On the convergence of autonomous agent communities

This is the post-print version of the final published paper that is available from the link below. Copyright @ 2010 IOS Press and the authors.Community is a common phenomenon in natural ecosystems, human societies as well as artificial multi-agent systems such as those in web and Internet based applications. In many self-organizing systems, communities are formed evolutionarily in a decentralized way through agents' autonomous behavior. This paper systematically investigates the properties of a variety of the self-organizing agent community systems by a formal qualitative approach and a quantitative experimental approach. The qualitative formal study by applying formal specification in SLABS and Scenario Calculus has proven that mature and optimal communities always form and become stable when agents behave based on the collective knowledge of the communities, whereas community formation does not always reach maturity and optimality if agents behave solely based on individual knowledge, and the communities are not always stable even if such a formation is achieved. The quantitative experimental study by simulation has shown that the convergence time of agent communities depends on several parameters of the system in certain complicated patterns, including the number of agents, the number of community organizers, the number of knowledge categories, and the size of the knowledge in each category

Regulating debit cards: the case of ad valorem fees

Debit cards have become an indispensable part of the U.S. payments system, accounting for more than a third of consumer payments at point of sale. With this development has come controversy: Card networks charge merchants fees that merchants believe are too high. And most of the fees are ad valorem that is, based on transaction value rather than fixed fees per transaction. ; Given that debit cards incur a fixed cost per transaction, why do networks charge ad valorem fees? How do ad valorem fees affect payment market participants, including consumers, merchants, and card networks? And should policymakers consider regulating debit cards by requiring fixed per-transaction fees? ; Wang explores this controversy about debit card fee structures. His analysis shows that, when card networks and merchants both have market power, card networks earn a higher profit by charging ad valorem fees than fixed per-transaction fees. At the same time, merchant profits are reduced yet both consumer surplus and social welfare are increased. As an alternative, policymakers might consider regulating the debit fee structure simply by requiring fixed per-transaction fees (but allowing card networks to freely set the fee levels). Wang suggests, however, that this alternative may increase merchant profits at the expense of card networks, consumers, and social welfare. Therefore, caution should be taken when policymakers consider intervening in the debit card market.

Formula of Entropy along Unstable Foliations for C1C^1 Diffeomorphisms with Dominated Splitting

Metric entropies along a hierarchy of unstable foliations are investigated for $C^1$ diffeomorphisms with dominated splitting. The analogues of Ruelle's inequality and Pesin's formula, which relate the metric entropy and Lyapunov exponents in each hierarchy, are given

Technological innovation and market turbulence: the dot-com experience

This paper explains market turbulence, such as the recent dotcom boom/bust cycle, as equilibrium industry dynamics triggered by technology innovation. When a major technology innovation arrives, a wave of new firms enter the market implementing the innovation for profits. However, if the innovation complements existing technology, some new entrants will later be forced out as more and more incumbent firms succeed in adopting the innovation. It is shown that the diffusion of Internet technology among traditional brick-and-mortar firms is indeed the driving force behind the rise and fall of dotcoms as well as the sustained growth of e-commerce. Empirical evidence from retail and banking industries supports the theoretical findings. ; Earlier title: Technology innovation and market turbulence: a dot-com exampleTechnology

Learning, diffusion and the industry life cycle

An industry typically experiences initial mass entry and later shakeout of producers over its life cycle. It can be explained as a competitive equilibrium outcome driven by the dynamic interaction between technology progress and demand diffusion. When a new product is introduced, high-income consumers tend to adopt it first. Technology then improves with cumulative output and demand growth generates S-shaped diffusion as the product penetrates lower-income groups. Eventually fewer new adopters are available and the number of firms starts to decline. It is shown that faster technological learning, higher mean income or larger market size contributes to faster demand diffusion and earlier industry shakeout. Empirical studies on the US and UK television industries as well as ten other US industries confirm the theoretical findings. ; Alternate title: Income distribution, market size and the evolution of industryTechnology

Market structure and credit card pricing: what drives the interchange?

This paper presents a model for the credit card industry, where oligopolistic card networks price their products in a complex marketplace with competing payment instruments, rational consumers/merchants, and competitive card issuers/acquirers. The analysis suggests that card networks demand higher interchange fees to maximize card issuers' profits as card payments become more efficient. At equilibrium, consumer rewards and card transaction volume also increase, while consumer surplus and merchant profits may not. The model provides a unified framework to evaluate credit card industry performance and government interventions.Credit cards ; Markets