Individual Decision-Making and Inflation Persistence

The traditional task of a central bank is to preserve price stability and, in doing so, not to impair the real economy more than necessary. To meet this challenge, it is of great relevance whether inflation is only driven by inflation expectations and the current output gap or whether it is, in addition, influenced by past inflation. In the former case, as described by the New Keynesian Phillips curve, the central bank can immediately and simultaneously achieve price stability and equilibrium output, the so-called ‘divine coincidence’ (Blanchard and Galí 2007). In the latter case, the achievement of price stability is costly in terms of output and will be pursued over several periods. Similarly, it is important to distinguish this latter case, which describes ‘intrinsic’ inflation persistence, from that of ‘extrinsic’ inflation persistence, where the sluggishness of inflation is not a ‘structural’ feature of the economy but merely ‘inherited’ from the sluggishness of the other driving forces, inflation expectations and output. ‘Extrinsic’ inflation persistence is usually considered to be the less challenging case, as policy-makers are supposed to fight against the persistence in the driving forces, especially to reduce the stickiness of inflation expectations by a credible monetary policy, in order to reestablish the ‘divine coincidence’. The scope of this dissertation is to contribute to the vast literature and ongoing discussion on inflation persistence: Chapter 1 describes the policy consequences of inflation persistence and summarizes the empirical and theoretical literature. Chapter 2 compares two models of staggered price setting, one with a fixed two-period duration and the other with a stochastic duration of prices. I show that in an economy with a timeless optimizing central bank the model with the two-period alternating price-setting (for most parameter values) leads to more persistent inflation than the model with stochastic price duration. This result amends earlier work by Kiley (2002) who found that the model with stochastic price duration generates more persistent inflation in response to an exogenous monetary shock. Chapter 3 extends the two-period alternating price-setting model to the case of 3- and 4-period price durations. This results in a more complex Phillips curve with a negative impact of past inflation on current inflation. As simulations show, this multi-period Phillips curve generates a too low degree of autocorrelation and too early turnings points of inflation and is outperformed by a simple Hybrid Phillips curve. Chapter 4 starts from the critique of Driscoll and Holden (2003) on the relative real-wage model of Fuhrer and Moore (1995). While taking the critique seriously that Fuhrer and Moore’s model will collapse to a much simpler one without intrinsic inflation persistence if one takes their arguments literally, I extend the model by a term for inequality aversion. This model extension is not only in line with experimental evidence but results in a Hybrid Phillips curve with inflation persistence that is observably equivalent to that presented by Fuhrer and Moore (1995). In chapter 5, I present a model that especially allows to study the relationship between fairness attitudes and time preference (impatience). In the model, two individuals take decisions in two subsequent periods. In period 1, both individuals are endowed with resources and are able to donate a share of their resources to the other individual. In period 2, the two individuals might join in a common production after having bargained on the split of its output. The size of the production output depends on the relative share of resources at the end of period 1 as the human capital of the individuals, which is built by means of their resources, cannot fully be substituted one against each other. Therefore, it might be rational for a well-endowed individual in period 1 to act in a seemingly ‘fair’ manner and to donate own resources to its poorer counterpart. This decision also depends on the individuals’ impatience which is induced by the small but positive probability that production is not possible in period 2. As a general result, the individuals in the model economy are more likely to behave in a ‘fair’ manner, i.e., to donate resources to the other individual, the lower their own impatience and the higher the productivity of the other individual. As the (seemingly) ‘fair’ behavior is modelled as an endogenous outcome and as it is related to the aspect of time preference, the presented framework might help to further integrate behavioral economics and macroeconomics.

AFL-1: A Programming Language for Massively Concurrent Computers

Computational models are arising is which programs are constructed by specifying large networks of very simple computational devices. Although such models can potentially make use of a massive amount of concurrency, their usefulness as a programming model for the design of complex systems will ultimately be decided by the ease in which such networks can be programmed (constructed). This thesis outlines a language for specifying computational networks. The language (AFL-1) consists of a set of primitives, ad a mechanism to group these elements into higher level structures. An implementation of this language runs on the Thinking Machines Corporation, Connection machine. Two significant examples were programmed in the language, an expert system (CIS), and a planning system (AFPLAN). These systems are explained and analyzed in terms of how they compare with similar systems written in conventional languages.

Concurrent Aggregates (CA): An Object-Oriented Language for Fine-Grained Message-Passing Machines

Fine-grained parallel machines have the potential for very high speed computation. To program massively-concurrent MIMD machines, programmers need tools for managing complexity. These tools should not restrict program concurrency. Concurrent Aggregates (CA) provides multiple-access data abstraction tools, Aggregates, which can be used to implement abstractions with virtually unlimited potential for concurrency. Such tools allow programmers to modularize programs without reducing concurrency. I describe the design, motivation, implementation and evaluation of Concurrent Aggregates. CA has been used to construct a number of application programs. Multi-access data abstractions are found to be useful in constructing highly concurrent programs.

Generative Temporal Planning with Complex Processes

Autonomous vehicles are increasingly being used in mission-critical applications, and robust methods are needed for controlling these inherently unreliable and complex systems. This thesis advocates the use of model-based programming, which allows mission designers to program autonomous missions at the level of a coach or wing commander. To support such a system, this thesis presents the Spock generative planner. To generate plans, Spock must be able to piece together vehicle commands and team tactics that have a complex behavior represented by concurrent processes. This is in contrast to traditional planners, whose operators represent simple atomic or durative actions. Spock represents operators using the RMPL language, which describes behaviors using parallel and sequential compositions of state and activity episodes. RMPL is useful for controlling mobile autonomous missions because it allows mission designers to quickly encode expressive activity models using object-oriented design methods and an intuitive set of activity combinators. Spock also is significant in that it uniformly represents operators and plan-space processes in terms of Temporal Plan Networks, which support temporal flexibility for robust plan execution. Finally, Spock is implemented as a forward progression optimal planner that walks monotonically forward through plan processes, closing any open conditions and resolving any conflicts. This thesis describes the Spock algorithm in detail, along with example problems and test results.

Building Grounded Abstractions for Artificial Intelligence Programming

Most Artificial Intelligence (AI) work can be characterized as either ``high-level'' (e.g., logical, symbolic) or ``low-level'' (e.g., connectionist networks, behavior-based robotics). Each approach suffers from particular drawbacks. High-level AI uses abstractions that often have no relation to the way real, biological brains work. Low-level AI, on the other hand, tends to lack the powerful abstractions that are needed to express complex structures and relationships. I have tried to combine the best features of both approaches, by building a set of programming abstractions defined in terms of simple, biologically plausible components. At the ``ground level'', I define a primitive, perceptron-like computational unit. I then show how more abstract computational units may be implemented in terms of the primitive units, and show the utility of the abstract units in sample networks. The new units make it possible to build networks using concepts such as long-term memories, short-term memories, and frames. As a demonstration of these abstractions, I have implemented a simulator for ``creatures'' controlled by a network of abstract units. The creatures exist in a simple 2D world, and exhibit behaviors such as catching mobile prey and sorting colored blocks into matching boxes. This program demonstrates that it is possible to build systems that can interact effectively with a dynamic physical environment, yet use symbolic representations to control aspects of their behavior.

On the Convergence of Stochastic Iterative Dynamic Programming Algorithms

Recent developments in the area of reinforcement learning have yielded a number of new algorithms for the prediction and control of Markovian environments. These algorithms, including the TD(lambda) algorithm of Sutton (1988) and the Q-learning algorithm of Watkins (1989), can be motivated heuristically as approximations to dynamic programming (DP). In this paper we provide a rigorous proof of convergence of these DP-based learning algorithms by relating them to the powerful techniques of stochastic approximation theory via a new convergence theorem. The theorem establishes a general class of convergent algorithms to which both TD(lambda) and Q-learning belong.

Evaluation of sets of oriented and non-oriented receptive fields as local descriptors

Local descriptors are increasingly used for the task of object recognition because of their perceived robustness with respect to occlusions and to global geometrical deformations. We propose a performance criterion for a local descriptor based on the tradeoff between selectivity and invariance. In this paper, we evaluate several local descriptors with respect to selectivity and invariance. The descriptors that we evaluated are Gaussian derivatives up to the third order, gray image patches, and Laplacian-based descriptors with either three scales or one scale filters. We compare selectivity and invariance to several affine changes such as rotation, scale, brightness, and viewpoint. Comparisons have been made keeping the dimensionality of the descriptors roughly constant. The overall results indicate a good performance by the descriptor based on a set of oriented Gaussian filters. It is interesting that oriented receptive fields similar to the Gaussian derivatives as well as receptive fields similar to the Laplacian are found in primate visual cortex.

New Architectural Models for Visibly Controllable Computing: The Relevance of Dynamic Object Oriented Architectures and Plan Based Computing Models

Traditionally, we've focussed on the question of how to make a system easy to code the first time, or perhaps on how to ease the system's continued evolution. But if we look at life cycle costs, then we must conclude that the important question is how to make a system easy to operate. To do this we need to make it easy for the operators to see what's going on and to then manipulate the system so that it does what it is supposed to. This is a radically different criterion for success. What makes a computer system visible and controllable? This is a difficult question, but it's clear that today's modern operating systems with nearly 50 million source lines of code are neither. Strikingly, the MIT Lisp Machine and its commercial successors provided almost the same functionality as today's mainstream sytsems, but with only 1 Million lines of code. This paper is a retrospective examination of the features of the Lisp Machine hardware and software system. Our key claim is that by building the Object Abstraction into the lowest tiers of the system, great synergy and clarity were obtained. It is our hope that this is a lesson that can impact tomorrow's designs. We also speculate on how the spirit of the Lisp Machine could be extended to include a comprehensive access control model and how new layers of abstraction could further enrich this model.

Memory Usage Inference for Object-Oriented Programs

We present a type-based approach to statically derive symbolic closed-form formulae that characterize the bounds of heap memory usages of programs written in object-oriented languages. Given a program with size and alias annotations, our inference system will compute the amount of memory required by the methods to execute successfully as well as the amount of memory released when methods return. The obtained analysis results are useful for networked devices with limited computational resources as well as embedded software.

Reasoning about Temporal Context using Ontology and Abductive Constraint Logic Programming

The underlying assumptions for interpreting the meaning of data often change over time, which further complicates the problem of semantic heterogeneities among autonomous data sources. As an extension to the COntext INterchange (COIN) framework, this paper introduces the notion of temporal context as a formalization of the problem. We represent temporal context as a multi-valued method in F-Logic; however, only one value is valid at any point in time, the determination of which is constrained by temporal relations. This representation is then mapped to an abductive constraint logic programming framework with temporal relations being treated as constraints. A mediation engine that implements the framework automatically detects and reconciles semantic differences at different times. We articulate that this extended COIN framework is suitable for reasoning on the Semantic Web.

Reasoning about Temporal Context using Ontology and Abductive Constraint Logic Programming

The underlying assumptions for interpreting the meaning of data often change over time, which further complicates the problem of semantic heterogeneities among autonomous data sources. As an extension to the COntext INterchange (COIN) framework, this paper introduces the notion of temporal context as a formalization of the problem. We represent temporal context as a multi-valued method in F-Logic; however, only one value is valid at any point in time, the determination of which is constrained by temporal relations. This representation is then mapped to an abductive constraint logic programming framework with temporal relations being treated as constraints. A mediation engine that implements the framework automatically detects and reconciles semantic differences at different times. We articulate that this extended COIN framework is suitable for reasoning on the Semantic Web.

Reasoning about Temporal Context using Ontology and Abductive Constraint Logic Programming

The underlying assumptions for interpreting the meaning of data often change over time, which further complicates the problem of semantic heterogeneities among autonomous data sources. As an extension to the COntext INterchange (COIN) framework, this paper introduces the notion of temporal context as a formalization of the problem. We represent temporal context as a multi-valued method in F-Logic; however, only one value is valid at any point in time, the determination of which is constrained by temporal relations. This representation is then mapped to an abductive constraint logic programming framework with temporal relations being treated as constraints. A mediation engine that implements the framework automatically detects and reconciles semantic differences at different times. We articulate that this extended COIN framework is suitable for reasoning on the Semantic Web.

Reasoning about Temporal Context using Ontology and Abductive Constraint Logic Programming

The underlying assumptions for interpreting the meaning of data often change over time, which further complicates the problem of semantic heterogeneities among autonomous data sources. As an extension to the COntext INterchange (COIN) framework, this paper introduces the notion of temporal context as a formalization of the problem. We represent temporal context as a multi-valued method in F-Logic; however, only one value is valid at any point in time, the determination of which is constrained by temporal relations. This representation is then mapped to an abductive constraint logic programming framework with temporal relations being treated as constraints. A mediation engine that implements the framework automatically detects and reconciles semantic differences at different times. We articulate that this extended COIN framework is suitable for reasoning on the Semantic Web.

Preconditioning and iterative solution of symmetric indefinite linear systems arising from interior point methods for linear programming

We study the preconditioning of symmetric indefinite linear systems of equations that arise in interior point solution of linear optimization problems. The preconditioning method that we study exploits the block structure of the augmented matrix to design a similar block structure preconditioner to improve the spectral properties of the resulting preconditioned matrix so as to improve the convergence rate of the iterative solution of the system. We also propose a two-phase algorithm that takes advantage of the spectral properties of the transformed matrix to solve for the Newton directions in the interior-point method. Numerical experiments have been performed on some LP test problems in the NETLIB suite to demonstrate the potential of the preconditioning method discussed.

Investigation of aspect ratio of hole drilling from micro to nanoscale via focused ion beam fine milling

Holes with different sizes from microscale to nanoscale were directly fabricated by focused ion beam (FIB) milling in this paper. Maximum aspect ratio of the fabricated holes can be 5:1 for the hole with large size with pure FIB milling, 10:1 for gas assistant etching, and 1:1 for the hole with size below 100 nm. A phenomenon of volume swell at the boundary of the hole was observed. The reason maybe due to the dose dependence of the effective sputter yield in low intensity Gaussian beam tail regions and redeposition. Different materials were used to investigate variation of the aspect ratio. The results show that for some special material, such as Ni-Be, the corresponding aspect ratio can reach 13.8:1 with Cl₂ assistant etching, but only 0.09:1 for Si(100) with single scan of the FIB.