Bargaining in the shadow of the Law - using utility functions to support legal negotiation

Most dispute resolution is settled by negotiation rather than litigation. However, such bargaining often occurs in the shadow of the law. To help support interest-based negotiation, we explore the use of utility functions to support negotiation analysis. We discuss in detail a utility function we have developed in the area of family-law mediation. This function is currently being used as the basis of an online dispute resolution system.

Evaluating public risk preferences in forest land-use choices using multi-attribute utility theory

Forest policy decisions inherently involve multiple attributes and risk and uncertainty as they largely deal with complex biological, ecological, and socio-political systems. Identifying risk preferences and quantifying their inter-relationships and tradeoffs are useful in formulating better forest policy. Often, technocrats and experts deal with risky decisions, but ideally, stakeholder risk characteristics should be explicitly considered in making policy decisions. This paper analysed societal risk preferences on public forest land-use attributes using multi-attribute utility theory (MAUT). The results indicate significant risk-averse behaviour towards old-growth forest conservation and forest-based recreation but less risk-averse behaviour towards native timber extraction. Overall, the respondents preferred a more conservative forest land-use option, which is consistent with their risk attitudes. The method provides insights into risk preferences of forest stakeholders, which could lead to better understanding of forest management conflicts. Moreover, the method explicitly distinguishes the technical and value components of the decision and is useful in unravelling public risk preferences in multiple-use forest planning situations.

Computational exploration of the biological basis of Black-Scholes expected utility function

It has often been argued that there exists an underlying biological basis of utility functions. Taking this line of argument a step further in this paper, we have aimed to computationally demonstrate the biological basis of the Black-Scholes functional form as applied to classical option pricing and hedging theory. The evolutionary optimality of the classical Black-Scholes function has been computationally established by means of a haploid genetic algorithm model. The objective was to minimize the dynamic hedging error for a portfolio of assets that is built to replicate the payoff from a European multi-asset option. The functional form that is seen to evolve over successive generations which best attains this optimization objective is the classical Black-Scholes function extended to a multiasset scenario.

Utility-based summarization of home videos

The aim of this work is to devise an effective method for static summarization of home video sequences. Based on the premise that the user watching a summary is interested in people related (how many, who, emotional state) or activity related aspects, we formulate a novel approach to video summarization that works to specifically expose relevant video frames that make the content spotting tasks possible. Unlike existing approaches, which work on low-level features which often produce the summary not appealing to the viewer due to the semantic gap between low-level features and high-level concepts, our approach is driven by various utility functions (identity count, identity recognition, emotion recognition, activity recognition, sense of space) that use the results of face detection, face clustering, shot clustering and within cluster frame alignment. The summarization problem is then treated as the problem of extracting the set of key frames that have the maximum combined utility.

Migration, unemployment and trade

Migration, Unemployment and Trade focuses on the issues of migration, welfare and unemployment in a trade and development framework. Several chapters of the book analyze the implications of internal labor mobility in a model designed to highlight its implications for regional welfare, urban unemployment, rural-urban dichotomy and structural adjustment. An important innovation in this work is the disaggregation of the economy and the use of separate utility functions to highlight non-homogeneity of preferences. The book also deals with international mobility of factors in different frameworks. In particular it concentrates on the highly emotive issue of legal and illegal migration. Thus this work incorporates interesting and important features of labor economics and factor mobility into trade and distortion theory.

Strategies for agent-based negotiation in e-trade

£-negotiation handles negotiation over the Internet without human supervision and has shown effectiveness in concluding verifiable and more favorable agreements in a reasonably short time. In this chapter, the authors discuss the negotiation 5ystem and its components with particular emphasis on negotiation strategies. A negotiation strategy defines strategic tactics, which advise on the proper action to select from a set of possible actions that optimizes negotiation outcomes. A strategy should integrate negotiation goals and reactive attitudes. Usually, a fixed strategy is implemented during the course of negotiation regardless ofsignificant decision-makingfactors including market status, opponent :S profile, or eagerness for a negotiated goods/service. The chapter presents the main negotiation strategies and outlines the different decision-makingfactors that should be considered. A strategy uses a utility function to evaluate the offer of an opponent and advises on the generation of a counter offer or the best interaction. The authors finally discuss different utility functions presented in the literature.

Role of index bonds in an optimal dynamic asset allocation model with real subsistence consumption

We investigate the role of index bonds in a dynamic consumption and asset allocation model where the rate of real consumption at any given time cannot fall below a fixed level. An explicit form of the optimal consumption and portfolio rule for a class of Constant Relative Risk Aversion (CRRA) utility functions is derived. Consumption increases above the subsistence level only when wealth exceeds a threshold value. Risky investments in equity and nominal bonds are initially proportional to the excess of wealth over a lower bound, and then increase nonlinearly with wealth. The desirability of investing in the risky assets are related to the agent’s risk preference, the equity premium, and the inflation risk premium. The demand for index bonds is also obtained. The results should be useful for the management of defined benefit pension funds, university endowments, and other portfolios which have a withdrawal pre-commitment in real terms.

Multitasking: multiple, domain-specific cognitive functions in a virtual environment

Multitasking among three or more different tasks is a ubiquitous requirement of everyday cognition, yet rarely is it addressed in research on healthy adults who have had no specific training in multitasking skills. Participants completed a set of diverse subtasks within a simulated shopping mall and office environment, the Edinburgh Virtual Errands Test (EVET). The aim was to investigate how different cognitive functions, such as planning, retrospective and prospective memory, and visuospatial and verbal working memory, contribute to everyday multitasking. Subtasks were chosen to be diverse, and predictions were derived from a statistical model of everyday multitasking impairments associated with frontal-lobe lesions (Burgess, Veitch, de Lacy Costello, & Shallice, 2000b). Multiple regression indicated significant independent contributions from measures of retrospective memory, visuospatial working memory, and online planning, but not from independent measures of prospective memory or verbal working memory. Structural equation modelling showed that the best fit to the data arose from three underlying constructs, with Memory and Planning having a weak link, but with both having a strong directional pathway to an Intent construct that reflected implementation of intentions. Participants who followed their preprepared plan achieved higher scores than those who altered their plan during multitask performance. This was true regardless of whether the plan was efficient or poor. These results substantially develop and extend the Burgess et al. (2000b) model to healthy adults and yield new insight into the poorly understood area of everyday multitasking. The findings also point to the utility of using virtual environments for investigating this form of complex human cognition.