Real options and game theoretical approaches to real estate development projects: multiple equilibria and the implications of different tie-breaking rules

This paper contributes to a fast growing literature which introduces game theory in the analysis of real option investments in a competitive setting. Specifically, in this paper we focus on the issue of multiple equilibria and on the implications that different equilibrium selections may have for the pricing of real options and for subsequent strategic decisions. We present some theoretical results of the necessary conditions to have multiple equilibria and we show under which conditions different tie-breaking rules result in different economic decisions. We then present a numerical exercise using the in formation set obtained on a real estate development in South London. We find that risk aversion reduces option value and this reduction decreases marginally as negative externalities decrease.

Theoretical insights into bacterial chemotaxis

Research into understanding bacterial chemotactic systems has become a paradigm for Systems Biology. Experimental and theoretical researchers have worked hand-in-hand for over 40 years to understand the intricate behavior driving bacterial species, in particular how such small creatures, usually not more than 5 µm in length, detect and respond to small changes in their extracellular environment. In this review we highlight the importance that theoretical modeling has played in providing new insight and understanding into bacterial chemotaxis. We begin with an overview of the bacterial chemotaxis sensory response, before reviewing the role of theoretical modeling in understanding elements of the system on the single cell scale and features underpinning multiscale extensions to population models. WIREs Syst Biol Med 2012 doi: 10.1002/wsbm.1168 For further resources related to this article, please visit the WIREs website.

Receptor binding profiles of avian influenza virus hemagglutinin subtypes on human cells as a predictor of pandemic potential

The host adaptation of influenza virus is partly dependent on the sialic acid (SA) isoform bound by the viral hemagglutinin (HA). Avian influenza viruses preferentially bind the α-2,3 SA and human influenza viruses the α-2,6 isoform. Each isoform is predominantly associated with different surface epithelial cell types of the human upper airway. Using recombinant HAs and human tracheal airway epithelial cells in vitro and ex vivo, we show that many avian HA subtypes do not adhere to this canonical view of SA specificity. The propensity of avian viruses to adapt to human receptors may thus be more widespread than previously supposed.

A theoretical framework for energy and momentum consistency in subgrid-scale parameterization for climate models

A theoretical framework for the joint conservation of energy and momentum in the parameterization of subgrid-scale processes in climate models is presented. The framework couples a hydrostatic resolved (planetary scale) flow to a nonhydrostatic subgrid-scale (mesoscale) flow. The temporal and horizontal spatial scale separation between the planetary scale and mesoscale is imposed using multiple-scale asymptotics. Energy and momentum are exchanged through subgrid-scale flux convergences of heat, pressure, and momentum. The generation and dissipation of subgrid-scale energy and momentum is understood using wave-activity conservation laws that are derived by exploiting the (mesoscale) temporal and horizontal spatial homogeneities in the planetary-scale flow. The relations between these conservation laws and the planetary-scale dynamics represent generalized nonacceleration theorems. A derived relationship between the wave-activity fluxes-which represents a generalization of the second Eliassen-Palm theorem-is key to ensuring consistency between energy and momentum conservation. The framework includes a consistent formulation of heating and entropy production due to kinetic energy dissipation.

Observational tracking of the 2D structure of coronal mass ejections between the sun and 1 AU

The Solar TErrestrial RElations Observatory (STEREO) provides high cadence and high resolution images of the structure and morphology of coronal mass ejections (CMEs) in the inner heliosphere. CME directions and propagation speeds have often been estimated through the use of time-elongation maps obtained from the STEREO Heliospheric Imager (HI) data. Many of these CMEs have been identified by citizen scientists working within the SolarStormWatch project ( www.solarstormwatch.com ) as they work towards providing robust real-time identification of Earth-directed CMEs. The wide field of view of HI allows scientists to directly observe the two-dimensional (2D) structures, while the relative simplicity of time-elongation analysis means that it can be easily applied to many such events, thereby enabling a much deeper understanding of how CMEs evolve between the Sun and the Earth. For events with certain orientations, both the rear and front edges of the CME can be monitored at varying heliocentric distances (R) between the Sun and 1 AU. Here we take four example events with measurable position angle widths and identified by the citizen scientists. These events were chosen for the clarity of their structure within the HI cameras and their long track lengths in the time-elongation maps. We show a linear dependency with R for the growth of the radial width (W) and the 2D aspect ratio (χ) of these CMEs, which are measured out to ≈ 0.7 AU. We estimated the radial width from a linear best fit for the average of the four CMEs. We obtained the relationships W=0.14R+0.04 for the width and χ=2.5R+0.86 for the aspect ratio (W and R in units of AU).

Convective quasi–equilibrium

The concept of convective quasi–equilibrium (CQE) is a key ingredient in order to understand the role of deep moist convection in the atmosphere. It has been used as a guiding principle to develop almost all convective parameterizations and provides a basic theoretical framework for large–scale tropical dynamics. The CQE concept as originally proposed by Arakawa and Schubert [1974] is systematically reviewed from wider perspectives. Various interpretations and extensions of Arakawa and Schubert’s CQE are considered in terms of both a thermodynamic analogy and as a dynamical balance. The thermodynamic interpretations can be more emphatically embraced as a homeostasis. The dynamic balance interpretations can be best understood by analogy with the slow manifold. Various criticisms of CQE can be avoided by taking the dynamic balance interpretation. Possible limits of CQE are also discussed, including the importance of triggering in many convective situations, as well as the possible self–organized criticality of tropical convection. However, the most intriguing aspect of the CQE concept is that, in spite of many observational tests supporting and interpreting it in many different senses, it has 1never been established in a robust manner based on a systematic analysis of the cloud–work function budget by observations as was originally defined.

Estimation of the friction velocity in stably stratified boundary-layer flows over hills

A method is suggested for the calculation of the friction velocity for stable turbulent boundary-layer flow over hills. The method is tested using a continuous upstream mean velocity profile compatible with the propagation of gravity waves, and is incorporated into the linear model of Hunt, Leibovich and Richards with the modification proposed by Hunt, Richards and Brighton to include the effects of stability, and the reformulated solution of Weng for the near-surface region. Those theoretical results are compared with results from simulations using a non-hydrostatic microscale-mesoscale two-dimensional numerical model, and with field observations for different values of stability. These comparisons show a considerable improvement in the behaviour of the theoretical model when the friction velocity is calculated using the method proposed here, leading to a consistent variation of the boundary-layer structure with stability, and better agreement with observational and numerical data.

An analytical model of mountain wave drag for wind profiles with shear and curvature

An analytical model is developed to predict the surface drag exerted by internal gravity waves on an isolated axisymmetric mountain over which there is a stratified flow with a velocity profile that varies relatively slowly with height. The model is linear with respect to the perturbations induced by the mountain, and solves the Taylor–Goldstein equation with variable coefficients using a Wentzel–Kramers–Brillouin (WKB) approximation, formally valid for high Richardson numbers, Ri. The WKB solution is extended to a higher order than in previous studies, enabling a rigorous treatment of the effects of shear and curvature of the wind profile on the surface drag. In the hydrostatic approximation, closed formulas for the drag are derived for generic wind profiles, where the relative magnitude of the corrections to the leading-order drag (valid for a constant wind profile) does not depend on the detailed shape of the orography. The drag is found to vary proportionally to Ri21, decreasing as Ri decreases for a wind that varies linearly with height, and increasing as Ri decreases for a wind that rotates with height maintaining its magnitude. In these two cases the surface drag is predicted to be aligned with the surface wind. When one of the wind components varies linearly with height and the other is constant, the surface drag is misaligned with the surface wind, especially for relatively small Ri. All these results are shown to be in fairly good agreement with numerical simulations of mesoscale nonhydrostatic models, for high and even moderate values of Ri.

Exploring the interplay between natural decadal variability and anthropogenic climate change in summer rainfall over China. Part I: Observational evidence

Summer rainfall over China has experienced substantial variability on longer time scales during the last century, and the question remains whether this is due to natural, internal variability or is part of the emerging signal of anthropogenic climate change. Using the best available observations over China, the decadal variability and recent trends in summer rainfall are investigated with the emphasis on changes in the seasonal evolution and on the temporal characteristics of daily rainfall. The possible relationships with global warming are reassessed. Substantial decadal variability in summer rainfall has been confirmed during the period 1958–2008; this is not unique to this period but is also seen in the earlier decades of the twentieth century. Two dominant patterns of decadal variability have been identified that contribute substantially to the recent trend of southern flooding and northern drought. Natural decadal variability appears to dominate in general but in the cases of rainfall intensity and the frequency of rainfall days, particularly light rain days, then the dominant EOFs have a rather different character, being of one sign over most of China, and having principal components (PCs) that appear more trendlike. The increasing intensity of rainfall throughout China and the decrease in light rainfall days, particularly in the north, could at least partially be of anthropogenic origin, both global and regional, linked to increased greenhouse gases and increased aerosols.

Towards a theoretical framework for creative participation : how personal characteristics influence employees' willingness to contribute ideas

To retain competitiveness, succeed and flourish, organizations are forced to continuously innovate. This drive for innovation is not solely limited to product/process innovation but more profoundly relates to a continuous process of improving how organizations work internally, requiring a constant stream of ideas and suggestions from motivated employees. In this chapter we investigate some recent developments and propose a conceptual framework for creative participation as a personality driven interface between creativity and innovation. Under the assumption that employees’ intrinsic willingness to contribute novel ideas and solutions requires a set of personal characteristics and necessary skill that might well be unique to each organizational unit, the chapter then explores personal characteristics associated with creativity, innovation and innovative behavior. Various studies on the correlation between creativity and personality types are also reviewed. The chapter provides a discussion of solutions and future development together with recommendations for the future research.

Optimizing the methods of synthesis for barium hexagonal ferrite: an experimental and theoretical study

M-type barium hexaferrite (BaM) is a hard ferrite, crystallizing in space group P6(3)/mmc possessing a hexagonal magneto-plumbite structure, which consists of alternate hexagonal and spinel blocks. The structure of BaM is thus related to those of garnet and spinel ferrite. However the material has proved difficult to synthesize. By taking into account the presence of the spinel block in barium hexagonal ferrite, highly efficient new synthetic methods were devised with routes significantly different from existing ones. These successful variations in synthetic methods have been derived by taking into account a detailed investigation of the structural features of barium hexagonal ferrite and the least change principle whereby configuration changes are kept to a minimum. Thus considering the relevant mechanisms has helped to improve the synthesis efficiencies for both hydrothermal and co-precipitation methods by choosing conditions that invoke the formation of the cubic block or the less stable Fe3O4. The role played by BaFe2O4 in the synthesis is also discussed. The distribution of iron from reactants or intermediates among different sites was also successfully explained. The proposed mechanisms are based on the principle that the cubic block must be self-assembled to form the final product. Thus, it is believed that these formulated mechanisms should be helpful in designing experiments to obtain a deeper understanding of the synthesis process and to investigate the substitution of magnetic ions with doping ions.