Welfare guarantees for proportional allocations

According to the proportional allocation mechanism from the network optimization literature, users compete for a divisible resource -- such as bandwidth -- by submitting bids. The mechanism allocates to each user a fraction of the resource that is proportional to her bid and collects an amount equal to her bid as payment. Since users act as utility-maximizers, this naturally defines a proportional allocation game. Recently, Syrgkanis and Tardos (STOC 2013) quantified the inefficiency of equilibria in this game with respect to the social welfare and presented a lower bound of 26.8% on the price of anarchy over coarse-correlated and Bayes-Nash equilibria in the full and incomplete information settings, respectively. In this paper, we improve this bound to 50% over both equilibrium concepts. Our analysis is simpler and, furthermore, we argue that it cannot be improved by arguments that do not take the equilibrium structure into account. We also extend it to settings with budget constraints where we show the first constant bound (between 36% and 50%) on the price of anarchy of the corresponding game with respect to an effective welfare benchmark that takes budgets into account.Comment: 15 page

Screening in New Credit Markets: Can Individual Lenders Infer Borrower Creditworthiness in Peer-to-Peer Lending?

The current banking crisis highlights the challenges faced in the traditional lending model, particularly in terms of screening smaller borrowers. The recent growth in online peer-to-peer lending marketplaces offers opportunities to examine different lending models that rely on screening by multiple peers. This paper evaluates the screening ability of lenders in such peer-to-peer markets. Our methodology takes advantage of the fact that lenders do not observe a borrower’s true credit score but only see an aggregate credit category. We find that lenders are able to use available information to infer a third of the variation in creditworthiness that is captured by a borrower’s credit score. This inference is economically significant and allows lenders to lend at a 140-basis-points lower rate for borrowers with (unobserved to lenders) better credit scores within a credit category. While lenders infer the most from standard banking “hard” information, they also use non-standard (subjective) information. Our methodology shows, without needing to code subjective information that lenders learn even from such “softer” information, particularly when it is likely to provide credible signals regarding borrower creditworthiness. Our findings highlight the screening ability of peer-to-peer markets and suggest that these emerging markets may provide a viable complement to traditional lending markets, especially for smaller borrowers

Improved Bounds on the Phase Transition for the Hard-Core Model in 2-Dimensions

For the hard-core lattice gas model defined on independent sets weighted by an activity $\lambda$, we study the critical activity $\lambda_c(\mathbb{Z}^2)$ for the uniqueness/non-uniqueness threshold on the 2-dimensional integer lattice $\mathbb{Z}^2$. The conjectured value of the critical activity is approximately $3.796$. Until recently, the best lower bound followed from algorithmic results of Weitz (2006). Weitz presented an FPTAS for approximating the partition function for graphs of constant maximum degree $\Delta$ when $\lambda<\lambda_c(\mathbb{T}_\Delta)$ where $\mathbb{T}_\Delta$ is the infinite, regular tree of degree $\Delta$. His result established a certain decay of correlations property called strong spatial mixing (SSM) on $\mathbb{Z}^2$ by proving that SSM holds on its self-avoiding walk tree $T_{\mathrm{saw}}^\sigma(\mathbb{Z}^2)$ where $\sigma=(\sigma_v)_{v\in \mathbb{Z}^2}$ and $\sigma_v$ is an ordering on the neighbors of vertex $v$. As a consequence he obtained that $\lambda_c(\mathbb{Z}^2)\geq\lambda_c( \mathbb{T}_4) = 1.675$. Restrepo et al. (2011) improved Weitz's approach for the particular case of $\mathbb{Z}^2$ and obtained that $\lambda_c(\mathbb{Z}^2)>2.388$. In this paper, we establish an upper bound for this approach, by showing that, for all $\sigma$, SSM does not hold on $T_{\mathrm{saw}}^\sigma(\mathbb{Z}^2)$ when $\lambda>3.4$. We also present a refinement of the approach of Restrepo et al. which improves the lower bound to $\lambda_c(\mathbb{Z}^2)>2.48$.Comment: 19 pages, 1 figure. Polished proofs and examples compared to earlier versio

2-Player Nash and Nonsymmetric Bargaining Games: Algorithms and Structural Properties

The solution to a Nash or a nonsymmetric bargaining game is obtained by maximizing a concave function over a convex set, i.e., it is the solution to a convex program. We show that each 2-player game whose convex program has linear constraints, admits a rational solution and such a solution can be found in polynomial time using only an LP solver. If in addition, the game is succinct, i.e., the coefficients in its convex program are ``small'', then its solution can be found in strongly polynomial time. We also give a non-succinct linear game whose solution can be found in strongly polynomial time

Screening Peers Softly: Inferring the Quality of Small Borrowers

The recent banking crisis highlights the challenges faced in credit intermediation. New online peer-to-peer lending markets offer opportunities to examine lending models that primarily cater to small borrowers and that generate more types of information on which to screen. This paper evaluates screening in a peer-to-peer market where lenders observe both standard financial information and soft, or nonstandard, information about borrower quality. Our methodology takes advantage of the fact that while lenders do not observe a borrower’s exact credit score, we do. We find that lenders are able to predict default with 45% greater accuracy than what is achievable based on just the borrower’s credit score, the traditional measure of creditworthiness used by banks. We further find that lenders effectively use nonstandard or soft information and that such information is relatively more important when screening borrowers of lower credit quality. In addition to estimating the overall inference of creditworthiness, we also find that lenders infer a third of the variation in the dimension of creditworthiness that is captured by the credit score. This credit-score inference relies primarily upon standard hard information, but still draws relatively more from softer or less standard information when screening lower-quality borrowers. Our results highlight the importance of screening mechanisms that rely on soft information, especially in settings targeted at smaller borrowers.

Outsiders: an exploratory history of IS in corporations

This paper is an exploratory study that provides a brief history of information systems (IS) in corporations that are not part of the Information Technology sector, such as retailers, banks, government agencies and so on. It looks at the development of the IS function and the changing roles of IS practitioners in such organisations over the past 60 years, and assesses how they perceived themselves and were perceived by their peers, by business colleagues and by others. It uses the testimony of successful IS practitioners to provide a grounded perspective on the history of the IS worker over this time. The research identifies a trajectory of a gradual diminishment in the role and status of the IS worker in the corporation over the lifetime of the discipline. It observes that the IS worker has experienced changed fortunes: from a position of influence at the outset, leading to a peak of status and reward in the years up to the millennium; and to the present day where the occupation has a much lower profile. It ascribes this to the increasing commoditisation of IS, manifested by phenomena such as end-user computing, outsourcing and cloud computing. The paper is of relevance to academics who are interested in IS in the corporate organisation; to business professionals, who are sometimes bewildered by their IS colleagues; and to those who work in IS. The research is presented as an interpretative study and is intended to help future researchers frame questions and design research projects. It also aims to inform and witness, and provide a perspective on a currently neglected part of the business world

Fermionic Molecular Dynamics for nuclear dynamics and thermodynamics

A new Fermionic Molecular Dynamics (FMD) model based on a Skyrme functional is proposed in this paper. After introducing the basic formalism, some first applications to nuclear structure and nuclear thermodynamics are presentedComment: 5 pages, Proceedings of the French-Japanese Symposium, September 2008. To be published in Int. J. of Mod. Phys.

The effective bandwidth problem revisited

The paper studies a single-server queueing system with autonomous service and $\ell$ priority classes. Arrival and departure processes are governed by marked point processes. There are $\ell$ buffers corresponding to priority classes, and upon arrival a unit of the $k$th priority class occupies a place in the $k$th buffer. Let $N^{(k)}$, $k=1,2,...,\ell$ denote the quota for the total $k$th buffer content. The values $N^{(k)}$ are assumed to be large, and queueing systems both with finite and infinite buffers are studied. In the case of a system with finite buffers, the values $N^{(k)}$ characterize buffer capacities. The paper discusses a circle of problems related to optimization of performance measures associated with overflowing the quota of buffer contents in particular buffers models. Our approach to this problem is new, and the presentation of our results is simple and clear for real applications.Comment: 29 pages, 11pt, Final version, that will be published as is in Stochastic Model

Stability Properties of Networks with Interacting TCP Flows

The equilibrium distributions of a Markovian model describing the interaction of several classes of permanent connections in a network are analyzed. It has been introduced by Graham and Robert. For this model each of the connections has a self-adaptive behavior in that its transmission rate along its route depends on the level of congestion of the nodes on its route. It has been shown that the invariant distributions are determined by the solutions of a fixed point equation in a finite dimensional space. In this paper, several examples of these fixed point equations are studied. The topologies investigated are rings, trees and a linear network, with various sets of routes through the nodes