Risk Premium and Central Bank Intervention

This study examines the relation between the risk premium and central bank intervention. Forward rates are calculated for the Turkish Lira-USD exchange market and then the effect of central bank intervention on the risk premium is estimated. Using high quality daily intervention data from the Central Bank of Turkey as well as implied forward rates, an MA (21)-GARCH (1,1) model is estimated. Both purchases and sales of US dollars by the Central Bank of Turkey appear to have no effect on the size of risk premium for TL/USD for the free float period. Similar results are found for the managed float period. Empirical support was weak for the theoretical model, with intervention having a significant effect on the risk premium.Central Bank Intervention, Risk Premium

Tax Collection Costs, Tax Evasion and Optimal Interest Rates

In this paper, I investigate to what extent the cross-country variation in nominal interest rates can be explained as being due to governments' optimal response to economic conditions such as tax collection costs, tax evasion and government consumption needs. In particular, I study the effects of costly income taxes in the presence of an informal sector on the solution to a Ramsey problem in a general equilibrium framework. Unlike most of the previous analyses of optimal inflationary finance, the model postulates that conventional taxes carry collection costs whereas fiat money can be printed costlessly. For some countries, I measure tax collection costs, use the tax evasion estimates reported in the literature, and then calculate the optimal interest rate based on the model. Comparison of the actual and optimal interest rates demonstrates that the model can in fact partly explain the observed deviations from the Friedman Rule. I also show that allowing cross-country differences in the elasticity of substitution between formal and informal sectors can increase the model's explanatory power.

What networks do to firms and what firms do to networks: Evolution of alliance portfolios in networked markets

This study explores the question of how alliance portfolios change over time. In the setting of the U.S. wireless gaming market, I collected real-time and longitudinal data on entrepreneurial game publishers over two and a half years. This process revealed that alliance portfolios of firms can grow or deteriorate rapidly through virtuous or vicious cycles, depending on their starting position in a networked market. Those firms in a virtuous cycle have the additional advantage that they can use resource-dependence strategies to fuel the virtuous cycle. Finally, I find that changes in a firm's alliance portfolio occur simultaneously with other firm-level changes, such as physical growth, new rounds of financing, public offering and game coverage. The findings have potential contributions to literature at the firm, portfolio, and network levels. Overall, the picture provided is one that advocates multi-level and longitudinal analysis for the understanding of firm, portfolio, and network-level outcomes deriving from firm-level interactions and portfolio strategies.Alliance portfolios; firm evolution; strategy; resource dependence;

FAME: Face Association through Model Evolution

We attack the problem of learning face models for public faces from weakly-labelled images collected from web through querying a name. The data is very noisy even after face detection, with several irrelevant faces corresponding to other people. We propose a novel method, Face Association through Model Evolution (FAME), that is able to prune the data in an iterative way, for the face models associated to a name to evolve. The idea is based on capturing discriminativeness and representativeness of each instance and eliminating the outliers. The final models are used to classify faces on novel datasets with possibly different characteristics. On benchmark datasets, our results are comparable to or better than state-of-the-art studies for the task of face identification.Comment: Draft version of the stud

Statistics of a hydrophobic chain near a hydrophobic boundary

We study the behaviour of a hydrophobic chain near a hydrophobic boundary in two dimensions, using the decorated lattice model of Berkema and Widom [G.T. Barkema and B. Widom, J. Chem. Phys. 113, 2349 (2000)] to obtain effective, temperature dependent intrachain and chain-boundary interactions. We use these interactions to construct two model hamiltonians which can be solved exactly. Our results compare favorably with preliminary Monte Carlo computations, using the same effective interactions. At relatively low temperatures and at high temperatures, we find that the chain is randomly configured in the ambient water, and detached from the wall, whereas at intermediate temperatures it adsorbs onto the wall in a stretched or partially folded state, again depending upon the temperature, and the energy of solvation.Comment: 6 pages text, 11 figure