Game-theoretic view on intermediated exchange

Intermediaries permeate modern economic exchange. Most classical models on intermediated exchange are driven by information asymmetry and inventory management. These two factors are of reduced significance in modern economies. This makes it necessary to develop models that correspond more closely to modern financial marketplaces. The goal of this dissertation is to propose and examine such models in a game theoretical context. The proposed models are driven by asymmetries in the goals of different market participants. Hedging pressure as one of the most critical aspects in the behavior of commercial entities plays a crucial role. The first market model shows that no equilibrium solution can exist in a market consisting of a commercial buyer, a commercial seller and a non-commercial intermediary. This indicates a clear economic need for non-commercial trading intermediaries: a direct trade from seller to buyer does not result in an equilibrium solution. The second market model has two distinct intermediaries between buyer and seller: a spread trader/market maker and a risk-neutral intermediary. In this model a unique, natural equilibrium solution is identified in which the supply-demand surplus is traded by the risk-neutral intermediary, whilst the market maker trades the remainder from seller to buyer. Since the market maker’s payoff for trading at the identified equilibrium price is zero, this second model does not provide any motivation for the market maker to enter the market. The third market model introduces an explicit transaction fee that enables the market maker to secure a positive payoff. Under certain assumptions on this transaction fee the equilibrium solution of the previous model applies and now also provides a financial motivation for the market maker to enter the market. If the transaction fee violates an upper bound that depends on supply, demand and riskaversity of buyer and seller, the market will be in disequilibrium.

Quickbird satellite imagery for riparian management : characterizing riparian filter strips and detecting concentrated flow in an agricultural watershed

Riparian ecology plays an important part in the filtration of sediments from upland agricultural lands. The focus of this work makes use of multispectral high spatial resolution remote sensing imagery (Quickbird by Digital Globe) and geographic information systems (GIS) to characterize significant riparian attributes in the USDA’s experimental watershed, Goodwin Creek, located in northern Mississippi. Significant riparian filter characteristics include the width of the strip, vegetation properties, soil properties, topography, and upland land use practices. The land use and vegetation classes are extracted from the remotely sensed image with a supervised maximum likelihood classification algorithm. Accuracy assessments resulted in an acceptable overall accuracy of 84 percent. In addition to sensing riparian vegetation characteristics, this work addresses the issue of concentrated flow bypassing a riparian filter. Results indicate that Quickbird multispectral remote sensing and GIS data are capable of determining riparian impact on filtering sediment. Quickbird imagery is a practical solution for land managers to monitor the effectiveness of riparian filtration in an agricultural watershed.

Relationship between instream habitat characteristics, emergent insects, and riparian bird communities

Streams and riparian areas can be intricately connected via physical and biotic interactions that influence habitat conditions and supply resource subsidies between these ecosystems. Streambed characteristics such as the size of substrate particles influence the composition and the abundance of emergent aquatic insects, which can be an important resource for riparian breeding birds. We predict fine sediment abundance in small headwater streams directly affects the composition and number of emergent insects while it may indirectly affect riparian bird assemblages. Streams with abundant fine sediments that embed larger substrates should have lower emergence of large insects such as phemeroptera, Plecoptera and Trichoptera. Streams with lower emergent insect abundance are predicted to support fewer breeding birds and may lack certain bird species that specialize on aquatic insects. This study examined relationships between streambed characteristics, and emergent insects (composition, abundance and biomass), and riparian breeding birds (abundance and richness) along headwater streams of the Otter River Watershed. The stream bed habitats of seven stream reaches were characterized using longitudinal surveys. Malaise traps were deployed to sample emergent aquatic insects. Riparian breeding birds were surveyed using fixed-radius point-counts. Streams differed within a wide range of fine sediment abundances. Total emergent aquatic insect abundance increased as coverage by instream substrates increased in diameter, while bird community was unresponsive to insect or stream features. Knowledge of stream and riparian relationships is important for understanding of food webs in these ecosystems, and it is useful for riparian forest conservation and improving land-use management to reduce sediment pollution in these systems.