A study on the demand and response correspondences in the presence of indivisibilities

This paper attempts to study market and noncooperative game models in the presence of indivisibilities from a unified point of view. For market models we examine the sum of consumers’ demand correspondences mapping an integral price space to an integral commodity space, whereas for noncooperative game models we investigate the product of players’ response correspondences mapping a discrete strategy profile space to itself. We show that, in several typical models, the sum and the product correspondences share an important property that they are ‘locally gross direction preserving’, on the standard triangulation of the convex hull of the domain. Moreover, we prove the existence of a Walrasian equilibrium and a Nash equilibrium in respective models through a discrete multivariate mean value theorem.     

On balking from an empty queue

The intuition while observing the economy of queueing systems, is that one’s motivation to join the system, decreases with its level of congestion. Here we present a queueing model where sometimes the opposite is the case. The point of departure is the standard first-come first-served single server queue with Poisson arrivals. Customers commence service immediately if upon their arrival the server is idle. Otherwise, they are informed if the queue is empty or not. Then, they have to decide whether to join or not. We assume that the customers are homogeneous and when they consider whether to join or not, they assess their queueing costs against their reward due to service completion. As the whereabouts of customers interact, we look for the (possibly mixed) join/do not join Nash equilibrium strategy, a strategy that if adopted by all, then under the resulting steady-state conditions, no one has any incentive not to follow it oneself. We show that when the queue is empty then depending on the service distribution, both ‘avoid the crowd’ (ATC) and ‘follow the crowd’ (FTC) scenarios (as well as none-of-the-above) are possible. When the queue is not empty, the situation is always that of ATC. Also, we show that under Nash equilibrium it is possible (depending on the service distribution) that the joining probability when the queue is empty is smaller than it is when the queue is not empty. This research was supported by The Israel Science Foundation Grant No. 237/02.     

A changing trajectory of proof learning in the geometry inquiry classroom

The purpose of this study is to explore how students changes through learning to construct mathematical proofs in an inquiry-based middle school geometry class in Korea. Although proof has long been considered as one of the most important aspects of mathematics education, it is well-known that it is one of the most difficult areas of school mathematics for students. The geometry inquiry classroom (GIC) is an experimental class designed to teach geometry, especially focusing on teaching proof, based on students’ own inquiry. Based on a 2-year participant observation in the GIC, this study was conducted to address the following research question: how has students’ practice of mathematical proof been changed through their participation in the GIC? The in-depth analysis of the classroom discourse identified three stages through which the students’ practice of mathematical proof was transformed in the GIC: ‘emergent understanding of proof’, ‘proof learning as a goal-oriented activity’, ‘experiencing proof as the practice of mathematics’. The study found that as learning evolved through these stages, so the mathematics teacher’s role shifted from being an instructor to a mediator of communication. Most importantly, this research showed that the GIC has created a learning environment where students develop their competence in constructing meaningful mathematical proof and grow to be ‘a human who proves’, ultimately ‘a person who playfully engages with mathematics’.     

Semidefinite complementarity reformulation for robust Nash equilibrium problems with Euclidean uncertainty sets

Consider the N-person non-cooperative game in which each player’s cost function and the opponents’ strategies are uncertain. For such an incomplete information game, the new solution concept called a robust Nash equilibrium has attracted much attention over the past several years. The robust Nash equilibrium results from each player’s decision-making based on the robust optimization policy. In this paper, we focus on the robust Nash equilibrium problem in which each player’s cost function is quadratic, and the uncertainty sets for the opponents’ strategies and the cost matrices are represented by means of Euclidean and Frobenius norms, respectively. Then, we show that the robust Nash equilibrium problem can be reformulated as a semidefinite complementarity problem (SDCP), by utilizing the semidefinite programming (SDP) reformulation technique in robust optimization. We also give some numerical example to illustrate the behavior of robust Nash equilibria.     

An ‘Emergent Model’ for Rate of Change

Does speed provide a ‘model for’ rate of change in other contexts? Does JavaMathWorlds (JMW), animated simulation software, assist in the development of the ‘model for’ rate of change? This project investigates the transference of understandings of rate gained in a motion context to a non-motion context. Students were 27 14–15 year old students at an Australian secondary school. The instructional sequence, utilising JMW, provided rich learning experiences of rate of change in the context of a moving elevator. This context connects to students’ prior knowledge. The data taken from pre- and post-tests and student interviews revealed a wide variation in students’ understanding of rate of change. The variation was mapped on a hypothetical learning trajectory and interpreted in the terms of the ‘emergent models’ theory (Gravemeijer, Math Think Learn 1(2):155–177, 1999) and illustrated by specific examples from the data. The results demonstrate that most students were able to use the ‘model of’ rate of change developed in a vertical motion context as a ‘model for’ rate of change in a horizontal motion context. A smaller majority of students were able to use their, often incomplete, ‘model of’ rate of change as a ‘model for’ reasoning about rate of change in a non-motion context.     

On Estimating a Dynamic Function of a Stochastic System with Averaging

We consider a two-scaled diffusion system, when drift and diffusion parameters of the ‘slow’ component are contaminated by the ‘fast’ unobserved component. The goal is to estimate the dynamic function which is defined by averaging the drift coefficient of the ‘slow’ component w.r.t. the stationary distribution of the ‘fast’ one. We apply a locally linear smoother with a data-driven bandwidth choice. The procedure is fully adaptive and nearly optimal up to a log log factor. This revised version was published online in June 2006 with corrections to the Cover Date.     

Interactions between government and firms: a differential game approach

In this paper we study an extended version of the model described in Gradus (J. Econ. 81:1092–1109, 1989) in order to determine the optimal taxation policy of a government and its effects on the stock of capital goods growth as a result of the activity developed by firms. It is shown that, by introducing a wealth tax, there exists an optimal wealth tax rate for which the open-loop/feedback Nash/Stackelberg equilibria coincide, maximizing the payments for both agents (government and firms), so that the open-loop Stackelberg equilibrium becomes both time consistent and subgame perfect. Partially supported by MEC (Spain) Grants MTM2006-13468, BMF2002-03493 and project ‘Ingenio Mathematica (i-MATH)’ No. CSD2006-00032 (Consolider-Ingenio 2010).     

Constructing greedy linear extensions by interchanging chains

A natural way to prove that a particular linear extension of an ordered set is ‘optimal’ with respect to the ‘jump number’ is to transform this linear extension ‘canonically’ into one that is ‘optimal’. We treat a ‘greedy chain interchange’ transformation which has applications to ordered sets for which each ‘greedy’ linear extension is ‘optimal’.     

Constrained equilibrium in a bidding problem

There are a number of situations where firms vie for some constrained total quantity by bidding individual quantities but where the allocation is determined on a ‘pro-rated’ basis. One such example is a licenses-on-demand method of import quota allocation. Bidders are constrained to bid at most the total quantity, and if the sum of all bids exceeds this total, the awards are granted proportional to the fractional amounts that the bidders request. In this note, we identify the (Nash) equilibrium of the model, present some examples, and do a sensitivity analysis of the bids as the total amount available changes. We also look into changes of the bids when a new participant enters the bidding process. In an economic context, such allocation methods are shown to be biased in favor of the least efficient firms.     

A Differential Game Related to Terrorism: Nash and Stackelberg Strategies

The question of how best to prosecute the ‘war on terror’ leads to strategic interaction in an intertemporal setting. We consider a nonzero sum differential game between a government and a terrorist organisation. Due to the state-separability of the game we are able to determine Nash and Stackelberg solutions in analytic form. Their comparison as well as the sensitivity analysis deliver interesting insight into the design of efficient measures to combat terror.     

Analysis and design of selection committees: a game theoretic secretary problem

Firms often delegate important decisions to committees which are set up specifically for that purpose; for example selection committees. We analyze the equilibrium behavior of a game in which committee members (the players) interview candidates sequentially, either hiring or going on to the next one. The players have differing evaluations of candidates (e.g. one cares about typing skills; the other about IT skills), which become their utilities if the candidate is hired. We then consider the optimal design (rules of the game) of such a committee, from the point of view of the firm. That is, which rules hire candidates which maximize the firm’s utility. Our committee game has a first round in which the members sequentially, by order of player number, say ‘yea’ or ‘nea’ to the candidate. If there are sufficient ‘yeas’ then she is tentatively hired; otherwise she is rejected. In the former case, members who said nea can veto the candidate in the second round. Thus the candidate is either hired, rejected, or vetoed. In the last case, the member casting a veto has one less to use on later candidates. We analyze equilibria where a player may say ‘yea’ to a candidate he would prefer not to hire, in order to force the other player to use up a valuable veto. We show that for the uniform candidate distribution there is a unique equilibrium and better candidates for the firm are hired when there are more vetoes. However we exhibit a candidate distribution where increasing the numbers of vetoes results in hiring worse candidates.     

Roof duality,complementation and persistency in quadratic 0–1 optimization

The paper is concerned with the ‘primal’ problem of maximizing a given quadratic pseudo-boolean function. Four equivalent problems are discussed—the primal, the ‘complementation’, the ‘discrete Rhys LP’ and the ‘weighted stability problem of a SAM graph’. Each of them has a relaxation—the ‘roof dual’, the ‘quadratic complementation,’ the ‘continuous Rhys LP’ and the ‘fractional weighted stability problem of a SAM graph’. The main result is that the four gaps associated with the four relaxations are equal. Furthermore, a solution to any of these problems leads at once to solutions of the other three equivalent ones. The four relaxations can be solved in polynomial time by transforming them to a bipartite maximum flow problem. The optimal solutions of the ‘roof-dual’ define ‘best’ linear majorantsp(x) off, having the following persistency property: if theith coefficient inp is positive (negative) thenx _i=1 (0) in every optimum of the primal problem. Several characterizations are given for the case where these persistency results cannot be used to fix any variable of the primal. On the other hand, a class of gap-free functions (properly including the supermodular ones) is exhibited.     

A two stage stochastic equilibrium model for electricity markets with two way contracts

This paper investigates generators’ strategic behaviors in contract signing in the forward market and power transaction in the electricity spot market. A stochastic equilibrium program with equilibrium constraints (SEPEC) model is proposed to characterize the interaction of generators’ competition in the two markets. The model is an extension of a similar model proposed by Gans et al. (Aust J Manage 23:83–96, 1998) for a duopoly market to an oligopoly market. The main results of the paper concern the structure of a Nash–Cournot equilibrium in the forward-spot market: first, we develop a result on the existence and uniqueness of the equilibrium in the spot market for every demand scenario. Then, we show the monotonicity and convexity of each generator’s dispatch quantity in the spot equilibrium by taking it as a function of the forward contracts. Finally, we establish some sufficient conditions for the existence of a local and global Nash equilibrium in the forward-spot markets. Numerical experiments are carried out to illustrate how the proposed SEPEC model can be used to analyze interactions of the markets.     

Dual-Role Based Pricing in a Dynamic and Competitive Environment

The dual role of price, as a product attribute signaling quality and as a measure of sacrifice, serving as a benchmark for comparing the utility gains from superior product quality, is now well established in the marketing and economic literature. However, knowledge about their long-run impact and the influence of competition on these effects still remains very sparse. In the current paper, with reference to a dynamic and competitive framework, an analytical model is proposed to help determining optimal decision rules for price incorporating both roles. The main results are as follows: (i) The optimal pricing policy is determined as a Nash equilibrium strategy. (ii) The resulting equilibrium price is higher than an equilibrium that disregards the carryover price effects. (iii) For a symmetric competition, we provide normative rules on how firms should set prices as a function of the perceived quality; particularly, how the price should be set initially, when there is little product familiarity and the perceived quality is low, and how this price should vary as the perceived quality increases. (iv) At steady state, we find that the level of equilibrium margin, in percentage terms, decreases with the elasticity of demand with respect to the brand price, but this decrease is moderated by the elasticity of demand with respect to the brand perceived quality, the cross elasticity of demand with respect to the competitor’s perceived quality and the effect of the competitor’s current price on the firm’s perceived quality deterioration. The author thanks Konstantin Kogan for helpful discussions and comments.     

On Nash Equilibria for Noncooperative Games Governed by the Burgers Equation

Existence of a Nash equilibrium in a noncooperative game governed by the one-dimensional Burgers equation, proposed in the case of pointwise controls in Ref. 1, is proved under data qualifications that guarantee the diffusion term in the Burgers’ equation to be dominant enough with respect to the uniform convexity of the payoffs. This work was partly supported by Grants 201/03/0934 (GA čR) and MSM 0021620839 (MšMT čR). Inspiring discussions with Angel M. Ramos are acknowledged.     

Potential,value, and coalition formation

In this paper, a simple probabilistic model of coalition formation provides a unified interpretation for several extensions of the Shapley value. Weighted Shapley values, semivalues, weak (weighted or not) semivalues, and the Shapley value itself appear as variations of this model. Moreover, some notions that have been introduced in the search of alternatives to Shapley’s seminal characterization, as ‘balanced contributions’ and the ‘potential’ are reinterpreted from this point of view. Natural relationships of these conditions with some mentioned families of ‘values’ are shown. These reinterpretations strongly suggest that these conditions are more naturally interpreted in terms of coalition formation than in terms of the classical notion of ‘value.’      

Experiments with an interactive paired comparison simplex method for molp problems

In this paper, an interactive paired comparison simplex based method formultiple objective linear programming (MOLP) problems is developed and compared to other interactive MOLP methods. The decision maker (DM)’s utility function is assumed to be unknown, but is an additive function of his known linearized objective functions. A test for ‘utility efficiency’ for MOLP problems is developed to reduce the number of efficient extreme points generated and the number of questions posed to the DM. The notion of ‘strength of preference ’ is developed for the assessment of the DM’s unknown utility function where he can express his preference for a pair of extreme points as ‘strong ’, ‘weak ’, or ‘almost indifferent ’. The problem of ‘inconsistency of the DM’ is formalized and its resolution is discussed. An example of the method and detailed computational results comparing it with other interactive MOLP methods are presented. Several performance measures for comparative evaluations of interactive multiple objective programming methods are also discussed. All rights reserved. This study, or parts thereof, may not be reproduced in any form without written permission of the authors.     

Quaternion Polar Representation with a Complex Modulus and Complex Argument Inspired by the Cayley-Dickson Form

We present a new polar representation of quaternions inspired by the Cayley-Dickson representation. In this new polar representation, a quaternion is represented by a pair of complex numbers as in the Cayley-Dickson form, but here these two complex numbers are a complex ‘modulus’ and a complex ‘argument’. As in the Cayley-Dickson form, the two complex numbers are in the same complex plane (using the same complex root of −1), but the complex phase is multiplied by a different complex root of −1 in the exponential function. We show how to calculate the ‘modulus’ and ‘argument’ from an arbitrary quaternion in Cartesian form.     

Artistic Expression Goes Green

The paper is a critical discussion of the rich and insightful final chapter of Mitchell Green’s Self-Expression. There, Green seeks to elucidate the compelling, but inchoate intuition that when we’re fully and most expertly expressing ourselves, we can ‘push out’ from within not just our inner representations, but also the ways that we feel. I question, first, whether this type of ‘qualitative expression’ is really distinct from the other expressive forms that Green explores, and also whether it’s genuinely ‘expressive’. I then scrutinize the nature of the ‘qualitative congruences’ that lie at the heart of Green’s theory; and I wonder whether they can play the role Green claims they can in providing a novel account of artistic expression.     

Non-additive anonymous games

This paper introduces a class of non-additive anonymous games where agents are assumed to be uncertain (in the sense of Knight) about opponents’ strategies and about the initial distribution over players’ characteristics in the game. We model uncertainty by non-additive measures or capacities and prove the Cournot–Nash equilibrium existence theorem for this class of games. Equilibrium distribution can be symmetrized under milder conditions than in the case of additive games. In particular, it is not required for the space characteristics to be atomless under capacities. The set-valued map of the Cournot–Nash equilibria is upper-semicontinuous as a function of initial beliefs of the players for non-additive anonymous games.