a result, we obtain tight bounds on the price of anarchy and the price of stability for the above mentioned extensions. Our results also reveal how one should "design" the cost functions of the players in order to reduce the price of anar- chy

Europa's Optical Aurora

Auroral emissions provide opportunities to study the tenuous atmospheres of Solar System satellites, revealing the presence and abundance of molecular and atomic species as well as their spatial and temporal variability. Far-UV aurorae have been used for decades to study the atmospheres of the galilean satellites. Here we present the first detection of Europa's visible-wavelength atomic oxygen aurora at 6300/6364 \AA{} arising from the metastable O$(^1$D) state, observed with the Keck I and Hubble Space Telescopes while Europa was in eclipse by Jupiter on six occasions in February-April 2018. The disk-integrated O($^1$D) brightness varies from $<$500 R up to more than 2 kR between dates, a factor of 15 higher than the OI 1356 \AA{} brightness on average. The ratio of emission at 6300/5577 \AA{} is diagnostic of parent molecule; the 5577 \AA{} emission was not detected in our dataset, which favors O$_2$ as the dominant atmospheric constituent and rules out an O/O$_2$ mixing ratio above 0.35. For an O$_2$ atmosphere and typical plasma conditions at Europa's orbit, the measured surface brightness range corresponds to column densities of 1-9$\times$10$^{14}$ cm$^{-2}$

Czy Polska ma szansę na gospodarkę opartą na wiedzy?

This article consists of four parts. In the first part, attention is drawn to an approach towards the problems of a knowledge-based economy (KBE) and economic or social progress, and in the second part three definitions are presented: one based on an enterprise, one based on a macroeconomic aspect, and one based on a social approach, with a discussion of the controversies and disputes that bind these concepts. The first area of the dispute is contained within a microeconomic aspect and involves the question of cooperation in the creation and dissemination of knowledge vis-a-vis competition and the values created by the market, to which knowledge is also subject. The second area of controversies involves an answer to the question: Is a KBE an extension of industrial civilisation, or does it represent the beginning of a new post-industrial civilisation? In this context, the article presents six qualities that characterise a KBS, after which it considers whether Poland is ripe for this type of economy and examines the country’s situation in the light of the characteristics of a KBE and the progress attained by EU countries along the road to such an economy. In the final part of the article, a summary of the Author’s thinking is given, providing two possible answers depending on the points of reference he discussed previously.Artykuł składa się z czterech części. W pierwszej Autor zwraca uwagę na podejście do problematyki gospodarki opartej na wiedzy jako procesu ekonomicznego lub cywilizacyjnego, w drugiej przedstawia trzy definicje: wychodzącą od przedsiębiorstwa, wynikającą z ujęcia makroekonomicznego oraz wynikającą z podejścia cywilizacyjnego, a także łączące się z tymi ujęciami kontrowersje i spory. Pierwszy obszar sporu rysuje się w ujęciu mikroekonomicznym, wiążąc się z kwestią współpracy w procesie tworzenia i upowszechniania wiedzy versus konkurencji oraz wartości kreowanych przez rynek, któremu podlega także wiedza. Drugi obszar kontrowersji dotyczy odpowiedzi na pytanie, czy gospodarka oparta na wiedzy jest przedłużeniem cywilizacji przemysłowej, czy też początkiem nowej cywilizacji postindustrialnej. W tym kontekście Autor przedstawia sześć cech charakteryzujących gospodarkę opartą na wiedzy, by następnie postawić pytanie o stopień dojrzałości Polski do tego rodzaju gospodarki oraz ocenić sytuację Polski w świetle charakterystycznych cech gospodarki opartej na wiedzy, a także poziomu zaawansowania krajów Unii Europejskiej w dążeniu do takiej gospodarki. W ostatniej części artykułu Autor podsumowuje swój wywód, udzielając dwóch możliwych odpowiedzi w zależności od omówionych wcześniej układów odniesienia

Sampling from the {G}ibbs Distribution in Congestion Games

Logit dynamics is a form of randomized game dynamics where players have a bias towards strategic deviations that give a higher improvement in cost. It is used extensively in practice. In congestion (or potential) games, the dynamics converges to the so-called Gibbs distribution over the set of all strategy profiles, when interpreted as a Markov chain. In general, logit dynamics might converge slowly to the Gibbs distribution, but beyond that, not much is known about their algorithmic aspects, nor that of the Gibbs distribution. In this work, we are interested in the following two questions for congestion games: i) Is there an efficient algorithm for sampling from the Gibbs distribution? ii) If yes, do there also exist natural randomized dynamics that converges quickly to the Gibbs distribution? We first study these questions in extension parallel congestion games, a well-studied special case of symmetric network congestion games. As our main result, we show that there is a simple variation on the logit dynamics (in which we in addition are allowed to randomly interchange the strategies of two players) that converges quickly to the Gibbs distribution in such games. This answers both questions above affirmatively. We also address the first question for the class of so-called capacitated $k$-uniform congestion games. To prove our results, we rely on the recent breakthrough work of Anari, Liu, Oveis-Gharan and Vinzant (2019) concerning the approximate sampling of the base of a matroid according to strongly log-concave probability distribution