Individual Rationality and Market Efficiency

The demonstration by Smith [1962] that prices and allocations quickly converge to the competitive equilibrium in the continuous double auction (CDA) was one of the first – and remains one of the most important results in experimental economics. His initial experiment, subsequent market experiments, and models of price adjustment and exchange have added considerably to our knowledge of how markets reach equilibrium, and how they respond to disruptions. Perhaps the best known model of exchange in CDA market experiments is the random behavior in the “zero-intelligence” (ZI) model by Gode and Sunder [1993]. They conclude that even without trader rationality the CDA generates efficient allocations and “convergence of transaction prices to the proximity of the theoretical equilibrium price,” provided only that agents meet their budget constraints. We demonstrate that – by any reasonable measure – prices don’t converge in their simulations. Their budget constraint requires that a buyer’s currency never exceeds her value for the commodity, which is an unnatural restriction. Their conclusion that market efficiency results from the structure of the CDA independent of traders’ profit seeking behavior rests on their claim that the constraints that they impose are a part of the market institution, but this is not so. We show that they in effect impose individual rationality, which is an aspect of agents' behavior. Researchers on learning in markets have been misled by their interpretation of the ZI simulations, with deleterious effects on the debate on market adjustment processes.Bounded rationality; double auction; exchange economy; experimental economics; market experiment; "zero intelligence" model

The Opioid Receptor Mu 1 (OPRM1) rs1799971 and Catechol-O-methyltransferase (COMT) rs4680 as genetic markers for placebo analgesia

This is the accepted manuscript version of the following article: Aslaksen, P.M., Forsberg, J.T. & Gjerstad, J. (2018). The Opioid Receptor Mu 1 (OPRM1) rs1799971 and Catechol-O-methyltransferase (COMT) rs4680 as genetic markers for placebo analgesia. Pain. https://doi.org/10.1097/j.pain.0000000000001370. Published version available at https://doi.org/10.1097/j.pain.0000000000001370.The placebo effect is considered the core example of mind-body interactions. However, individual differences produce large placebo response variability in both healthy volunteers and patients. The placebo response in pain, placebo analgesia, may be dependent on both the opioid system and the dopaminergic system. Previous studies suggest that genetic variability affects the function of these 2 systems. The aim of this study was therefore to address the interaction between the single nucleotide polymorphisms opioid receptor mu 1 (OPRM1) rs1799971 and catechol-O-methyltransferase (COMT) rs4680 on placebo analgesia. Two hundred ninety-six healthy volunteers participated in a repeated-measures experimental design where thermal heat pain stimuli were used as pain stimuli. Participants were randomized either to a placebo group receiving placebo cream together with information that the cream would reduce pain, or to a natural history group receiving the same pain stimuli as the placebo group without any application of cream or manipulation of expectation of pain levels. The results showed that the interaction between OPRM1 rs1799971 and COMT rs4680 was significantly associated with the placebo analgesic response. Participants with OPRM1 Asn/Asn combined with COMT Met/Met and Val/Met reported significant pain relief after placebo administration, whereas those with other combinations of the OPRM1 and COMT genotypes displayed no significant placebo effect. Neither OPRM1 nor COMT had any significant influence on affective changes after placebo administration. As shown in this study, genotyping with regard to OPRM1 and COMT may predict who will respond favorably to placebo analgesic treatment

Climate change lifestyle narratives among Norwegian citizens: A linguistic analysis of survey discourse

The present study proposes an analysis of climate change (CC) narratives in answers to an open-ended survey question, where we ask what a climate-friendly lifestyle may imply. The representative survey has been conducted online by the Norwegian Citizen Panel/DIGSSCORE, located at the University of Bergen. The survey provided 1,149 answers from respondents across Norway. The analysis combines a lexical and a text linguistic approach (Fløttum & Gjerstad, 2017), based on Adam's (2008) analysis of the narrative text sequence (initial situation–complication–(re)action–resolution–final situation), and inspired by the Narrative Policy Framework's (NPF) notions of plot and narrative characters (Jones et al., 2014). Our analysis identified four main topics: consumption, transportation, politics, and energy, while the cast of characters is dominated by the first-person singular, frequently portrayed as hero, and the first-person plural in a predominantly villainous role. The frequent use of negation and argumentative connectives reflects the contentious nature of the issue.publishedVersio

Adaptive-Aggressive Traders Don't Dominate

For more than a decade Vytelingum's Adaptive-Aggressive (AA) algorithm has been recognized as the best-performing automated auction-market trading-agent strategy currently known in the AI/Agents literature; in this paper, we demonstrate that it is in fact routinely outperformed by another algorithm when exhaustively tested across a sufficiently wide range of market scenarios. The novel step taken here is to use large-scale compute facilities to brute-force exhaustively evaluate AA in a variety of market environments based on those used for testing it in the original publications. Our results show that even in these simple environments AA is consistently out-performed by IBM's GDX algorithm, first published in 2002. We summarize here results from more than one million market simulation experiments, orders of magnitude more testing than was reported in the original publications that first introduced AA. A 2019 ICAART paper by Cliff claimed that AA's failings were revealed by testing it in more realistic experiments, with conditions closer to those found in real financial markets, but here we demonstrate that even in the simple experiment conditions that were used in the original AA papers, exhaustive testing shows AA to be outperformed by GDX. We close this paper with a discussion of the methodological implications of our work: any results from previous papers where any one trading algorithm is claimed to be superior to others on the basis of only a few thousand trials are probably best treated with some suspicion now. The rise of cloud computing means that the compute-power necessary to subject trading algorithms to millions of trials over a wide range of conditions is readily available at reasonable cost: we should make use of this; exhaustive testing such as is shown here should be the norm in future evaluations and comparisons of new trading algorithms.Comment: To be published as a chapter in "Agents and Artificial Intelligence" edited by Jaap van den Herik, Ana Paula Rocha, and Luc Steels; forthcoming 2019/2020. 24 Pages, 1 Figure, 7 Table

Q-Strategy: A Bidding Strategy for Market-Based Allocation of Grid Services

The application of autonomous agents by the provisioning and usage of computational services is an attractive research field. Various methods and technologies in the area of artificial intelligence, statistics and economics are playing together to achieve i) autonomic service provisioning and usage of Grid services, to invent ii) competitive bidding strategies for widely used market mechanisms and to iii) incentivize consumers and providers to use such market-based systems. The contributions of the paper are threefold. First, we present a bidding agent framework for implementing artificial bidding agents, supporting consumers and providers in technical and economic preference elicitation as well as automated bid generation by the requesting and provisioning of Grid services. Secondly, we introduce a novel consumer-side bidding strategy, which enables a goal-oriented and strategic behavior by the generation and submission of consumer service requests and selection of provider offers. Thirdly, we evaluate and compare the Q-strategy, implemented within the presented framework, against the Truth-Telling bidding strategy in three mechanisms – a centralized CDA, a decentralized on-line machine scheduling and a FIFO-scheduling mechanisms

Learning to trade in an unbalanced market

We study the evolution of trading strategies in double auctions as the size of the market gets larger. When the number of buyers and sellers is balanced, Fano et al.~(2011) show that the choice of the order-clearing rule (simultaneous or asynchronous) steers the emergence of fundamentally different strategic behavior. We extend their work to unbalanced markets, confirming their main result as well as that allocative inefficiency tends to zero. On the other hand, we discover that convergence to the competitive outcome takes place only when the market is large and that the long side of the market is more effective at improving its disadvantaged terms of trade under asynchronous order-clearing

The cellular and synaptic architecture of the mechanosensory dorsal horn

The deep dorsal horn is a poorly characterized spinal cord region implicated in processing low-threshold mechanoreceptor (LTMR) information. We report an array of mouse genetic tools for defining neuronal components and functions of the dorsal horn LTMR-recipient zone (LTMR-RZ), a role for LTMR-RZ processing in tactile perception, and the basic logic of LTMR-RZ organization. We found an unexpectedly high degree of neuronal diversity in the LTMR-RZ: seven excitatory and four inhibitory subtypes of interneurons exhibiting unique morphological, physiological, and synaptic properties. Remarkably, LTMRs form synapses on between four and 11 LTMR-RZ interneuron subtypes, while each LTMR-RZ interneuron subtype samples inputs from at least one to three LTMR classes, as well as spinal cord interneurons and corticospinal neurons. Thus, the LTMR-RZ is a somatosensory processing region endowed with a neuronal complexity that rivals the retina and functions to pattern the activity of ascending touch pathways that underlie tactile perception

Prospective study comparing skin impedance with EEG parameters during the induction of anaesthesia with fentanyl and etomidate

<p>Abstract</p> <p>Objective</p> <p>Sympathetic stimulation leads to a change in electrical skin impedance. So far it is unclear whether this effect can be used to measure the effects of anaesthetics during general anaesthesia. The aim of this prospective study is to determine the electrical skin impedance during induction of anaesthesia for coronary artery bypass surgery with fentanyl and etomidate.</p> <p>Methods</p> <p>The electrical skin impedance was measured with the help of an electro-sympathicograph (ESG). In 47 patients scheduled for elective cardiac surgery, anaesthesia was induced with intravenous fentanyl 10 μg/kg and etomidate 0.3 mg/kg. During induction, the ESG (Electrosympathicograph), BIS (Bispectral IndeX), BP (arterial blood pressure) and HR (heart rate) values of each patient were recorded every 20 seconds. The observation period from administration of fentanyl to intubation for surgery lasted 4 min.</p> <p>Results</p> <p>The ESG recorded significant changes in the electrical skin impedance after administration of fentanyl and etomidate(p < 0.05). During induction of anaesthesia, significant changes of BIS, HR and blood pressure were observed as well (p < 0.05).</p> <p>Conclusions</p> <p>The electrical skin impedance measurement may be used to monitor the effects of anesthetics during general anaesthesia.</p

How do markets manage water resources? An experiment

We experimentally test how a private monopoly, a duopoly and a public utility allocate water of differing qualities to households and farmers. Most of our results are in line with the theoretical predictions. Overexploitation of the resources is observed independently of the market structure. Stock depletion for the public utility is the fastest, followed by the private duopoly and private monopoly. On the positive aspects of centralized public management, we find that the average quality to price ratio offered by the public monopoly is substantially higher than that offered by the private monopoly or duopoly