The Relevance of the Principal-Agent Model for the Analysis of Public Policies : Do the Objectives Conflict ?

This paper aims to provide empirical support for the use of the principal-agent framework in the analysis of public sector and public policies. After reviewing the different conditions to be met for a relevant analysis of the relationship between population and government using the principal-agent theory, our paper focuses on the assumption of conflicting goals between the principal and the agent. A principal-agent analysis assumes in effect that inefficiencies may arise because principal and agent pursue different goals. Using data collected during an amalgamation project of two Swiss municipalities, we show the existence of a gap between the goals of the population and those of the government. Consequently, inefficiencies as predicted by the principal-agent model may arise during the implementation of a public policy, i.e. an amalgamation project. In a context of direct democracy where policies are regularly subjected to referendum, the conflict of objectives may even lead to a total failure of the policy at the polls.

The Swiss reform of the allocation of tasks : The conventions-programs as a new partnership model for vertical cooperation ?

This research examines the impacts of the Swiss reform of the allocation of tasks which was accepted in 2004 and implemented in 2008 to "re-assign" the responsibilities between the federal government and the cantons. The public tasks were redistributed, according to the leading and fundamental principle of subsidiarity. Seven tasks came under exclusive federal responsibility; ten came under the control of the cantons; and twenty-two "common tasks" were allocated to both the Confederation and the cantons. For these common tasks it wasn't possible to separate the management and the implementation. In order to deal with nineteen of them, the reform introduced the conventions-programs (CPs), which are public law contracts signed by the Confederation with each canton. These CPs are generally valid for periods of four years (2008-11, 2012-15 and 2016-19, respectively). The third period is currently being prepared. By using the principal-agent theory I examine how contracts can improve political relations between a principal (Confederation) and an agent (canton). I also provide a first qualitative analysis by examining the impacts of these contracts on the vertical cooperation and on the implication of different actors by focusing my study on five CPs - protection of cultural heritage and conservation of historic monuments, encouragement of the integration of foreigners, economic development, protection against noise and protection of the nature and landscape - applied in five cantons, which represents twenty-five cases studies.

Interactive Epistemology and Reasoning: On the Foundations of Game Theory

Game theory describes and analyzes strategic interaction. It is usually distinguished between static games, which are strategic situations in which the players choose only once as well as simultaneously, and dynamic games, which are strategic situations involving sequential choices. In addition, dynamic games can be further classified according to perfect and imperfect information. Indeed, a dynamic game is said to exhibit perfect information, whenever at any point of the game every player has full informational access to all choices that have been conducted so far. However, in the case of imperfect information some players are not fully informed about some choices. Game-theoretic analysis proceeds in two steps. Firstly, games are modelled by so-called form structures which extract and formalize the significant parts of the underlying strategic interaction. The basic and most commonly used models of games are the normal form, which rather sparsely describes a game merely in terms of the players' strategy sets and utilities, and the extensive form, which models a game in a more detailed way as a tree. In fact, it is standard to formalize static games with the normal form and dynamic games with the extensive form. Secondly, solution concepts are developed to solve models of games in the sense of identifying the choices that should be taken by rational players. Indeed, the ultimate objective of the classical approach to game theory, which is of normative character, is the development of a solution concept that is capable of identifying a unique choice for every player in an arbitrary game. However, given the large variety of games, it is not at all certain whether it is possible to device a solution concept with such universal capability. Alternatively, interactive epistemology provides an epistemic approach to game theory of descriptive character. This rather recent discipline analyzes the relation between knowledge, belief and choice of game-playing agents in an epistemic framework. The description of the players' choices in a given game relative to various epistemic assumptions constitutes the fundamental problem addressed by an epistemic approach to game theory. In a general sense, the objective of interactive epistemology consists in characterizing existing game-theoretic solution concepts in terms of epistemic assumptions as well as in proposing novel solution concepts by studying the game-theoretic implications of refined or new epistemic hypotheses. Intuitively, an epistemic model of a game can be interpreted as representing the reasoning of the players. Indeed, before making a decision in a game, the players reason about the game and their respective opponents, given their knowledge and beliefs. Precisely these epistemic mental states on which players base their decisions are explicitly expressible in an epistemic framework. In this PhD thesis, we consider an epistemic approach to game theory from a foundational point of view. In Chapter 1, basic game-theoretic notions as well as Aumann's epistemic framework for games are expounded and illustrated. Also, Aumann's sufficient conditions for backward induction are presented and his conceptual views discussed. In Chapter 2, Aumann's interactive epistemology is conceptually analyzed. In Chapter 3, which is based on joint work with Conrad Heilmann, a three-stage account for dynamic games is introduced and a type-based epistemic model is extended with a notion of agent connectedness. Then, sufficient conditions for backward induction are derived. In Chapter 4, which is based on joint work with Jérémie Cabessa, a topological approach to interactive epistemology is initiated. In particular, the epistemic-topological operator limit knowledge is defined and some implications for games considered. In Chapter 5, which is based on joint work with Jérémie Cabessa and Andrés Perea, Aumann's impossibility theorem on agreeing to disagree is revisited and weakened in the sense that possible contexts are provided in which agents can indeed agree to disagree.

Three essays on the psychology of investment and financial markets

Préface My thesis consists of three essays where I consider equilibrium asset prices and investment strategies when the market is likely to experience crashes and possibly sharp windfalls. Although each part is written as an independent and self contained article, the papers share a common behavioral approach in representing investors preferences regarding to extremal returns. Investors utility is defined over their relative performance rather than over their final wealth position, a method first proposed by Markowitz (1952b) and by Kahneman and Tversky (1979), that I extend to incorporate preferences over extremal outcomes. With the failure of the traditional expected utility models in reproducing the observed stylized features of financial markets, the Prospect theory of Kahneman and Tversky (1979) offered the first significant alternative to the expected utility paradigm by considering that people focus on gains and losses rather than on final positions. Under this setting, Barberis, Huang, and Santos (2000) and McQueen and Vorkink (2004) were able to build a representative agent optimization model which solution reproduced some of the observed risk premium and excess volatility. The research in behavioral finance is relatively new and its potential still to explore. The three essays composing my thesis propose to use and extend this setting to study investors behavior and investment strategies in a market where crashes and sharp windfalls are likely to occur. In the first paper, the preferences of a representative agent, relative to time varying positive and negative extremal thresholds are modelled and estimated. A new utility function that conciliates between expected utility maximization and tail-related performance measures is proposed. The model estimation shows that the representative agent preferences reveals a significant level of crash aversion and lottery-pursuit. Assuming a single risky asset economy the proposed specification is able to reproduce some of the distributional features exhibited by financial return series. The second part proposes and illustrates a preference-based asset allocation model taking into account investors crash aversion. Using the skewed t distribution, optimal allocations are characterized as a resulting tradeoff between the distribution four moments. The specification highlights the preference for odd moments and the aversion for even moments. Qualitatively, optimal portfolios are analyzed in terms of firm characteristics and in a setting that reflects real-time asset allocation, a systematic over-performance is obtained compared to the aggregate stock market. Finally, in my third article, dynamic option-based investment strategies are derived and illustrated for investors presenting downside loss aversion. The problem is solved in closed form when the stock market exhibits stochastic volatility and jumps. The specification of downside loss averse utility functions allows corresponding terminal wealth profiles to be expressed as options on the stochastic discount factor contingent on the loss aversion level. Therefore dynamic strategies reduce to the replicating portfolio using exchange traded and well selected options, and the risky stock.

Which subgroup of patients with rheumatoid arthritis benefits from switching to rituximab versus alternative anti-tumour necrosis factor (TNF) agents after previous failure of an anti-TNF agent?

BACKGROUND: Patients with rheumatoid arthritis (RA) with an inadequate response to TNF antagonists (aTNFs) may switch to an alternative aTNF or start treatment from a different class of drugs, such as rituximab (RTX). It remains unclear in which clinical settings these therapeutic strategies offer most benefit. OBJECTIVE: To analyse the effectiveness of RTX versus alternative aTNFs on RA disease activity in different subgroups of patients. METHODS: A prospective cohort study of patients with RA who discontinued at least one aTNF and subsequently received either RTX or an alternative aTNF, nested within the Swiss RA registry (SCQM-RA) was carried out. The primary outcome, longitudinal improvement in 28-joint count Disease Activity Score (DAS28), was analysed using multivariate regression models for longitudinal data and adjusted for potential confounders. RESULTS: Of the 318 patients with RA included; 155 received RTX and 163 received an alternative aTNF. The relative benefit of RTX varied with the type of prior aTNF failure: when the motive for switching was ineffectiveness to previous aTNFs, the longitudinal improvement in DAS28 was significantly better with RTX than with an alternative aTNF (p = 0.03; at 6 months, -1.34 (95% CI -1.54 to -1.15) vs -0.93 (95% CI -1.28 to -0.59), respectively). When the motive for switching was other causes, the longitudinal improvement in DAS28 was similar for RTX and alternative aTNFs (p = 0.40). These results were not significantly modified by the number of previous aTNF failures, the type of aTNF switches, or the presence of co-treatment with a disease-modifying antirheumatic drug. CONCLUSION: This observational study suggests that in patients with RA who have stopped a previous aTNF treatment because of ineffectiveness changing to RTX is more effective than switching to an alternative aTNF.

Seizures after single-agent overdose with pharmaceutical drugs: Analysis of cases reported to a poison center.

Abstract Context. Seizures during intoxications with pharmaceuticals are a well-known complication. However, only a few studies report on drugs commonly involved and calculate the seizure potential of these drugs. Objectives. To identify the pharmaceutical drugs most commonly associated with seizures after single-agent overdose, the seizure potential of these pharmaceuticals, the age-distribution of the cases with seizures and the ingested doses. Methods. A retrospective review of acute single-agent exposures to pharmaceuticals reported to the Swiss Toxicological Information Centre (STIC) between January 1997 and December 2010 was conducted. Exposures which resulted in at least one seizure were identified. The seizure potential of a pharmaceutical was calculated by dividing the number of cases with seizures by the number of all cases recorded with that pharmaceutical. Data were analyzed using descriptive statistics. Results. We identified 15,441 single-agent exposures. Seizures occurred in 313 cases. The most prevalent pharmaceuticals were mefenamic acid (51 of the 313 cases), citalopram (34), trimipramine (27), venlafaxine (23), tramadol (15), diphenhydramine (14), amitriptyline (12), carbamazepine (11), maprotiline (10), and quetiapine (10). Antidepressants were involved in 136 cases. Drugs with a high seizure potential were bupropion (31.6%, seizures in 6 of 19 cases, 95% CI: 15.4-50.0%), maprotiline (17.5%, 10/57, 95% CI: 9.8-29.4%), venlafaxine (13.7%, 23/168, 95% CI: 9.3-19.7%), citalopram (13.1%, 34/259, 95% CI: 9.5-17.8%), and mefenamic acid (10.9%, 51/470, 95% CI: 8.4-14.0%). In adolescents (15-19y/o) 23.9% (95% CI: 17.6-31.7%) of the cases involving mefenamic acid resulted in seizures, but only 5.7% (95% CI: 3.3-9.7%) in adults (≥ 20y/o; p < 0.001). For citalopram these numbers were 22.0% (95% CI: 12.8-35.2%) and 10.9% (95% CI: 7.1-16.4%), respectively (p = 0.058). The probability of seizures with mefenamic acid, citalopram, trimipramine, and venlafaxine increased as the ingested dose increased. Conclusions. Antidepressants were frequently associated with seizures in overdose, but other pharmaceuticals, as mefenamic acid, were also associated with seizures in a considerable number of cases. Bupropion was the pharmaceutical with the highest seizure potential even if overdose with bupropion was uncommon in our sample. Adolescents might be more susceptible to seizures after mefenamic acid overdose than adults. "Part of this work is already published as a conference abstract for the XXXIV International Congress of the European Association of Poisons Centres and Clinical Toxicologists (EAPCCT) 27-30 May 2014, Brussels, Belgium." Abstract 8, Clin Toxicol 2014;52(4):298.

Oral insecticidal activity of root colonizing Pseudomonas fluorescens CHA0: a biocontrol agent with potential to control plant pests and diseases

The application of microbial biocontrol agents for the control of fungal plant diseases and plant insect pests is a promising approach in the development of environmentally benign pest management strategies. The ideal biocontrol organism would be a bacterium or a fungus with activity against both, insect pests and fungal pathogens. Here we demonstrate the oral insecticidal activity of the root colonizing Pseudomonas fluorescens CHA0, which is so far known for its capacity to efficiently suppress fungal plant pathogens. Feeding assays with CHA0-sprayed leaves showed that this strain displays oral insecticidal activity and is able to efficiently kill larvae of three important insect pests. We further show data indicating that the Fit insect toxin produced by CHA0 and also metabolites controlled by the global regulator GacA contribute to oral insect toxicity.