Learning, Cascades and Transaction Costs

This paper analyzes the effect of transaction costs on the social learning in an asset market with asymmetric information, sequential trading and competitive price mechanism. Both fixed and proportional transaction costs reduce the informational content of trading orders and lead to informational cascades. If transaction costs are very high, an informational cascade can occur not only when beliefs converge to a specific asset value, but also when in the market there is complete uncertainty about the asset's fundamental value. Finally, if the asset value in the bad state is sufficiently low, proportional transaction costs lead to an informational cascade only when prices are very high.

Institutional Trades and Herd Behavior in Financial Markets

The article studies the impact of transaction costs on the trading strategy of informed institutional investors in a sequential trading market where traders can choose to transact a large or a small amount of the stock. The analysis shows that high transaction costs may induce informed investors to herd. Moreover, for low levels of transaction costs, informed investors trade both the large and the small quantity of the asset. Finally, if transaction costs are very low and the market width is large enough, informed traders prefer to separate from small liquidity traders.

Transaction Costs and the Asymmetric Price Impact of Block Trades

The article examines the impact of transaction costs on the trading strategy of informed institutional investors in a sequential trading market where traders can choose to transact a large or a small amount of stock. The analysis shows how the trading strategy of informed investors and the price impact of their trades depends on market conditions. The main prediction of the model is that institutional buyers are, on average, more aggressive than institutional sellers in bearish markets and less aggressive in bullish markets. Hence, the price impact is higher for purchases when market conditions are bearish, while it is higher for sales when market conditions are bullish. However, this asymmetry vanishes during strongly bearish or bullish phases, when information-based orders stop because the informational advantage of institutional investors becomes too small with respect to the transaction costs

Tumour prevention and tumour progression: a dual role for statins?☆

www.sciencedirect.com The use of statins is essential for the treatment of hyperlipidemia as well as for the primary and secondary prevention of coronary artery disease and strokes. Statins decrease low-density lipoprotein (LDL) cholesterol levels by inhibiting 3-hydroxy-3-methyl-glutaryl-CoA HMG-CoA reductase (HMGCR). HMGCR in turn catalyses the conversion of HMG-CoA into mevalonic acid, an important intermediate metabolite in hepatic cholesterol biosynthesis. Statins exert pleiotropic effects independent of their cholesterol-lowering activity, which are in part mediated by mevalonic acid, a precursor of the isoprenoid intermediates farnesyl and geranyl-geranyl pyrophosphate [1]. These compounds participate in the post-translational modification of intracellular G-proteins, such as Rho, Rac, and Ras. In turn, it is well-known that G-proteins drive signalling pathways that are widely involved in carcinogenesis [2], and their inhibition by statins has been proven to efficiently impair the growth of several tumours [3]. Furthermore, statins inhibit cellular matrix metalloproteinases and nuclear factor-kB (NFkB) transcription factors that are, additionally, often deregulated in cancer. A large body of studies exists that support the efficacy of statins against several cancer types [3]. For this reason, these compounds has been proposed as adjuvant options in cancer therapies and in cancer prevention. Currently, recommendations and guidelines on statin use in malignancies do not exist; in addition, to date, results from randomised controlled trials are inconclusive regarding the question of whether cancer treatment may benefit from statins

A Simple Impossibility Result in Behavioral Contract Theory

The paper analyses, within a moral hazard scenario, a contract between an agent with anticipatory emotions and a principal who responds strategically to those emotions. The agent receives a private signal on the profitability of the task he was hired for. If the signal is informative about the return from effort, the agent would benefit from knowing accurate news. However, if the agent derives utility from the anticipation of his final payoff, the suppression of a bad signal may induce a positive interim emotional effect. We show that it may be impossible to achieve the first-best, even though the risk-neutral parties are symmetrically informed at the contracting stage and complete contracts can be written.Hidden action, anticipatory utility.

Conditional Cash Transfers and Their Effect on Poverty, Inequality, and School Enrollment: The Case of Mexico and Latin America

Over the past two decades, conditional cash transfer (CCT) has become one of the most widespread approaches to social development in Latin America. Spurred in large part by the evident and immediate success of Mexico’s CCT initiative, a multitude of countries began to invest heavily in this strategy hoping to reduce poverty and inequality in the short and long run. This paper examines the relationship between CCT program breadth and poverty, inequality, and secondary school enrollment over a thirteen year span in order to determine whether or not programs with the largest coverage were the most efficient. This question is of grave importance being that as many as eighteen countries are betting on CCT as a means in sustainably breaking poverty cycles. This thesis finds that conditional cash transfer has been exceptionally successful in diminishing extreme poverty in Latin America. Furthermore, although result are inconclusive in terms of moderate poverty, secondary school enrollment, and inequality a trend analysis of fluctuations in poverty and inequality from 1997 to 2010 shows promising results as all development indicators appear to be in decline

Leptomeningitis in a person with radiologically isolated syndrome and latent tuberculosis. A case report with implications for clinical research

A 39-year-old man, followed with serial MRI of CNS for a radiologically isolate syndrome (RIS, a recently described condition considered a subclinical form of MS), was hospitalized for the occurrence of a leptomeningitis. Routine blood tests and contrast enhanced total body CT scan were unremarkable. Cerebrospinal fluid (CSF) examination showed increase of cells (22 mononuclear cells/mm3), albumin (294 mg/L), immunoglobilins G (161 mg/L) and Link Index (1.9), with 17 oligoclonal bands. Microbiological examinations of CSF (including those for Koch’s Bacillus) were negative. The Mantoux reaction and the QuantiFERON test were positive, featuring a latent tuberculosis (TB). The patient started prophylaxis with rifampicin and isoniazid for four months, until a new MRI showed the disappearance of the leptomeningeal enhancement, and the stability of white matter brain and spinal cord lesions. Two other MRI scans showed a new brain Gd-enhancing lesion nine month after anti-tubercular therapy and, after additional six months, new cerebral and spinal cord areas. This case provides the following suggestions about the effects of TB infection and related therapies on the underlying autoimmune status: the infection, while actively present, did not exacerbate the RIS condition; the worsening nine months after the prophylaxis discontinuation might have been the ‘natural’ evolution of RIS condition. Alternative speculative hypotheses include a remote effect of the infection, of isoniazid (that was reported in some cases to trigger MS), or the result of the clearance of the infection itself. Irrespective of the existence of any interaction between RIS and TB infection, It seems important to collect cases with MS-related diseases and concomitant infections, that may provide clues about disease pathogenesis and treatment