Positive Self-Image over Time

This paper incorporates egocentric comparisons into a human capital accumulation model and studies the evolution of positive self image over time. The paper shows that the process of human capital accumulation together with egocentric comparisons imply that positive self image of a cohort is first increasing and then decreasing over time. Additionally, the paper finds that positive self image: (1) peaks earlier in activities where skill depreciation is higher, (2) is smaller in activities where the distribution of income is more dispersed, (3) is not a stable characteristic of an individual, and (4) is higher for more patient individuals

Making Sense of the Experimental Evidence on Endogenous Timing in Duopoly Markets

The prediction of asymmetric equilibria with Stackelberg outcomes is clearly the most frequent result in the endogenous timing literature. Several experiments have tried to validate this prediction empirically, but failed to find support for it. In contrast, these experiments find that simultaneous-move outcomes are modal and that behavior in endogenous timing games is quite heterogeneous. This paper generalizes Hamilton and Slutsky's (Hamilton, J., Slutsky, S., 1990. Endogenous timing in duopoly games: Stackelberg or Cournot equilibria. Games and Economic Behavior 2, 29-46) endogenous timing games by assuming that players are averse to inequality in payoffs. I explore the theoretical implications of inequity aversion and compare them to the empirical evidence. I find that this explanation is able to organize most of the experimental evidence on endogenous timing games. However, inequity aversion is not able to explain delay in Hamilton and Slutsky's endogenous timing games

Tacit Collusion, Fairness and Reciprocity

This paper explores the implications of fairness and reciprocity in dynamic market games. A reciprocal player responds to kind behavior of rivals with unkind actions (destructive reciprocity), while at the same time, it responds to kind behavior of rivals with kind actions (constructive reciprocity). The paper shows that for general perceptions of fairness, reciprocity facilitates collusion in dynamic market games. The paper also shows that this is a robust result. It holds when players' choices are strategic complements and strategic substitutes. It also holds under grim trigger punishments and optimal punishments

Self-Confidence and the Timing of Entry

This paper analyzes the impact of overconfidence on the timing of entry in markets, profits, and welfare. To do that the paper uses an endogenous timing model where (i) players have private information about costs and (ii) one player is overconfident and the other is rational. The paper shows that for moderate levels of self-confidence there is a unique cost-dependent equilibrium where the overconfident player has a higher ex-ante probability of entering the market before the rational player. In this equilibrium self-confidence reduces the profits of the rational player but can increase the profits of the overconfident player provided that cost asymmetries are small. Finally, we show that overconfidence reduces welfare, except when cost asymmetries are very small

A Cognitive Hierarchy Model of Behavior in Endogenous Timing Games

This paper applies the cognitive hierarchy model of Camerer, Ho and Chong (2004) to the action commitment game of Hamilton and Slutsky (1990). The model generates the heterogeneity of behavior reported in Huck, Müeller and Normann (2002). The model predicts the spike in the leadership quantity in the first period as well as the spike in the Cournot quantity in the second period. The model predicts delay, a feature that cannot be explained by social preferences. The also model predicts very well the percentage of Stackelberg outcomes, double leadership outcomes, and Stackelberg leaders punished by followers. Notwithstanding, the model produces low first period movement and is unable to generate sufficient percentages of sequential play of Cournot quantities and collusive market outcomes

A cognitive hierarchy model of behavior in the action commitment game

We apply the cognitive hierarchy model of Camerer et al. (Q J Econ 119(3):861-898, 2004)-where players have different levels of reasoning-to Huck et al. (Games Econ Behav 38:240-264, 2002) discrete version of Hamilton and Slutsky (Games Econ Behav 2:29-46, 1990) action commitment game-a duopoly with endogenous timing of entry. We show that, for an empirically reasonable average number of thinking steps, the model rules out Stackelberg equilibria, generates Cournot outcomes including delay, and outcomes where the first mover commits to a quantity higher than Cournot but lower than Stackelberg leader. We show that a cognitive hierarchy model with quantal responses can explain the most important features of the experimental data on the action commitment game in (2002). In order to gauge the success of the model in fitting the data, we compare it to a noisy Nash model. We find that the cognitive hierarchy model with quantal responses fits the data better than the noisy Nash model

Bank strategic asset allocation under a unified risk measure

Most available bank asset allocation models use several risk measures as constraints; as a consequence, the comparison of the risk between different asset allocation strategies is often difficult, since each strategy is subject to several risks. With this research, we create a simulation–optimization methodology that measures interest rate, credit and liquidity risks in a unified manner. The associated risk events, such as interest rate increases, liquidity outflows or spikes in defaults are generated using the same simulation engine, giving as output a single risk measure (the probability of failure, used by ratings agencies) that aggregates those risks under the same simulation engine. Finally, we use our methodology to determine Pareto fronts for the optimal balance sheet allocations and minimum-risk strategies. As a result, several findings emerge, such as: 1) Risk is dependent on the income stream; 2) Allocation to book value assets is preferable; 3) Under low rate environments, a full allocation to cash is very risky and is not the minimum risk strategy; 4) Banks can make investments in stocks in environments of high prospective returns and low leverage.info:eu-repo/semantics/acceptedVersio

The extracellular small leucine-rich proteoglycan biglycan is a key player in gastric cancer aggressiveness

Biglycan (BGN gene), an extracellular proteoglycan, has been described to be associated with cancer aggressiveness. The purpose of this study was to clarify the clinical value of biglycan as a biomarker in multiple independent GC cohorts and determine the in vitro and in vivo role of biglycan in GC malignant features. We found that BGN is commonly over-expressed in all analyzed cohorts, being associated with disease relapse and poor prognosis in patients with advanced stages of disease. In vitro and in vivo experiments demonstrated that biglycan knock-out GC cells display major phenotypic changes with a lower cell survival, migration, and angiogenic potential when compared with biglycan expressing cells. Biglycan KO GC cells present increased levels of PARP1 and caspase-3 cleavage and a decreased expression of mesenchymal markers. Importantly, biglycan deficient GC cells that were supplemented with exogenous biglycan were able to restore biological features, such as survival, clonogenic and migratory capacities. Our in vitro and in vivo findings were validated in human GC samples, where BGN expression was associated with several oncogenic gene signatures that were associated with apoptosis, cell migration, invasion, and angiogenesis. This study provided new insights on biglycan role in GC that should be taken in consideration as a key cellular regulator with major impact in tumor progression and patients’ clinical outcome.This work was funded by FEDER funds through the Operational Programme for Competitiveness Factors-COMPETE (POCI-01-0145-FEDER-016585; POCI-01-0145-FEDER-029780; POCI-01-0145-FEDER-007274; POCI-01-0145-FEDER-029780) and National Funds through the Foundation for Science and Technology (FCT), under the projects: PTDC/BBB-EBI/0567/2014 (to C.A.R.), PTDC/MED-QUI/29780/2017 (to CG), and UID/BIM/04293 supported by Norte Portugal Regional Programme (NORTE 2020), under the PORTUGAL 2020 Partnership Agreement, through the European Regional Development Fund (ERDF). F.P. was funded by FCT cofinanced by Fundo Social Europeu-FSE with a grant with reference: SFRH/BPD/115730/2016

Labor Market Signaling and Self-Confidence: Wage Compression and the Gender Pay Gap (This paper replaces Nr 10.07 "Labor Market Signaling with Overconfident Workers", June 2010)

I extend Spence's (1973) signaling model by assuming some workers are overconfident - they underestimate their marginal cost of acquiring education - and some are underconfident. Firms cannot observe workers' productive abilities and beliefs but know the fractions of high-ability, overconfident, and underconfident workers. I find that biased beliefs lower the wage spread and compress the wages of unbiased workers. I show that gender differences in self-confidence can contribute to the gender pay gap. If education raises productivity, men are overconfident, and women underconfident, then women will, on average, earn less than men. Finally, I show that biased beliefs can improve welfare

The motion of two masses coupled to a massive spring

We discuss the classical motion of a spring of arbitrary mass coupled to two arbitrary massive blocks attached at its ends. A general approach to the problem is presented and some general results are obtained. Examples for which a simple elastic function can be inferred are discussed and the normal modes and normal frequencies obtained. An approximation procedure to the evaluation of the normel frequencies in the case of uniform elastic function and mass density is also discussed.Comment: Standard Latex file plus three eps figure