Rank as an Incentive

Money is the prime incentive in economic models. Recent evidence makes it clear that people are also greatly concerned about how their incomes compare with those of others, suggesting that rank may be a strong motivator as well. Three experiments in Vietnam assessed whether students in real-world learning environments were concerned with their performance rankings. The results showed that concern with rank, even when rankings were not publicly revealed, strongly motivated performance on academic tests. Moreover, rank was able to outweigh money as a motivator.

The Behavior of Savings and Asset Prices When Preferences and Beliefs Are Heterogeneous

Movements in asset prices are a major risk confronting individuals. This paper establishes new asset pricing results when agents differ in risk preference, time preference and/or expectations. It shows that risk tolerance is a critical concept driving savings decisions, consumption allocations, prices and return volatilities. Surprisingly, due to the equilibrium risk sharing, the precautionary savings motive in the aggregate can vastly exceed that of even the most prudent actual agent in the economy. Consequently, a low real interest rate, resulting from large aggregate savings, can prevail with reasonable risk aversions for all agents. One downside of a large aggregate savings motive is that savings rates become extremely sensitive to output fluctuation. Thus, the same mechanism that produces realistically low interest rates tends to make them unrealistically volatile. A powerful isomorphism allows differences in time preference and expectations to be swept away in the analysis, yielding an equivalent economy whose agents differ merely in risk aversion. These results hold great potential to simplify the analysis of heterogeneous-agent economies, as we demonstrate in quantifying how asset prices move and bounding their volatilities. All results are obtained in closed form for any number of agents possessing additively separable preferences in an endowment economy.

A Differential Power Analysis Resistant Randomized Algorithm using Multiple AES Ciphers

Differential power analysis (DPA) side channel attacks have been shown to have great effectiveness in breaking ciphers (such as the Advanced Encryption Standard or AES) that were previously though to be unbreakable. There are currently many methods published that prevent differential power analysis on AES. The method proposed for this project is based on the increased usage of multiprocessors and multicore processors. By using multiple copies of the same AES cipher, a randomly chosen cipher is used to encrypt each plaintext. The other ciphers are then used to obfuscate the data made available to the attacker for DPA in the hope of making DPA impossible or require a statistically large amount of data that it is practically impossible to run successfully

Effective degrees of nonlinearity in a family of generalized models of two-dimensional turbulence

We study the small-scale behavior of generalized two-dimensional turbulence governed by a family of model equations, in which the active scalar $\theta=(-\Delta)^{\alpha/2}\psi$ is advected by the incompressible flow $\u=(-\psi_y,\psi_x)$. The dynamics of this family are characterized by the material conservation of $\theta$, whose variance is preferentially transferred to high wave numbers. As this transfer proceeds to ever-smaller scales, the gradient $\nabla\theta$ grows without bound. This growth is due to the stretching term $(\nabla\theta\cdot\nabla)\u$ whose ``effective degree of nonlinearity'' differs from one member of the family to another. This degree depends on the relation between the advecting flow $\u$ and the active scalar $\theta$ and is wide ranging, from approximately linear to highly superlinear. Linear dynamics are realized when $\nabla\u$ is a quantity of no smaller scales than $\theta$, so that it is insensitive to the direct transfer of the variance of $\theta$, which is nearly passively advected. This case corresponds to $\alpha\ge2$, for which the growth of $\nabla\theta$ is approximately exponential in time and non-accelerated. For $\alpha<2$, superlinear dynamics are realized as the direct transfer of entails a growth in \nabla\u, thereby enhancing the production of $\nabla\theta$. This superlinearity reaches the familiar quadratic nonlinearity of three-dimensional turbulence at $\alpha=1$ and surpasses that for $\alpha<1$. The usual vorticity equation ($\alpha=2$) is the border line, where \nabla\u and $\theta$ are of the same scale, separating the linear and nonlinear regimes of the small-scale dynamics. We discuss these regimes in detail, with an emphasis on the locality of the direct transfer.Comment: 6 journal pages, to appear in Physical Review

Revisiting Batchelor's theory of two-dimensional turbulence

Recent mathematical results have shown that a central assumption in the theory of two-dimensional turbulence proposed by Batchelor (Phys. Fluids, vol. 12, 1969, p. 233) is false. That theory, which predicts a X-2/3 k(-1) enstrophy spectrum in the inertial range of freely-decaying turbulence, and which has evidently been successful in describing certain aspects of numerical simulations at high Reynolds numbers Re, assumes that there is a finite, non-zero enstrophy dissipation X in the limit of infinite Re. This, however, is not true for flows having finite vorticity. The enstrophy dissipation in fact vanishes. We revisit Batchelor's theory and propose a simple modification of it to ensure vanishing X in the limit Re -> infinity. Our proposal is supported by high Reynolds number simulations which confirm that X decays like 1/ln Re, and which, following the time of peak enstrophy dissipation, exhibit enstrophy spectra containing an increasing proportion of the total enstrophy (omega(2))/2 in the inertial range as Re increases. Together with the mathematical analysis of vanishing X, these observations motivate a straightforward and, indeed, alarmingly simple modification of Batchelor's theory: just replace Batchelor's enstrophy spectrum X(2/3)k(-1) with (omega(2))k(-1)(In Re)(-1).Publisher PDFPeer reviewe

AN EMPIRICAL ANALYSIS OF PUBLIC AND PRIVATE SPILLOVERS WITHIN THE CANOLA BIOTECH INDUSTRY

The study uses firm-specific data in the biotech canola industry to empirically examine research spillovers among public and private firms at the level of research output, research sales revenue, and research social revenue. The non-pecuniary spillovers that are examined include basic research, human capital/ knowledge (as measured through other-firm expenditures) and genetics (as measured through yields of other-firms). The results provide strong empirical evidence of several research spillovers in the biotech crop research industry such as: basic and applied public research creates a positive spillover for private firms at all levels; applied expenditure within-group reduces other-firm revenue while between-group expenditure increases revenue; genetic spillovers within-group have a positive impact on yield but tend to have a negative impact on firm revenue.Agribusiness,

Pecuniary, Non-Pecuniary, and Downstream Research Spillovers: The Case of Canola

This paper develops an empirical framework for estimating a number of inter-firm and downstream research spillovers in the canola crop research industry. The spillovers include basic research, human capital/ knowledge (as measured through other-firm expenditures), and genetics (as measured through yields of other-firms). The model used to examine spillover effects on research productivity provides evidence that there are many positive inter-firm non-pecuniary research spillovers, which is consistent with a research clustering effect. The second model, which examines spillovers at the level of firm revenue , shows that, while private firms tend to crowd one another, public firm expenditure on basic and applied research creates a crowding-in effect for private firms. This model also shows that enhanced intellectual property rights have increased the revenues of private firms. The third model, which examines social value of each firm's output, provides evidence that downstream research spillovers remain important in this modern crop research industry.basic research, applied research, public research expenditures, private research expenditures, biotechnology, Research and Development/Tech Change/Emerging Technologies, O3,