Efficient upgrading in network goods : is commitment always good?

The frequency of upgrades in technology markets is not socially optimal when the quality improvement is negligible and smaller than the adoption cost of the new product. In monopolies, the literature has identifed a suff cient factor for efficient upgrading: the firms power to commit to whether it will upgrade or not in the future. This is not true when an entry threat applies. In fact, it could even be that commitment is a factor of inefficiency when the market is open to competition. As shown in this paper, the incumbentís commitment adds an additional source of inefficiency while an entry threat could dissolve social optimality

Cross-cultural representations of musical shape

In cross-cultural research involving performers from distinct cultural backgrounds (U.K., Japan, Papua New Guinea), we examined 75 musicians' associations between musical sound and shape, and saw pronounced differences between groups. Participants heard short stimuli varying in pitch contour and were asked to represent these visually on paper, with the instruction that if another community member saw the marks they should be able to connect them with the sounds. Participants from the U.K. group produced consistent symbolic representations, which involved depicting the passage of time from left-to-right. Japanese participants unfamiliar with English language and western standard notation provided responses comparable to the U.K. group's. The majority opted to use a horizontal timeline, whilst a minority of traditional Japanese musicians produced unique responses with time represented vertically. The last group, a non-literate Papua New Guinean tribe known as BenaBena, produced a majority of iconic responses which did not follow the time versus pitch contour model, but highlighted musical qualities other than the parameters intentionally varied in the investigation, focusing on hue and loudness. The participants' responses point to profoundly different 'norms' of musical shape association, which may be linked to literacy and to the functional role of music in a community

Niemeier Lattices in the Free Fermionic Heterotic-String Formulation

The spinor-vector duality was discovered in free fermionic constructions of the heterotic-string in four dimensions. It played a key role in the construction of heterotic-string models with an anomaly free extra $Z^\prime$ symmetry that may remain unbroken down to low energy scales. A generic signature of the low scale string derived $Z^\prime$ model is via di-photon excess that may be within reach of the LHC. A fascinating possibility is that the spinor-vector duality symmetry is rooted in the structure of the heterotic-string compactifications to two dimensions. The two dimensional heterotic-string theories are in turn related to the so-called moonshine symmetries that underlie the two dimensional compactifications. In this paper we embark on exploration of this connection by the free fermionic formulation to classify the symmetries of the two dimensional heterotic-string theories. We use two complementary approaches in our classification. The first utilises a construction which is akin to the one used in the spinor-vector duality. Underlying this method is the triality property of $SO(8)$ representations. In the second approach we use the free fermionic tools to classify the twenty four dimensional Niemeier lattices.Comment: 22 pages. Standard LaTex. 1 figure. Title changed in journal. Minor corrections. Published versio

Model selection, estimation and forecasting in VAR models with short-run and long-run restrictions

We study the joint determination of the lag length, the dimension of the cointegrating space andthe rank of the matrix of short-run parameters of a vector autoregressive (VAR) model using modelselection criteria. We consider model selection criteria which have data-dependent penalties for alack of parsimony, as well as the traditional ones. We suggest a new procedure which is a hybridof traditional criteria and criteria with data-dependant penalties. In order to compute the fit ofeach model, we propose an iterative procedure to compute the maximum likelihood estimates ofparameters of a VAR model with short-run and long-run restrictions. Our Monte Carlo simulationsmeasure the improvements in forecasting accuracy that can arise from the joint determination oflag-length and rank, relative to the commonly used procedure of selecting the lag-length only andthen testing for cointegration.

Modelling Australian Domestic and International Inbound Travel: a Spatial-Temporal Approach

In this paper Australian domestic and international inbound travel are modelled by an anisotropic dynamic spatial lag panel Origin-Destination (OD) travel flow model. Spatial OD travel flow models have traditionally been applied in a single cross-sectional context, where the spatial structure is assumed to have reached its long run equilibrium and temporal dynamics are not explicitly considered. On the other hand, spatial effects are rarely accounted for in traditional tourism demand modelling. We attempt to address this dichotomy between spatial modelling and time series modelling in tourism research by using a spatial-temporal model. In particular, tourism behaviour is modelled as travel flows between regions. Temporal dependencies are accounted for via the inclusion of autoregressive components, while spatial autocorrelations are explicitly accounted for at both the origin and the destination. We allow the strength of spatial autocorrelation to exhibit seasonal variations, and we allow for the possibility of asymmetry between capital-city neighbours and non-capital-city neighbours. Significant spatial dynamics have been uncovered, which lead to some interesting policy implications.Tourism demand, Dynamic panel models, Travel flow model.

Statistical Inference on Changes in Income Inequality in Australia

This paper studies the changes in income inequality of individuals in Australia between 1986 and 1999. Individuals are divided into various subgroups along several dimensions, such as region of residence, age, employment status etc. The changes in inequality over time, between and within the various subgroups is studied, and the bootstrap method is used to establish whether these changes are statistically significant.Income inequality; Gini coefficient; Theil inequality measure; bootstrap.

VARMA versus VAR for Macroeconomic Forecasting

In this paper, we argue that there is no compelling reason for restricting the class of multivariate models considered for macroeconomic forecasting to VARs given the recent advances in VARMA modelling methodology and improvements in computing power. To support this claim, we use real macroeconomic data and show that VARMA models forecast macroeconomic variables more accurately than VAR models.Forecasting, Identification, Multivariate time series, Scalar components, VARMA models.

A Complete VARMA Modelling Methodology Based on Scalar Components

This paper proposes an extension to scalar component methodology for the identification and estimation of VARMA models. The complete methodology determines the exact positions of all free parameters in any VARMA model with a predetermined embedded scalar component structure. This leads to an exactly identified system of equations that is estimated using full information maximum likelihood.Identification, Multivariate time series, Scalar components, VARMA models.