Financial innovation, strategic real options and endogenous competition : theory and an application to Internet banking

Innovations in financial services continuously influence the scope of financial intermediation and the nature of competition between intermediaries. This paper examines the optimal exercise of strategic real options to invest in such an innovation, Internet banking technology, within a two-stage game, parameterized by the distribution of bank size and uncertainty over the profitability of investment, and empirically tests the results on a novel data set. Unlike traditional options, in which the distribution of the future value of the underlying asset is exogenous and the timing of exercise affects only the return to the option holder, the timing of the exercise of real options in a strategic context allows the option holder to manipulate the distribution of returns to all players. The value of the strategic investment option in our model, as a consequence, depends on both expected future profits as well as the variance of those profits. Expected profits to an entrant depend, in equilibrium, on its size, as measured by existing market share (concentration) or total assets, relative to its rivals. Conditional on the degree of uncertainty, larger banks should, as a consequence, exercise their options earlier than smaller banks, for purely strategic advantages, and act as market leaders in the provision of Internet banking services. Like ordinary options, however, the value of the strategic investment option to both large and small banks increases in uncertainty, implying that early exercise will be more likely the more information is available about potential demand. We test these hypotheses on investment in Internet banking services with data from a sample of 1,618 commercial banks in the tenth Federal Reserve District during 1999. Evidence indicates that relative bank size, as measured by either market share or asset size, positively influences the likelihood of entry into Internet banking, and trend-adjusted variation in income per person (a proxy for uncertainty of demand) negatively influences the likelihood of entry into Internet banking. In addition, market concentration of a bank's competitive rivals has a negative relationship with the likelihood of entering the market for Internet banking services. These relations are evident in both bivariate analysis and in multivariate logit regression analysis.Competition ; Internet ; Internet banking

Dieter Noll: Kippenberg

Berlin: Aufbau, 1979. 627 p

NA

http://archive.org/details/analysisofsymmet00pickNAN

G3-RAD and G3X-RAD: Modified Gaussian-3 (G3) and Gaussian-3X (G3X) procedures for radical thermochemistry

The G3-RAD, G3X-RAD, G3(MP2)-RAD, and G3X(MP2)-RAD, procedures, designed particularly for the prediction of reliable thermochemistry for free radicals, are formulated and their performance assessed using the G2/97 test set. The principal features of the RAD procedures include (a) the use of B3-LYP geometries and vibrational frequencies (in place of UHF and UMP2), including the scaling of vibrational frequencies so as to reproduce ZPVEs, (b) the use of URCCSD(T) [in place of UQCISD(T)] as the highest-level correlation procedure, and (c) the use of RMP (in place of UMP) to approximate basis-set-extension effects. G3-RAD and G3X-RAD are found to perform well overall with mean absolute deviations (MADs) from experiment of 3.96 and 3.65 kJ mol⁻¹, respectively, compared with 4.26 and 4.02 kJ mol⁻¹ for standard G3 and G3X. G3-RAD and G3X-RAD successfully predict heats of formation with MADs of 3.68 and 3.11 kJ mol⁻¹, respectively (compared with 3.93 and 3.60 kJ mol⁻¹ for standard G3 and G3X), and perform particularly well for radicals with MADs of 2.59 and 2.50 kJ mol⁻¹, respectively (compared with 3.51 and 3.18 kJ mol⁻¹ for standard G3 and G3X). The G3(MP2)-RAD and G3X(MP2)-RAD procedures give acceptable overall performance with mean absolute deviations from experiment of 5.17 and 4.92 kJ mol⁻¹, respectively, compared with 5.44 and 5.23 kJ mol⁻¹ for standard G3(MP2) and G3X(MP2). G3(MP2)-RAD and G3X(MP2)-RAD give improved performance over their standard counterparts for heats of formation (MADs=4.73 and 4.44 kJ mol⁻¹, respectively, versus 4.94 and 4.64 kJ mol⁻¹). G3(MP2)-RAD shows similar performance to G3(MP2) for radical heats of formation (MAD=5.10 versus 5.15 kJ mol⁻¹) while G3X(MP2)-RAD performs significantly better than G3X(MP2) (MAD=4.67 versus 5.19 kJ mol⁻¹).The authors gratefully acknowledge generous allocations of computing time on the Compaq Alphaserver of the National Facility of the Australian Partnership for Advanced Computing, Australian National University Supercomputer Facility, and the support of the Australian Research Council

Intergenerational Transmission of Reproductive Behavior during the Demographic Transition

New evidence from the Utah Population Database (updp) reveals that at the onset of the fertility transition, reproductive behavior was transmitted across generations—between women and their mothers, as well as between women and their husbands\u27 family of origin. Age at marriage, age at last birth, and the number of children ever born are positively correlated in the data, most strongly among first-born daughters and among cohorts born later in the fertility transition. Intergenerational ties, including the presence of mothers and mothers-in-law, influenced the hazard of progressing to a next birth. The findings suggest that the practice of parity-dependent marital fertility control and inter-birth spacing behavior derived, in part, from the previous generation and that the potential for mothers and mothers-in-law to help in the rearing of children encouraged higher marital fertility

Transcriptional repression by ApiAP2 factors is central to chronic toxoplasmosis

Tachyzoite to bradyzoite development in Toxoplasma is marked by major changes in gene expression resulting in a parasite that expresses a new repertoire of surface antigens hidden inside a modified parasitophorous vacuole called the tissue cyst. The factors that control this important life cycle transition are not well understood. Here we describe an important transcriptional repressor mechanism controlling bradyzoite differentiation that operates in the tachyzoite stage. The ApiAP2 factor, AP2IV-4, is a nuclear factor dynamically expressed in late S phase through mitosis/cytokinesis of the tachyzoite cell cycle. Remarkably, deletion of the AP2IV-4 locus resulted in the expression of a subset of bradyzoite-specific proteins in replicating tachyzoites that included tissue cyst wall components BPK1, MCP4, CST1 and the surface antigen SRS9. In the murine animal model, the mis-timing of bradyzoite antigens in tachyzoites lacking AP2IV-4 caused a potent inflammatory monocyte immune response that effectively eliminated this parasite and prevented tissue cyst formation in mouse brain tissue. Altogether, these results indicate that suppression of bradyzoite antigens by AP2IV-4 during acute infection is required for Toxoplasma to successfully establish a chronic infection in the immune-competent host

Sperm mobility: mechanisms of fertilizing efficiency, genetic variation and phenotypic relationship with male status in the domestic fowl, Gallus gallus domesticus

When females are sexually promiscuous, sexual selection continues after insemination through sperm competition and cryptic female choice, and male traits conveying an advantage in competitive fertilization are selected for. Although individual male and ejaculate traits are known to influence paternity in a competitive scenario, multiple mechanisms co-occur and interact to determine paternity. The way in which different traits interact with each other and the mechanisms through which their heritability is maintained despite selection remain unresolved. In the promiscuous fowl, paternity is determined by the number of sperm inseminated into a female, which is mediated by male social dominance, and by the quality of the sperm inseminated, measured as sperm mobility. Here we show that: (i) the number of sperm inseminated determines how many sperm reach the female sperm-storage sites, and that sperm mobility mediates the fertilizing efficiency of inseminated sperm, mainly by determining the rate at which sperm are released from the female storage sites, (ii) like social status, sperm mobility is heritable, and (iii) subdominant males are significantly more likely to have higher sperm mobility than dominant males. This study indicates that although the functions of social status and sperm mobility are highly interdependent, the lack of phenotypic integration of these traits may maintain the variability of male fitness and heritability of fertilizing efficiency

Periodic variations in the O-C diagrams of five pulsation frequencies of the DB white dwarf EC 20058-5234

Variations in the pulsation arrival time of five independent pulsation frequencies of the DB white dwarf EC 20058−5234 individually imitate the effects of reflex motion induced by a planet or companion but are inconsistent when considered in unison. The pulsation frequencies vary periodically in a 12.9 year cycle and undergo secular changes that are inconsistent with simple neutrino plus photon-cooling models. The magnitude of the periodic and secular variations increases with the period of the pulsations, possibly hinting that the corresponding physical mechanism is located near the surface of the star. The phase of the periodic variations appears coupled to the sign of the secular variations. The standards for pulsation-timing-based detection of planetary companions around pulsating white dwarfs, and possibly other variables such as subdwarf B stars, should be re-evaluated. The physical mechanism responsible for this surprising result may involve a redistribution of angular momentum or a magnetic cycle. Additionally, variations in a supposed combination frequency are shown to match the sum of the variations of the parent frequencies to remarkable precision, an expected but unprecedented confirmation of theoretical predictions.Web of Scienc

Candida albicans versus Candida dubliniensis: Why Is C. albicans More Pathogenic?

Candida albicans and Candida dubliniensis are highly related pathogenic yeast species. However, C. albicans is far more prevalent in human infection and has been shown to be more pathogenic in a wide range of infection models. Comparison of the genomes of the two species has revealed that they are very similar although there are some significant differences, largely due to the expansion of virulence-related gene families (e.g., ALS and SAP) in C. albicans, and increased levels of pseudogenisation in C. dubliniensis. Comparative global gene expression analyses have also been used to investigate differences in the ability of the two species to tolerate environmental stress and to produce hyphae, two traits that are likely to play a role in the lower virulence of C. dubliniensis. Taken together, these data suggest that C. dubliniensis is in the process of undergoing reductive evolution and may have become adapted for growth in a specialized anatomic niche