This paper characterizes the ordinal utilities over the bounded infinite streams of payoffs that satisfy the time-value of money principle and an additivity property, and those that in addition are impatient. Building on this characterization, the paper introduces the concept of optimization that is robust to small imprecision in the specification of the preference, and proves that the set of feasible streams of payoffs of a finite Markov Decision Process admits such a robust optimization.
A sound legal infrastructure is critical to the development of the Israeli economy. In its absence, business people and private persons alike face difficulties in planning their actions. All too often they are obliged to turn to the courts of law. However, in the absence of a proper infrastructure, those do not themselves have the necessary tools to resolve the disputes. The matters at issue are not marginal. They have long-lasting consequences for the economy. The number of publicly-traded companies listed in Tel-Aviv Stock Exchange sank from 657 in 2008 to 461 in March 2016.
How good is a forecaster? Assume for concreteness that every day the forecaster issues a forecast of the type "the chance of rain tomorrow is 30%." A simple test one may conduct is to calculate the proportion of rainy days out of those days that the forecast was 30%, and compare it to 30%; and do the same for all other forecasts. A forecaster is said to be _calibrated_ if, in the long run, the differences between the actual proportions of rainy days and the forecasts are small—no matter what the weather really was.
The National Health Insurance Law is operated through several economic mechanisms that are meant to implement its vision. In this lecture we will present the main flaws of some of these mechanisms and propose ways to fix them. The lecture will be in hebrew.
This paper analyzes the optimal assignment of objects which arrive sequentially to agents organized in a waiting list. Applications include the assignment of social housing and organs for transplants. We analyze the optimal design of probabilistic queuing disciplines, punishment schemes, the optimal timing of applications and information releases. We consider three efficiency criteria: the vector of values of agents in the queue, the probability of misallocation and the expected waste.
Topic: Endogenous Financial Networks: Efficient Modularity and Why Shareholders Prevent It (joint work with Jonathon Hazell) We consider systemic risk in financial networks, by examining the conflict of interest between debt- and equity-holders. Through trading, banks can diversify their idiosyncratic risks and avoid failures following small shocks. However, the resulting interdependencies can cause multiple failures after large shocks.
Elath Hall, 2nd floor, Feldman Building, Edmond J. Safra Campus
Time discounting is a ubiquitous assumption in economic literature. We (re)explore the foundations of such time preferences. "Impatience" is defined as a preferences for experiencing the better states sooner rather than later, even when there is no uncertainty associated with the future. We show that, assuming consistency and some weak stationarity assumptions, impatience is incompatible with a meaningful notion of a risk-attitude (risk aversion/love/neutrality).On the other hand, if there is uncertainty associated with the future then discounting necessarily emerges.
Elath Hall, 2nd floor, Feldman Building, Edmond J. Safra Campus
A unified integral approach to all the calibration results in the literature -- from regular probabilistic calibration to smooth deterministic calibration -- using simple "hairy" fixed point and minimax results.
