Adverse Selection, Credit, and Efficiency: the Case of the Missing Market

We analyze a standard environment of adverse selection in credit markets. In our envi- ronment, entrepreneurs who are privately informed about the quality of their projects need to borrow from banks. As is generally the case in economies with adverse selection, the competitive equilibrium of our economy is shown to be ine¢ cient. Under adverse selection, the choices made by one type of agents limit what can be o¤ered to other types in an incentive-compatible manner. This gives rise to an externality, which cannot be internalized in a competitive equilibrium. We show that, in this type of environment, the ine¢ ciency associated to adverse selection is the consequence of one implicit assumption: entrepreneurs can only borrow from banks. If an additional market is added (say, a .security market.), in which entrepreneurs can obtain funds beyond those o¤ered by banks, we show that the e¢ cient allocation is an equilibrium of the economy. In such an equilibrium, all entrepreneurs borrow at a pooling rate in the security market. When they apply to bank loans, though, only entrepreneurs with good projects pledge these additional funds as collateral. This equilibrium thus simultaneously entails cross- subsidization and separation between di¤erent types of entrepreneurs.

Adverse selection, credit, and efficiency: the case of the missing market

We analyze a standard environment of adverse selection in credit markets. In our environment, entrepreneurs who are privately informed about the quality of their projects need to borrow in order to invest. Conventional wisdom says that, in this class of economies, the competitive equilibrium is typically inefficient. We show that this conventional wisdom rests on one implicit assumption: entrepreneurs can only access monitored lending. If a new set of markets is added to provide entrepreneurs with additional funds, efficiency can be attained in equilibrium. An important characteristic of these additional markets is that lending in them must be unmonitored, in the sense that it does not condition total borrowing or investment by entrepreneurs. This makes it possible to attain efficiency by pooling all entrepreneurs in the new markets while separating them in the markets for monitored loans.

High genetic variability and low local diversity in a population of arbuscular mycorrhizal fungi.

Arbuscular mycorrhizal fungi (AMF) are ecologically important root symbionts of most terrestrial plants. Ecological studies of AMF have concentrated on differences between species; largely assuming little variability within AMF species. Although AMF are clonal, they have evolved to contain a surprisingly high within-species genetic variability, and genetically different nuclei can coexist within individual spores. These traits could potentially lead to within-population genetic variation, causing differences in physiology and symbiotic function in AMF populations, a consequence that has been largely neglected. We found highly significant genetic and phenotypic variation among isolates of a population of Glomus intraradices but relatively low total observed genetic diversity. Because we maintained the isolated population in a constant environment, phenotypic variation can be considered as variation in quantitative genetic traits. In view of the large genetic differences among isolates by randomly sampling two individual spores, <50% of the total observed population genetic diversity is represented. Adding an isolate from a distant population did not increase total observed genetic diversity. Genetic variation exceeded variation in quantitative genetic traits, indicating that selection acted on the population to retain similar traits, which might be because of the multigenomic nature of AMF, where considerable genetic redundancy could buffer the effects of changes in the genetic content of phenotypic traits. These results have direct implications for ecological research and for studying AMF genes, improving commercial AMF inoculum, and understanding evolutionary mechanisms in multigenomic organisms.

Scalable inference of heterogeneous reaction kinetics from pooled single-cell recordings.

Mathematical methods combined with measurements of single-cell dynamics provide a means to reconstruct intracellular processes that are only partly or indirectly accessible experimentally. To obtain reliable reconstructions, the pooling of measurements from several cells of a clonal population is mandatory. However, cell-to-cell variability originating from diverse sources poses computational challenges for such process reconstruction. We introduce a scalable Bayesian inference framework that properly accounts for population heterogeneity. The method allows inference of inaccessible molecular states and kinetic parameters; computation of Bayes factors for model selection; and dissection of intrinsic, extrinsic and technical noise. We show how additional single-cell readouts such as morphological features can be included in the analysis. We use the method to reconstruct the expression dynamics of a gene under an inducible promoter in yeast from time-lapse microscopy data.

Optimal Contracts, Adverse Selection, and Social Preferences: An Experiment

It has long been standard in agency theory to search for incentive-compatible mechanisms on the assumption that people care only about their own material wealth. However, this assumption is clearly refuted by numerous experiments, and we feel that it may be useful to consider nonpecuniary utility in mechanism design and contract theory. Accordingly, we devise an experiment to explore optimal contracts in an adverse-selection context. A principal proposes one of three contract menus, each of which offers a choice of two incentive-compatible contracts, to two agents whose types are unknown to the principal. The agents know the set of possible menus, and choose to either accept one of the two contracts offered in the proposed menu or to reject the menu altogether; a rejection by either agent leads to lower (and equal) reservation payoffs for all parties. While all three possible menus favor the principal, they do so to varying degrees. We observe numerous rejections of the more lopsided menus, and approach an equilibrium where one of the more equitable contract menus (which one depends on the reservation payoffs) is proposed and agents accept a contract, selecting actions according to their types. Behavior is largely consistent with all recent models of social preferences, strongly suggesting there is value in considering nonpecuniary utility in agency theory.

Monoclonal antibodies to carcinoembryonic antigen: ionic strength as a factor in the selection of antibodies for immunoscintigraphy.

As part of an ongoing effort to improve the technique of immunoscintigraphy for the detection of human carcinomas with radiolabeled monoclonal antibodies (MABs) to carcinoembryonic antigen (CEA), we have developed a series of MABs to CEA and have studied the effects of low- and physiological molarity buffers on their CEA binding and affinity, as well as their cross-reactivity with granulocyte glycoprotein(s). These in vitro results in different buffer systems were then correlated with the use of these MABs to CEA in the detection of human colon carcinoma grafts in nude mice. Our results show that the binding of CEA by some MABs is influenced by ionic strength and that this may be an important factor in their successful use for the immunolocalization of carcinomas in vivo.

Neuronal responses in mouse barrel cortex:Comparison of two signal discriminators

Barrels are discrete cytoarchitectonic neurons cluster located in the layer IV of the somatosensory¦cortex in mice brain. Each barrel is related to a specific whisker located on the mouse snout. The¦whisker-to-barrel pathway is a part of the somatosensory system that is intensively used to explore¦sensory activation induced plasticity in the cerebral cortex.¦Different recording methods exist to explore the cortical response induced by whisker deflection in¦the cortex of anesthetized mice. In this work, we used a method called the Single-Unit Analysis by¦which we recorded the extracellular electric signals of a single barrel neuron using a microelectrode.¦After recording the signal was processed by discriminators to isolate specific neuronal shape (action¦potentials).¦The objective of this thesis was to familiarize with the barrel cortex recording during whisker¦deflection and its theoretical background and to compare two different ways of discriminating and¦sorting cortical signal, the Waveform Window Discriminator (WWD) or the Spike Shape Discriminator (SSD).¦WWD is an electric module allowing the selection of specific electric signal shape. A trigger and a¦window potential level are set manually. During measurements, every time the electric signal passes¦through the two levels a dot is generated on time line. It was the method used in previous¦extracellular recording study in the Département de Biologie Cellulaire et de Morphologie (DBCM) in¦Lausanne.¦SSD is a function provided by the signal analysis software Spike2 (Cambridge Electronic Design). The¦neuronal signal is discriminated by a complex algorithm allowing the creation of specific templates.¦Each of these templates is supposed to correspond to a cell response profile. The templates are saved¦as a number of points (62 in this study) and are set for each new cortical location. During¦measurements, every time the cortical recorded signal corresponds to a defined number of templates¦points (60% in this study) a dot is generated on time line. The advantage of the SSD is that multiple¦templates can be used during a single stimulation, allowing a simultaneous recording of multiple¦signals.¦It exists different ways to represent data after discrimination and sorting. The most commonly used¦in the Single-Unit Analysis of the barrel cortex are the representation of the time between stimulation¦and the first cell response (the latency), the representation of the Response Magnitude (RM) after¦whisker deflection corrected for spontaneous activity and the representation of the time distribution¦of neuronal spikes on time axis after whisker stimulation (Peri-Stimulus Time Histogram, PSTH).¦The results show that the RMs and the latencies in layer IV were significantly different between the¦WWD and the SSD discriminated signal. The temporal distribution of the latencies shows that the¦different values were included between 6 and 60ms with no peak value for SSD while the WWD¦data were all gathered around a peak of 11ms (corresponding to previous studies). The scattered¦distribution of the latencies recorded with the SSD did not correspond to a cell response.¦The SSD appears to be a powerful tool for signal sorting but we do not succeed to use it for the¦Single-Unit Analysis extracellular recordings. Further recordings with different SSD templates settings¦and larger sample size may help to show the utility of this tool in Single-Unit Analysis studies.

A Model of Collateral, Investment, and Adverse Selection

This paper characterizes the relationship between entrepreneurial wealth and aggregate investment under adverse selection. Its main finding is that such a relationship need not be monotonic. In particular, three results emerge from the analysis: (i) pooling equilibria, in which investment is independent of entrepreneurial wealth, are more likely to arise when entrepreneurial wealth is relatively low; (ii) separating equilibria, in which investment is increasing in entrepreneurial wealth, are most likely to arise when entrepreneurial wealth is relatively high and; (iii) for a given interest rate, an increase in entrepreneurial wealth may generate a discontinuous fall in investment.

Myocardial flow reserve by Rb-82 cardiac PET improves the selection of patients eligible for invasive coronary angiography

Aim: We asked whether myocardial flow reserve (MFR) by Rb-82 cardiac PET improve the selection of patients eligible for invasive coronary angiography (ICA). Material and Methods: We enrolled 26 consecutive patients with suspected or known coronary artery disease who performed dynamic Rb-82 PET/CT and (ICA) within 60 days; 4 patients who underwent revascularization or had any cardiovascular events between PET and ICA were excluded. Myocardial blood flow at rest (rMBF), at stress with adenosine (sMBF) and myocardial flow reserve (MFR=sMBF/rMBF) were estimated using the 1-compartment Lortie model (FlowQuant) for each coronary arteries territories. Stenosis severity was assessed using computer-based automated edge detection (QCA). MFR was divided in 3 groups: G1:MFR<1.5, G2:1.5≤MFR<2 and G3:2≤MFR. Stenosis severity was graded as non-significant (<50% or FFR ≥0.8), intermediate (50%≤stenosis<70%) and severe (≥70%). Correlation between MFR and percentage of stenosis were assessed using a non-parametric Spearman test. Results: In G1 (44 vessels), 17 vessels (39%) had a severe stenosis, 11 (25%) an intermediate one, and 16 (36%) no significant stenosis. In G2 (13 vessels), 2 (15%) vessels presented a severe stenosis, 7 (54%) an intermediate one, and 4 (31%) no significant stenosis. In G3 (9 vessels), 0 vessel presented a severe stenosis, 1 (11%) an intermediate one, and 8 (89%) no significant stenosis. Of note, among 11 patients with 3-vessel low MFR<1.5 (G1), 9/11 (82%) had at least one severe stenosis and 2/11 (18%) had at least one intermediate stenosis. There was a significant inverse correlation between stenosis severity and MFR among all 66 territories analyzed (rho= -0.38, p=0.002). Conclusion: Patients with MFR>2 could avoid ICA. Low MFR (G1, G2) on a vessel-based analysis seems to be a poor predictor of severe stenosis severity. Patients with 3-vessel low MFR would benefit from ICA as they are likely to present a significant stenosis in at least one vessel.

Frequent clonal loss of heterozygosity but scarcity of microsatellite instability at chromosomal breakpoint cluster regions in adult leukemias.

Microsatellites are important highly polymorphic genetic markers dispersed in the human genome. Using a panel of 22 (CA)n repeat microsatellite markers mapped to recurrent breakpoint cluster regions specifically involved in leukemia, we investigated 114 adult leukemias (25 acute lymphocytic leukemia [ALL], 32 acute myeloid leukemia [AML], 36 chronic lymphocytic leukemia [CLL], and 21 chronic myeloid leukemia [CML] in chronic phase) for somatic mutations at these loci. In each patient, DNA from fresh leukemia samples was analyzed alongside normal constitutive DNA from buccal epithelium. We detected loss of heterozygosity (LOH) in 81 of 114 patients (ALL 16/25, AML 25/32, CLL 30/36, CML 10/21). Deletions were most often seen in ALL at 11q23 and 19p13; in AML at 8q22 and 11q23; in CLL at 13q14.3, 11q13, and 11q23; and in CML at 3q26. Only six deletions were reported in 74 karyotypes analyzed, whereas in these same cases, 91 LOH events were detected by microsatellites. Of 26 leukemias with a normal karyotype, 16 nevertheless showed at least one LOH by microsatellite analysis. Replication errors were found in 10 of 114 patients (8.8%). Thus, microsatellite instability is rare in leukemia in contrast to many solid tumors. Our findings suggest that in adult leukemia, LOH may be an important genetic event in addition to typical chromosomal translocations. LOH may point to the existence of tumor suppressor genes involved in leukemogenesis to a degree that has hitherto been underestimated.

A clonal Plasmodium falciparum population in an isolated outbreak of malaria in the Republic of Cabo Verde

We present the first parasitological, molecular and longitudinal analysis of an isolated outbreak of malaria. This outbreak occurred on Santiago Island (Republic of Cabo Verde), a region where malaria is hypoendemic and controlled, and thus the population is considered non-immune. Blood samples were collected from the inhabitants over 1 month and during cross-sectional surveys in the following year. The presence and nature of the parasites was determined by PCR. Plasmodium falciparum was the only species detected. Genetic analysis revealed that the circulating parasites were genetically homogeneous, and probably clonal. Gametocytes were found throughout this period. Our data suggest that this represented a focal outbreak, resulting in the infection of at least 40% of the villagers with a clonal parasite line. Thus, P. falciparum infections can persist for at least 1 year in a substantial proportion (10%) of the hosts. Implications for malaria control and the interpretation of epidemiological data are discussed.

Genetic team composition and level of selection in the evolution of cooperation

In cooperative multiagent systems, agents interac to solve tasks. Global dynamics of multiagent teams result from local agent interactions, and are complex and difficult to predict. Evolutionary computation has proven a promising approach to the design of such teams. The majority of current studies use teams composed of agents with identical control rules ("geneti- cally homogeneous teams") and select behavior at the team level ("team-level selection"). Here we extend current approaches to include four combinations of genetic team composition and level of selection. We compare the performance of genetically homo- geneous teams evolved with individual-level selection, genetically homogeneous teams evolved with team-level selection, genetically heterogeneous teams evolved with individual-level selection, and genetically heterogeneous teams evolved with team-level selection. We use a simulated foraging task to show that the optimal combination depends on the amount of cooperation required by the task. Accordingly, we distinguish between three types of cooperative tasks and suggest guidelines for the optimal choice of genetic team composition and level of selection

A polynomial algorithm for special case of the one-machine scheduling problem with time-lags

The standard one-machine scheduling problem consists in schedulinga set of jobs in one machine which can handle only one job at atime, minimizing the maximum lateness. Each job is available forprocessing at its release date, requires a known processing timeand after finishing the processing, it is delivery after a certaintime. There also can exists precedence constraints between pairsof jobs, requiring that the first jobs must be completed beforethe second job can start. An extension of this problem consistsin assigning a time interval between the processing of the jobsassociated with the precedence constrains, known by finish-starttime-lags. In presence of this constraints, the problem is NP-hardeven if preemption is allowed. In this work, we consider a specialcase of the one-machine preemption scheduling problem with time-lags, where the time-lags have a chain form, and propose apolynomial algorithm to solve it. The algorithm consist in apolynomial number of calls of the preemption version of the LongestTail Heuristic. One of the applicability of the method is to obtainlower bounds for NP-hard one-machine and job-shop schedulingproblems. We present some computational results of thisapplication, followed by some conclusions.