Scientific Realism

This article endeavors to identify the strongest versions of the two primary arguments against epistemic scientific realism: the historical argument—generally dubbed “the pessimistic meta-induction”—and the argument from underdetermination. It is shown that, contrary to the literature, both can be understood as historically informed but logically validmodus tollensarguments. After specifying the question relevant to underdetermination and showing why empirical equivalence is unnecessary, two types of competitors to contemporary scientific theories are identified, both of which are informed by science itself. With the content and structure of the two nonrealist arguments clarified, novel relations between them are uncovered, revealing the severity of their collective threat against epistemic realism and its “no-miracles” argument. The final section proposes, however, that the realist’s axiological tenet “science seeks truth” is not blocked. An attempt is made to indicate the promise for a nonepistemic, purely axiological scientific realism—here dubbed “Socratic scientific realism.

Structural realism versus deployment realism: A comparative evaluation

In this paper I challenge and adjudicate between the two positions that have come to prominence in the scientific realism debate: deployment realism and structural realism. I discuss a set of cases from the history of celestial mechanics, including some of the most important successes in the history of science. To the surprise of the deployment realist, these are novel predictive successes toward which theoretical constituents that are now seen to be patently false were genuinely deployed. Exploring the implications for structural realism, I show that the need to accommodate these cases forces our notion of “structure” toward a dramatic depletion of logical content, threatening to render it explanatorily vacuous: the better structuralism fares against these historical examples, in terms of retention, the worse it fares in content and explanatory strength. I conclude by considering recent restrictions that serve to make “structure” more specific. I show however that these refinements will not suffice: the better structuralism fares in specificity and explanatory strength, the worse it fares against history. In light of these case studies, both deployment realism and structural realism are significantly threatened by the very historical challenge they were introduced to answer

Using Taint Analysis and Reinforcement Learning (TARL) to Repair Autonomous Robot Software

It is important to be able to establish formal performance bounds for autonomous systems. However, formal verification techniques require a model of the environment in which the system operates; a challenge for autonomous systems, especially those expected to operate over longer timescales. This paper describes work in progress to automate the monitor and repair of ROS-based autonomous robot software written for an a-priori partially known and possibly incorrect environment model. A taint analysis method is used to automatically extract the data-flow sequence from input topic to publish topic, and instrument that code. A unique reinforcement learning approximation of MDP utility is calculated, an empirical and non-invasive characterization of the inherent objectives of the software designers. By comparing off-line (a-priori) utility with on-line (deployed system) utility, we show, using a small but real ROS example, that it's possible to monitor a performance criterion and relate violations of the criterion to parts of the software. The software is then patched using automated software repair techniques and evaluated against the original off-line utility.Comment: IEEE Workshop on Assured IEEE Workshop on Assured Autonomous Systems, May, 202

Many people never switch telecoms provider; what is different about switchers? ESRI Research Bulletin 2018/7

Many consumers have never switched telecoms company, despite the efforts of regulators to encourage shopping around and to make switching easier. A significant number of consumers need to be willing to compare offers and to consider switching to better ones if the benefits of competition are going to be spread more widely. In particular, if there are identifiable groups of consumers who are unlikely to consider switching, they may end up with worse deals than other consumers. This research investigated which consumers are more inclined to switch providers of broadband, mobile phone and landline services. It looked not only at individual characteristics like age, family structure and income, but also at characteristics of the service and how it is used, such as whether it is ‘bundled’ or whether people in the household use smart phones to browse the internet. The study also recorded how much money people think they might save by switching and whether people had experienced ‘bill-shock’ (an unexpectedly high bill)

Are Different-Currency Assets Imperfect Substitutes?

This paper provides a new test for whether different-currency assets are imperfect substitutes. Past work on imperfect substitutability in foreign exchange falls into two groups: (1) tests using measures of asset supply and (2) tests using measures of central-bank asset demand. We address the demand side, but we use a broad measure of public demand rather than focusing on demand by central banks. Under floating rates, changing public demand has no direct effect on monetary fundamentals, current or future. This provides an opportunity to test for price effects from imperfect substitutability. We develop and estimate a micro portfolio balance model that has both Walrasian and microstructure features. Price effects from imperfect substitutability are clearly present: the immediate price impact of public trades is 0.44 percent per $1 billion (of which, about 80 percent persists indefinitely). This estimate is applicable to intervention trades in the special case when they are indistinguishable from private trades (i.e., when interventions are sterilized, anonymous, and provide no monetary-policy signal).

Portfolio Balance, Price Impact, and Secret Intervention

This paper tests the portfolio-balance approach to exchange rate determination in a new way. Past work on portfolio balance in foreign exchange falls into two groups: (1) tests using measures of asset supply and (2) tests using measures of central-bank asset demand. We address the demand side, but we use a broad measure of public demand, rather than focusing on demand by central banks. Under floating rates, changing public demand has no direct effect on interest rates, current or future. This provides an opportunity to test for portfolio-balance effects on price. We develop and estimate a micro portfolio-balance model that has both Walrasian and microstructure features. Portfolio-balance effects are clearly present: the immediate price impact of public trades is 0.44 percent per $1 billion (of which, about 80 percent persists indefinitely). This estimate is applicable to central-bank trades as well, as long as they are sterilized, secret, and provide no monetary-policy signal. Intervention of this type is most effective when the flow of macroeconomic news is strong.

Are Different-Currency Assets Imperfect Substitutes?

This paper provides a new test for whether different-currency assets are imperfect substitutes. The test exploits that under floating rates, changing public currency demand has no direct effect on monetary fundamentals, current or future. Price effects from imperfect substitutability are clearly present: the immediate price impact of public trades is 0.44 percent per 1 billion dollar (of which, about 80 percent persists indefinitely). This estimate is applicable to intervention trades in the special case when they are indistinguishable from private trades (i.e., when interventions are sterilized, anonymous, and provide no monetary-policy signal).

Exchange Rate Fundamentals and Order Flow

We address whether transaction flows in foreign exchange markets convey fundamental information. Our GE model includes fundamental information that first manifests at the micro level and is not symmetrically observed by all agents. This produces foreign exchange transactions that play a central role in information aggregation, providing testable links between transaction flows, exchange rates, and future fundamentals. We test these links using data on all end-user currency trades received at Citibank over 6.5 years, a sample sufficiently long to analyze real-time forecasts at the quarterly horizon. The predictions are borne out in four empirical findings that define this paper's main contribution: (1) transaction flows forecast future macro variables such as output growth, money growth, and inflation, (2) transaction flows forecast these macro variables significantly better than the exchange rate does, (3) transaction flows (proprietary) forecast future exchange rates, and (4) the forecasted part of fundamentals is better at explaining exchange rates than standard measured fundamentals.

Stochastic Differential Equations Driven by Fractional Brownian Motion and Standard Brownian Motion

We prove an existence and uniqueness theorem for solutions of multidimensional, time dependent, stochastic differential equations driven simultaneously by a multidimensional fractional Brownian motion with Hurst parameter H>1/2 and a multidimensional standard Brownian motion. The proof relies on some a priori estimates, which are obtained using the methods of fractional integration, and the classical Ito stochastic calculus. The existence result is based on the Yamada-Watanabe theorem.Comment: 21 page