Divide-the-Dollar game revisited

In the Divide-the-Dollar (DD) game, two players simultaneously make demands to divide a dollar. Each player receives his demand if the sum of the demands does not exceed one, a payoff of zero otherwise. Note that, in the latter case, both parties are punished severely. A major setback of DD is that each division of the dollar is a Nash equilibrium outcome. Observe that, when the sum of the two demands x and y exceeds one, it is as if Player 1's demand x (or his offer (1−x) to Player 2) suggests that Player 2 agrees to λx < 1 times his demand y so that Player 1's demand and Player 2's modified demand add up to exactly one; similarly, Player 2's demand y (or his offer (1−y) to Player 1) suggests that Player 1 agrees to λyx so that λyx+y = 1. Considering this fact, we change DD's payoff assignment rule when the sum of the demands exceeds one; here in this case, each player's payoff becomes his demand times his λ; i.e., each player has to make the sacrifice that he asks his opponent to make. We show that this modified version of DD has an iterated strict dominant strategy equilibrium in which each player makes the egalitarian demand 1/2. We also provide a natural N-person generalization of this procedure.

Robert Boyle's theory of nature, with reference to his understanding of natural laws

Argues that the theory of nature-cum-theology and the view of of natural laws of the 17th century natural philosopher, Robert Boyle, were more complex and eclectic than is usually believed. Support is given for construing Boyle as a more complex thinker than previous scholars have suggested.

Rope dancer : a novel and accompanying essay

The thesis combines a novel and a critical essay. The novel tells of a group of people in Melbourne, some of whom write, party, have sex, take drugs, go climbing and die. The essay discusses four aspects of the novel: climbing fiction, Nietzsche in literature, place and fiction and character as hero.

Announcement effect on the credit spreads of US dollar Malaysian bonds

The main purpose of this paper is to extend the empirical research on the behavior of credit spreads on the USD denominated Malaysian bonds. We find that international political events have more influence on the changes of bond yield spreads from Malaysian USD issues than domestic events. Significant results are consistent across different issues. However, the resignation by the former Prime Minister, Dr Mahathir Mohamad, created a mixed response from the market. Using an error correction model, this study also found that the monetary policy by the US Federal Reserve has a long-term and significant impact on the behavior of the Malaysian USD issues. This study also provides further evidence that the current theoretical framework is sufficient to explain changes in the credit spread of bonds issued by the emerging market.

An empirical analysis of the Australian dollar swap spreads

This paper examines the relationship between the Australian dollar interest rate swap spread and the term structure of the interest rates, and also the determinants of interest rate swap spreads. For this purpose, we estimate the term structure of interest rates using the parsimonious fitting function of Nelson and Siegel [Journal of Business 60 (1987) 476] for the Australian government bonds and Australian interest rate swaps for certain maturities that are not available. We analyse the swap spread over the term structure of the government bonds and how changes in swap determinants affect the changes in swap spreads. The sample period covers the daily interval from 6 December 1996 to 31 December 1999.