Endogenous credit cycles

I develop an overlapping-generations framework in which changes in lending standards generateendogenous cycles. In my economy, entrepreneurs who are privately informed about thequality of their projects need to borrow funds. Intermediaries screen entrepreneurs both throughthe amount of investment undertaken and through the level of entrepreneurial net worth.I show that endogenous regime switches in financial contracts from pooling to separatingand vice-versa may generate fluctuations even in the absence of exogenous shocks. Whenthe economy is in the pooling (separating) regime, lending standards seem lax ( tight ) andinvestment is high (low). Differently from the existing literature, my model does not requireentrepreneurial net worth to be counter cyclycal or inconsequential for determining aggregateinvestment.

Charge dependent substrate activity of C3' and N3 functionalized, organometallic technetium and rhenium-labeled thymidine derivatives toward human thymidine kinase 1.

Human cytosolic thymidine kinase (hTK1) has proven to be a suitable target for the noninvasive imaging of cancer cell proliferation using radiolabeled thymidine analogues such as [(18)F]3'-fluoro-3'-deoxythymidine ([(18)F]FLT). A thymidine analogue for single photon emission computed tomography (SPECT), which incorporates the readily available and inexpensive nuclide technetium-99m, would be of considerable practical interest. hTK1 is known to accommodate modification of the structure of the natural substrate thymidine at the positions N3 and C3' and, to a lesser extent, C5. In this work, we used the copper-catalyzed azide-alkyne cycloaddition to synthesize two series of derivatives in which thymidine is functionalized at either the C3' or N3 position with chelating systems suitable for the M(CO)(3) core (M = (99m)Tc, Re). The click chemistry approach enabled complexes with different structures and overall charges to be synthesized from a common precursor. Using this strategy, the first organometallic hTK1 substrates in which thymidine is modified at the C3' position were identified. Phosphorylation of the organometallic derivatives was measured relative to thymidine. We have shown that the influence of the overall charge of the derivatives is dependent on the position of functionalization. In the case of the C3'-functionalized derivatives, neutral and anionic substrates were most readily phosphorylated (20-28% of the value for the parent ligand thymidine), whereas for the N3-functionalized derivatives, cationic and neutral complexes were apparently better substrates for the enzyme (14-18%) than anionic derivatives (9%).

Selling to consumers with endogenous types

For many goods (such as experience goods or addictive goods), consumers preferences may change over time. In this paper, we examine a monopolist s optimal pricing schedule when current consumption can affect a consumer s valuation in the future and valuations are unobservable. We assume that consumers are anonymous, i.e. the monopolist can t observe a consumer s past consumption history. For myopic consumers, the optimal consumption schedule is distorted upwards, involving substantial discounts for low valuation types. This pushes low types into higher valuations, from which rents can be extracted.For forward looking consumers, there may be a further upward distortion of consumption due to a reversal of the adverse selection effect; low valuation consumers now have a strong interest in consumption in order to increase their valuations. Firms will find it profitable to educate consumers and encourage forward looking behavior.

Endogenous price leadership

We consider a linear price setting duopoly game with di®erentiatedproducts and determine endogenously which of the players will lead andwhich will follow. While the follower role is most attractive for each firm, we show that waiting is more risky for the low cost firm so that,consequently, risk dominance considerations, as in Harsanyi and Selten(1988), allow the conclusion that only the high cost firm will choose towait. Hence, the low cost firm will emerge as the endogenous price leader.

Secretion of an endogenous subtilisin by Pichia pastoris strains GS115 and KM71.

The methylotrophic yeast Pichia pastoris is widely used for the expression of heterologous enzymes. While the purity of the desired expression product is of major importance for many applications, we found that recombinant enzymes produced in methanol medium were contaminated by a 37-kDa endogenous yeast protease. This enzyme was completely inhibited by phenylmethanesulfonyl fluoride (PMSF) but not by 1,10-phenanthroline, EDTA, and pepstatin A, suggesting the nature of a serine protease. Its secretion was abolished in P. pastoris strains GS115 and KM71 by specific mutagenesis of a subtilisin gene (SUB2) but not by inactivation of the gene encoding vacuolar proteinase B (PRB). Bioinformatic comparisons of Sub2 protein with subtilisins from other fungal genomes and phylogenetic analyses indicated that this enzyme is not an orthologue of the vacuolar protease cerevisin generally present in yeasts but is more closely related to another putative subtilisin found in a small number of yeast genomes. During growth of P. pastoris, Sub2 was produced as a secreted enzyme at a concentration of 10 microg/ml of culture supernatant after overexpression of the full-length SUB2 gene. During fermentative production of recombinant enzymes in methanol medium, 1 ml of P. pastoris culture supernatant was found to contain approximately 3 ng of Sub2, while the enzyme was not detected during growth in a medium containing glycerol as a carbon source. The mutant strain GS115-sub2 was subsequently used as a host for the production of recombinant proteases without endogenous subtilisin contamination.

Endogenous price leadership

We consider a linear price setting duopoly game with differentiated products and determine endogenously which of the players will lead and which will follow. While the follower role is most attractive for each firm, we show that waiting is more risky for the low cost firm so that, consequently, risk dominance considerations, as in Harsanyi and Selten (1988), allow the conclusion that only the highcost firm will choose to wait. Hence, the low cost firm will emerge as the endogenous price leader.

The cdc7 protein kinase is a dosage dependent regulator of septum formation in fission yeast.

Mutation of the Schizosaccharomyces pombe cdc7 gene prevents formation of the division septum and cytokinesis. We have cloned the cdc7 gene and show that it encodes a protein kinase which is essential for cell division. In the absence of cdc7 function, spore germination, DNA synthesis and mitosis are unaffected, but cells are unable to initiate formation of the division septum. Overexpression of p120cdc7 causes cell cycle arrest; cells complete mitosis and then undergo multiple rounds of septum formation without cell cleavage. This phenotype, which is similar to that resulting from inactivation of cdc16 protein, requires the kinase activity of p120cdc7. Mutations inactivating the early septation gene, cdc11, suppress the formation of multiple septa and allow cells to proliferate normally. If formation of the division septum is prevented by inactivation of either cdc14 or cdc15, p120cdc7 overproduction does not interfere with other events in the mitotic cell cycle. Septation is not induced by overexpression of p120cdc7 in G2 arrested cells, indicating that it does not bypass the normal dependency of septation upon initiation of mitosis. These findings indicate that the p120cdc7 protein kinase plays a key role in initiation of septum formation and cytokinesis in fission yeast and suggest that p120cdc7 interacts with the cdc11 protein in the control of septation.

Country asymmetries, endogenous product choice and the speed of trade liberalization

In a world with two countries which differ in size, we study theimpact of (the speed of) trade liberalization on firms' profitsand total welfare of the countries involved. Firms correctlyanticipate the pace of trade liberalization and take it intoaccount when deciding on their product choices, which areendogenously determined at the beginning of the game. Competitionin the marketplace then occurs either on quantities or on prices.As long as the autarkic phase continues, local firms are nationalmonopolists. When trade liberalization occurs, firms compete in aninternational duopoly. We analyze trade effects by using twodifferent models of product differentiation. Across all thespecifications adopted (and independently of the price v. quantitycompetition hypothesis), total welfare always unambiguously riseswith the speed of trade liberalization: Possible losses by firmsare always outweighed by consumers' gains, which come under theform of lower prices, enlarged variety of higher average qualitiesavailable. The effect on profits depends on the type of industryanalyzed. Two results in particular seem to be worth of mention.With vertical product differentiation and fixed costs of qualityimprovements, the expected size of the market faced by the firmsdetermines the incentive to invest in quality. The longer the periodof autarky, the lower the possibility that the firm from the smallcountry would be producing the high quality and be the leader in theinternational market when it opens. On the contrary, when trade opensimmediately, national markets do not play any role and firms fromdifferent countries have the same opportunity to become the leader.Hence, immediate trade liberalization might be in the interest ofproducers in the small country. In general, the lower the size of thesmall country, the more likely its firm will gain from tradeliberalization. Losses from the small country firm can arise when itis relegated to low quality good production and the domestic marketsize is not very small. With horizontal product differentiation (thehomogeneous good case being a limit case of it when costs ofdifferentiation tend to infinity), investments in differentiationbenefit both firms in equal manner. Firms from the small country do notrun the risk of being relegated to a lower competitive position undertrade. As a result, they would never lose from it. Instead, firms fromthe large country may still incur losses from the opening of trade whenthe market expansion effect is low (i.e. when the country is very largerelative to the other).

Endogenous Stackelberg leadership

We consider a linear quantity setting duopoly game and analyzewhich of the players will commit when both players have the possibility todo so. To that end, we study a 2-stage game in which each player caneither commit to a quantity in stage 1 or wait till stage 2. We show thatcommitting is more risky for the high cost firm and that, consequently,risk dominance considerations, as in Harsanyi and Selten (1988), allowthe conclusion that only the low cost firm will choose to commit.Hence, the low cost firm will emerge as the endogenous Stackelberg leader.

Endogenous policy leads to inefficient risk sharing

We analyze risk sharing and fiscal spending in a two-region model withcomplete markets. Fiscal policy determines tax rates for each state ofnature. When fiscal policy is decentralized, it can be used to affect prices of securities. To manipulate prices to their beneffit, regionschoose pro-cyclical fiscal spending. This leads to incomplete risk sharing,despite the existence of complete markets and the absence of aggregaterisk. When a fiscal union centralizes fiscal policy, securities pricescan no longer be manipulated and complete risk sharing ensues. If regionsare homogeneous, median income residents of both regions prefer the fiscalunion. If they are heterogeneous, the median resident of the rich regionprefers the decentralized setting.

Variations in IB1/JIP1 expression regulate susceptibility of beta-cells to cytokine-induced apoptosis irrespective of C-Jun NH2-terminal kinase signaling.

We previously reported that interleukin-1beta (IL-1beta) alone does not cause apoptosis of beta-cells, whereas when combined with gamma-interferon (IFN-gamma) and tumor necrosis factor-alpha (TNF-alpha), it exerts a distinct apoptotic effect. Studies in beta-cell lines indicated that IL-1beta reduced expression of islet brain (IB)-1/JNK interacting protein (JIP)-1, a JNK scaffold protein with antiapoptotic action. We examined whether variations in IB1/JIP-1 expression in purified primary beta-cells affect their susceptibility to cytokine-induced apoptosis. Exposure to IL-1beta for 24 h decreased cellular IB1/JIP-1 content by 66 +/- 17%; this IL-1beta effect was maintained in the presence of TNF-alpha + IFN-gamma, which did not influence IB1/JIP-1 levels by themselves. Addition of IL-1beta to TNF-alpha + IFN-gamma increased apoptosis from 20 +/- 2% to 59 +/- 5%. A similar increase in TNF-alpha + IFN-gamma-induced apoptosis was produced by adenoviral expression of antisense IB1/JIP-1 and was not further enhanced by addition of IL-1beta, indicating that IL-1beta-mediated suppression of IB1/JIP-1 in beta-cells increases their susceptibility to cytokine-induced apoptosis. However, adenovirally mediated overexpression of IB1/JIP-1 also potentiated TNF-alpha + IFN-gamma-induced apoptosis, suggesting that the antiapoptotic effect of IB1/JIP-1 depends on well-defined cellular levels. We conclude that the IB1/JIP-1 level in beta-cells can control their susceptibility to apoptosis independent of JNK signaling.