The Sign-up Game, Sophisticated Learning and Learning Variable Demand

This dissertation makes contributions in topics related to mechanism design and learn-ing in game theoretic environments through three essays. The rst essay deals withthe question of mechanism design in the principal-agent model. The main contribu-tion of this essay is in extending the work by Piketty (1993). It prescribes a mechanismin incomplete informational settings where the principal is able to implement rst-best contracts while extracting the entire surplus. Importantly, the mechanism issuch that the desired outcome can be uniquely obtained when agents play the actionthat survives iterative elimination of dominated strategies. Furthermore, given themechanism, the desired outcome is shown to be a truth-revealing Nash equilibriumwhich is also Pareto-ecient. It is shown that the proposed mechanism also has thefeature that none of the agents prefer any of the other possible Nash Equilibria tothe status quo. It thus gives insights into possible mechanisms in nite agent settingsthat could improve upon the traditional second-best results.In the second essay, a model of sophisticated learning is developed where itassumes that a fraction of the population is sophisticated while the rest are adaptive learners. Sophisticated learners in the model try to maximize their cumulative payoin the entire length of the repeated game and are aware of the way adaptive learnerslearn. Sophisticated learning contrasts other models of learning which typically tendto maximize the payo for the next period by extrapolating the history of play.The sophisticated learning model is estimated on data of experiments on repeatedcoordination games where it provides evidence of such learning behavior.The third essay deals with the optimal pricing policy for a rm in an oligopolythat is uncertain about the demand it faces. The demand facing the oligopoly, whichcan be learned through their pricing policy, changes over time in a Markovian fashion.It also deduces the conditions in which learning (experimentation) is not achievableand outlines the dierent learning policies that are possible in other settings. Themodel combines the monopoly learning literature with that of the literature on pric-ing behavior of rms over business cycles. The model has interesting insights onthe pricing behavior over business cycles. It predicts that prices jump as the beliefof a possible future boom rises over a certain threshold. The model also predictscompetition to be quite vigorous following a boom while rms are predicted not toexperiment with their (pricing) policies for many periods following a bust

Designing customizable end user applications using semantic technologies to improve information management

Thesis (M. Eng.)--Massachusetts Institute of Technology, Dept. of Electrical Engineering and Computer Science, June 2006."May 2006."Includes bibliographical references (leaves 152-155).Personalization capabilities in computer applications attempt to better meet the needs of individuals. The more traditional and widespread paradigm in application design is that the user should adapt to the available application. This requires that the individual user's task be sliced and molded to fit the dimensions offered by an inflexible, monolithic application. It is desirable to have an application that can be shaped to fit each individual user's dynamic needs. However, it is important that this is done in an intuitive and unobtrusive way. In this thesis, we design and evaluate a personalizable application developed to aid life science researchers in their work. We designed the application in Haystack, a platform for developing semantic applications and user interfaces. The application gave the user flexibility in personalizing the way in which information is organized and displayed, while giving users access to the tools necessary to perform their tasks. We selected researchers as the user group to focus on because of the inherent necessity in their work for originality and dynamic adaptation. Life sciences research was chosen as the domain due to its potential to benefit from the application of semantic technologies. We tested how users reacted and adapted to this application by conducting a formal user study.by Sumudu Weerakoon Watugala.M.Eng

Designing Customizable End User Applications using . . .

Personalization capabilities in computer applications attempt to better meet the needs of individuals. The more traditional and widespread paradigm in application design is that the user should adapt to the available application. This requires that the individual user's task be sliced and molded to fit the dimensions offered by an inflexible, monolithic application. It is desirable to have an application that can be shaped to fit each individual user's dynamic needs. However, it is important that this is done in an intuitive and unobtrusive way. In this thesis, we design and evaluate a personalizable application developed to aid life science researchers in their work. We designed the application in Haystack, a platform for developing semantic applications and user interfaces. The application gave the user flexibility in personalizing the way in which information is organized and displayed, while giving users access to the tools necessary to perform their tasks

Direct resistance heating in sheet metal forming

published_or_final_versionMechanical EngineeringMasterMaster of Philosoph

Generation of Sinhala characters in autocad drawings

More and more industries in Sri Lanka are now turning to computers to make engineering drawings. The most popular software package for computer aided drawing (CAD) is AutoCAD developed by AutoDESK Inc. of USA. computer-Aided Design and Computer Aided Manufacturing (CAD/CAM) centre of the Department of Mechanical Engineering obtained the AutoCAD package as early as 1991. CAD/CAM Centre has so far trained over 300 personnel in industry on the use of AutoCAD by running weekend short courses

Low-cost one-axis solar tracking operated by water pressure

Solar photovoltaic CPV)panels are increasingly used in rural areas of Sri Lanka where the main grid electricity is not available. The high initial cost is a major deterrent in the popularization of this renewable energy source. Because of the complexities and additional cost involved, solar tracking is not done for these panels, and the panels are mounted at a fixed orientation, normally at an inclination of about 6-10°, facing the South. The additional solar power obtainable by having one-axis solar tracking can not justify the additional cost needed for tracking mechanisms available now

Optical character recognition for sinhala text using feature analysis

Optical Character Recognition (OCR) is now a reality for documents printed in English. In the present study, the groundwork for the recognition of Sinhala characters is done. Matrix Matching and Feature Analysis are the two commonly used methods for the recognition of English letters. In this study the Feature Analysis method is investigated to recognize Sinhala characters. Matrix matching method is found to be suitable for recognizing documents containing text with known font and typeface. It should also be used to identify and extract the modifiers used on top, down or after the character. This helps in the identification of the base character using feature analysis. Several features of Sinhala characters can be extracted by running simple programs on the pixel array of the character. These features include aspect ratio, inscribing octagon, and number of pixel curves crossed when the character is sliced at different angles. By running these programs on Sinhala characters one can prepare a set of values of these features for standard characters. Afterwards the features of an unknown character can be compared with the standard data for recognition. Programming for Sinhala Character Recognition is done using MathCAD, an application package for complex mathematical calculations. Since the algorithms are written in pseudocode it is easy to convert these algorithms to a C++ program

Essays on interconnected markets

This thesis consists of three essays that explore the dynamics of interconnected markets and examine the relationships between markets, investor behavior, and fundamental characteristics of the firm and the economy. In the first essay, we investigate the role of trade credit links in generating cross-border return predictability between international firms. Using data from 43 countries from 1993 to 2009, we find that firms with high trade credit in producer countries have stock returns that are strongly predictable based on the returns of their associated customer countries. This behavior is especially prevalent among firms with high levels of foreign sales. To better understand this effect we develop an asset pricing model in which firms in different countries are connected by trade credit links. The model offers further predictions about this phenomenon, including stronger predictability during periods of high credit constraints and low uninformed trading volume. We find supportive empirical evidence for these predictions. The second essay investigates the dynamics of commodity futures volatility. I derive the variance decomposition for the futures basis to show how unexpected excess returns result from new information about expected future interest rates, convenience yields, and risk premia. Using data on major commodity futures markets and global bilateral commodity trade, I analyze the extent to which commodity volatility is related to fundamental uncertainty arising from increased emerging market demand and macroeconomic uncertainty, and control for the potential impact of financial frictions introduced by changing market structure and index trading. I find that a higher concentration in the emerging market importers of a commodity is associated with higher futures volatility. Commodity futures volatility is significantly predictable using variables capturing macroeconomic uncertainty. The third essay investigates the differential explanatory power of consumer (importing countries) and producer (exporting countries) risk in explaining the volatility of commodity spot premia and term premia using trade-weighted indices of GDP volatility. Using data for major commodity futures markets, bilateral commodity trade, exchange rates, and GDP for countries trading these commodities, I test hypotheses on the heterogeneous impact of consumer and producer shocks, potentially driven by differences in hedging preferences and investment planning horizons. Producer risk is significant for both short-dated and long-dated maturities, while consumer risk has greater explanatory power for the volatility of the term spread.</p

Essays on interconnected markets

This thesis consists of three essays that explore the dynamics of interconnected markets and examine the relationships between markets, investor behavior, and fundamental characteristics of the firm and the economy. In the first essay, we investigate the role of trade credit links in generating cross-border return predictability between international firms. Using data from 43 countries from 1993 to 2009, we find that firms with high trade credit in producer countries have stock returns that are strongly predictable based on the returns of their associated customer countries. This behavior is especially prevalent among firms with high levels of foreign sales. To better understand this effect we develop an asset pricing model in which firms in different countries are connected by trade credit links. The model offers further predictions about this phenomenon, including stronger predictability during periods of high credit constraints and low uninformed trading volume. We find supportive empirical evidence for these predictions. The second essay investigates the dynamics of commodity futures volatility. I derive the variance decomposition for the futures basis to show how unexpected excess returns result from new information about expected future interest rates, convenience yields, and risk premia. Using data on major commodity futures markets and global bilateral commodity trade, I analyze the extent to which commodity volatility is related to fundamental uncertainty arising from increased emerging market demand and macroeconomic uncertainty, and control for the potential impact of financial frictions introduced by changing market structure and index trading. I find that a higher concentration in the emerging market importers of a commodity is associated with higher futures volatility. Commodity futures volatility is significantly predictable using variables capturing macroeconomic uncertainty. The third essay investigates the differential explanatory power of consumer (importing countries) and producer (exporting countries) risk in explaining the volatility of commodity spot premia and term premia using trade-weighted indices of GDP volatility. Using data for major commodity futures markets, bilateral commodity trade, exchange rates, and GDP for countries trading these commodities, I test hypotheses on the heterogeneous impact of consumer and producer shocks, potentially driven by differences in hedging preferences and investment planning horizons. Producer risk is significant for both short-dated and long-dated maturities, while consumer risk has greater explanatory power for the volatility of the term spread.This thesis is not currently available in ORA