Organizational coordination and costly communication with boundedly rational agents

How does costly communication affect organizational coordination? This paper develops a model of costly communication based on the weakest-link game and boundedly rational agents. Solving for the stochastically stable states, we find that communication increases the possibilities for efficient coordination compared to a setting where agents cannot communicate. But as agents face a trade-off between lowering the strategic uncertainty for the group and the costs of communication, the least efficient state is still the unique stochastically stable one for many parameter values. Simulations show that this is not just a long run phenomena, the stochastically stable state is the most frequent outcome also in the short run. Making communication mandatory induces efficient coordination, whereas letting a team leader handle communication increases efficiency when the leader expects others to follow and has enough credibility. The results are broadly consistent with recent experimental evidence of communication in weakest-link games

Essays on Finance and Banking

A flurry of new regulation was passed in the wake of the financial crisis of 2007. Much remains however unknown about policies designed to prevent a repeat. In this dissertation I investigate two such regulatory approaches in financial and banking markets. In Chapter 2 I present an analysis of a revision of proxy access rules as it was mandated by Congress in the 2010 Dodd-Frank Wall Street Reform Act and subsequently implemented by the SEC in August 2010. Proxy access - the right for shareholders to nominate directors to a firm's board - lies at the heart of shareholder control and the monitoring process of management. I use the repeal of a new proxy access regime by the U.S. Court of Appeals as a natural experiment to quantify the costs and benefits associated with proxy access. The findings indicate that proxy access resulted in an increase of shareholder wealth for firms with agency issues, smaller firms, and firms where more investors qualified to make use of it. There are no valuation changes for large firms, firms without any agency issues and firms with special-interest investors. The results indicate that the market valued the empowerment of shareholders positively and calls for renewed regulatory attention to proxy access. Chapter 3 analyzes the effects from portfolio diversification and banking competition on the stability of U.S. banks during the 2008-2011 banking crisis in which more than 10% of U.S. banks ceased to exist. To do so, the analysis makes use of exogenous cross-sectional and time-series variation in states' branching restrictions, the degree of county business cycle integration, and topographic variation due to oceans and international borders that limited the potential to diversify. I find that both banking competition and portfolio diversification significantly reduced the failure probability of banks thereby providing a policy rationale to reduce the financial fragmentation of U.S. banking markets, to promote banking competition and an overall greater degree of diversification

The retention effects of unvested equity: Evidence from accelerated option vesting

We document that firms can effectively retain executives by granting deferred equity pay. We show this by analyzing a unique regulatory change (FAS 123-R) that prompted 723 firms to suddenly eliminate stock option vesting periods. This allowed CEOs to keep 33% more options when departing the firm, and we find that voluntary CEO departure rates subsequently rose from 5% to 21%. Our identification strategy exploits FAS 123-R’s almost-random timing, which was staggered by firms’ fiscal year-ends. Firms that experienced departures suffered negative stock price reactions, and responded by increasing compensation for remaining and newly hired executives

A Pure Java Parallel Flow Solver

In this paper an overview is given on the "Have Java" project to attain a pure Java parallel Navier-Stokes flow solver (JParNSS) based on the thread concept and remote method invocation (RMI). The goal of this project is to produce an industrial flow solver running on an arbitrary sequential or parallel architecture, utilizing the Internet, capable of handling the most complex 3D geometries as well as flow physics, and also linking to codes in other areas such as aeroelasticity etc. Since Java is completely object-oriented the code has been written in an object-oriented programming (OOP) style. The code also includes a graphics user interface (GUI) as well as an interactive steering package for the parallel architecture. The Java OOP approach provides profoundly improved software productivity, robustness, and security as well as reusability and maintainability. OOP allows code construction similar to the aerodynamic design process because objects can be software coded and integrated, reflecting actual design procedures. In addition, Java is the programming language of the Internet and thus Java is the programming language of the Internet and thus Java objects on disparate machines or even separate networks can be connected. We explain the motivation for the design of JParNSS along with its capabilities that set it apart from other solvers. In the first two sections we present a discussion of the Java language as the programming tool for aerospace applications. In section three the objectives of the Have Java project are presented. In the next section the layer structures of JParNSS are discussed with emphasis on the parallelization and client-server (RMI) layers. JParNSS, like its predecessor ParNSS (ANSI-C), is based on the multiblock idea, and allows for arbitrarily complex topologies. Grids are accepted in GridPro property settings, grids of any size or block number can be directly read by JParNSS without any further modifications, requiring no additional preparation time for the solver input. In the last section, computational results are presented, with emphasis on multiprocessor Pentium and Sun parallel systems run by the Solaris operating system (OS)

A Test Suite for High-Performance Parallel Java

The Java programming language has a number of features that make it attractive for writing high-quality, portable parallel programs. A pure object formulation, strong typing and the exception model make programs easier to create, debug, and maintain. The elegant threading provides a simple route to parallelism on shared-memory machines. Anticipating great improvements in numerical performance, this paper presents a suite of simple programs that indicate how a pure Java Navier-Stokes solver might perform. The suite includes a parallel Euler solver. We present results from a 32-processor Hewlett-Packard machine and a 4-processor Sun server. While speedup is excellent on both machines, indicating a high-quality thread scheduler, the single-processor performance needs much improvement

High-Precision Orientation of Three-Component Magnetic Downhole Logs

The possible benefits of measuring the magnetic flux density in three components continuously along a borehole have been recognized a long time ago by researchers who developed models and interpretation schemes for 3-component magnetic borehole data (Parker and Daniell,1979; Gallet and Courtillot, 1989).Common borehole methods provide data not allowing for an orientation with respect to a global reference, since this requires a highly accurate orienta tion system independent of the magnetic measurements. A first attempt to obtain the orientation of the sonde was made by Bosum et al. (1988) using a mechanical gyro and accelerometers. However, at that time the data quality of the gyro did not allow for a continuous 3-component measurement. Steveling et al. (2003) provide an example from the Hawaii Scientific Drilling Project (HSDP) drill hole, where directional information of magnetization was used to separate massive lavas from hyaloclastites. However, their directional analysis was limited to the inclination because information on the tool rotation around the vertical axis was not available.Here, we describe the successful development of an orientation procedure with very high resolution independent of magnetic data. Test data were acquired in the 2.5-km-deep ICDP Outokumpu Research Hole in eastern Finland (Kukkonen, 2007) with the so-called Göttinger Borehole Magnetometer (GBM). The sonde uses three fiber optic gyros (FOGs) exhibiting a small drift of 1.5°h-1 and a high resolution of 9x10-5 degrees. In combination with a built-in Förster magnetometer triplet, the GBM can record the magnetic field in three components as well as the tool orientation continuously. In the Outokumpu drill hole, errors (root mean square) were 0.14° for the inclination and 1.4° for the declination of the magnetic flux density

Earth Virtualization Engines (EVE)

To manage Earth in the Anthropocene, new tools, new institutions, and new forms of international cooperation will be required. Earth Virtualization Engines is proposed as an international federation of centers of excellence to empower all people to respond to the immense and urgent challenges posed by climate change

Geographic Diversification and Bank Stability: Evidence from the 2008-2011 U.S. Banking Crisis

This paper shows that greater bank geographic diversification leads to a sizable decline in bank failure rates. I find that during the 2008-2011 U.S.banking crisis, several measures of bank stability among U.S. banks are sensitive to an exogenous and novel measure of geographic diversification. Alternative explanations including risk-taking, competition, capital reserves or bank size cannot explain this result. Overall, geographic diversification by banks is found to have a substantial and persistent effect on bank stability that is most pronounced for smaller banks. (JEL: G21, 50, D82) Keywords: bank stability; geographic diversification; branching; banking competition; U.S. banking crisis 2008-2011The question of how geographic diversification affects bank stability has long been of concern to the literature on bank stability. While recent work largely focuses on the propagation of shocks originating from large banks via counterparty exposures, the great majority of U.S. bank failures during the 2008-2011 U.S. banking crisis occurred among small and mid-sized banks and were du

Logistikcontrolling für Verlader und Dienstleister | Zwei Seiten der Logistik-Medaille: Marktorientiertes Controlling der Logistik und der Supply Chain

Angesichts der Globalisierung nehmen die weltweiten Verkehrströme ständig zu. Davon ist Deutschland als geographisch zentraler Staat in Europa besonders betroffen. Hier nimmt nicht nur die Beschäftigung mit dem Thema Logistik zu, sondern sie wird auch immer spezieller. Dazu gehört auch die Gestaltung des Logistikcontrolling und der Einsatz seiner Instrumente