nep-ict New Economics Papers
on Information and Communication Technologies
Issue of 2005‒12‒14
eight papers chosen by
Walter Frisch
University Vienna

  2. Capital Markets and E-fraud : Policy Note and Concept Paper for Future Study By Tom Kellermann; Valerie McNevin
  3. The Radio Spectrum : Opportunities and Challenges for the Developing World By Björn Wellenius; Isabel Neto
  4. The Co-evolution of Institutions and Technology By Desiree Desierto
  5. Effects of Advanced Traveller Information Systems on Commuters' Behaviour By Thorsten Chmura; Johannes Kaiser; Thomas Pitz; Mark Blumberg; Marco Brück
  6. Network Potentials By Subhadip Chakrabarti; Robert P. Gilles
  7. Recruiting via Internet By Christian Grund
  8. A Model of Rights By Nicholas Shunda

  1. By: Antonio Morillas (Universidad de Málaga); Bárbara Díaz (Universidad de Málaga)
    Abstract: In this work, we reflect on some questions about the measurement problem in economics and, especially, their relationship with the scientific method. Statistical sources frequently used by economists contain qualitative information obtained from verbal expressions of individuals by means of surveys, and we discuss the reasons why it would be more adequately analyzed with soft methods than with traditional ones. Some comments on the most commonly applied techniques in the analysis of these types of data with verbal answers are followed by our proposal to compute with words. In our view, an alternative use of the well known Income Evaluation Question seems especially suggestive for a computing with words approach, since it would facilitate an empirical estimation of the corresponding linguistic variable adjectives. A new treatment of the information contained in such surveys would avoid some questions incorporated in the so called Leyden approach that do not fit to the actual world.
    Keywords: Computing with words, Leyden approach, qualitative answering surveys, fuzzy logic
    JEL: C6 D5 D9
    Date: 2005–12–07
  2. By: Tom Kellermann (The World Bank); Valerie McNevin (The World Bank)
    Abstract: The technological dependency of securities exchanges on internet-based (IP) platforms has dramatically increased the industry's exposure to reputation, market, and operational risks. In addition, the convergence of several innovations in the market are adding stress to these systems. These innovations affect everything from software to system design and architecture. These include the use of XML (extensible markup language) as the industry IP language, STP or straight through processing of data, pervasive or diffuse computing and grid computing, as well as the increased use of Internet and wireless. The fraud is not new, rather, the magnitude and speed by which fraud can be committed has grown exponentially due to the convergence of once private networks on-line. It is imperative that senior management of securities markets and brokerage houses be properly informed of the negative externalities associated with e-brokerage and the possible critical points of failure that exist in today's digitized financial sector as they grow into tomorrow's exchanges. The overwhelming issue regarding e-finance is to determine the true level of understanding that senior management has about on-line platforms, including the inherent risks and the depth of the need to use it wisely. Kellermann and McNevin attempt to highlight the various risks that have been magnified by the increasing digitalization of processes within the brokerage arena and explain the need for concerted research and analysis of these as well as the profound consequences that may entail without proper planning. An effective legal, regulatory, and enforcement framework is essential for creating the right incentive structure for market participants. The legal and regulatory framework should focus on the improvement of internal monitoring of risks and vulnerabilities, greater information sharing about these risks and vulnerabilities, education and training on the care and use of these technologies, and better reporting of risks and responses. Public/private partnerships and collaborations also are needed to create an electronic commerce (e-commerce) environment that is safe and sound.
    Keywords: Domestic finance
    Date: 2005–05–01
  3. By: Björn Wellenius (; Isabel Neto (The World Bank)
    Abstract: The radio spectrum is a major component of the telecommunications infrastructure that underpins the information society. Spectrum management, however, has not kept up with major changes in technology, business practice, and economic policy during the past two decades. Traditional spectrum management practice is predicated on the spectrum being a limited resource that must be apportioned among uses and users by government administration. For many years this model worked well, but more recently the spectrum has come under pressure from rapid demand growth for wireless services and changing patterns of use. This has led to growing technical and economic inefficiencies, as well as obstacles to technological innovation. Two alternative approaches are being tried, one driven by the market (spectrum property rights) and another driven by technology innovation (commons). Practical solutions are evolving that combine some features of both. Wholesale replacement of current practice is unlikely, but the balance between administration, property rights, and commons is clearly shifting. Although the debate on spectrum management reform is mainly taking place in high-income countries, it is deeply relevant to developing countries as well.
    Keywords: Infrastructure, Industry, Private sector development, Governance, Public sector management
    Date: 2005–10–01
  4. By: Desiree Desierto
    Abstract: We propose a model of growth driven by the co-evolution of institutions and technology. To be consistent with Douglass North (1990, 1991, 1994), institutions are defined as a type of collective knowledge about a specific environment that can prescribe how to adapt general technology before the latter can be actually used. Institutions, then, are treated as a factor in the innovation process, and as such can be purposely accumulated. The simultaneous accumulation of institutions and technology are modeled as an evolutionary game whereby boundedly-rational .rms choose how much to allocate to ‘institutional spending’ vis-a-vis research expenditures, in anticipation of changes in monopoly pro.ts from technological innovation. Using Taylor and Jonker’s (1978) Replicator Dynamics to describe the evolution of such strategies, we are able to show how this transition process converges to the steady state model of Romer (1990).
    Keywords: endogenous growth, institutions, technological change
    JEL: O30 O33 O49 Z13
    Date: 2005–12
  5. By: Thorsten Chmura (Laboratory for Experimental Economics, University of Bonn, Germany); Johannes Kaiser (Laboratory for Experimental Economics, University of Bonn, Germany); Thomas Pitz (Laboratory for Experimental Economics, University of Bonn, Germany); Mark Blumberg (University of Bonn); Marco Brück (University of Bonn)
    Abstract: A genetic algorithm approach is used to study the behaviour of agents in a simulation of a daily route choice. There are two roads to choose and we show that there is a welfare enhancing effect of an Advanced Traveller Information System (ATIS) in comparison to the standard case without an ATIS. In the first case it is remarkable that not all agents follow the recommendation of the ATIS and the equilibrium distribution is only approximately attained.
    Keywords: traffic, computational economics, genetic algorithm, action trees, multi agents systems, simulation, traveller information system
    JEL: C45 C61 D83 L92
    Date: 2005–12–02
  6. By: Subhadip Chakrabarti; Robert P. Gilles
    Abstract: A network payoff function assigns a utility to all participants in a (social) network. In this paper we discuss properties of such network payoff functions that guarantee the existence of certain types of pairwise stable networks and the convergence of certain network formation processes. In particular we investigate network payoff functions that admit an exact network potential or an ordinal network potential. We relate these network potentials to exact and ordinal potentials of a non-cooperative network formation game based on consent in link formation. Our main results extend and strengthen the current insights in the literature on game theoretic approaches to social network formation.
    Keywords: Network formation; pairwise stability; potential functions
    JEL: C72 C79 D85
    Date: 2005–10
  7. By: Christian Grund
    Abstract: The internet virtually revolutionized the possibilities of employee recruiting. First of all, this contribution undertakes a description of the market. Then, advantages and possible problems of the recruitment via internet are discussed. The empirical study analyses the issues, which persons search for and find a new job via internet and which consequences arise for these persons. The results include that rather well educated persons find jobs with long working hours via internet. Controlling for several individual and job-based characteristics no differences with regard to wages and job satisfaction are found compared to other ways of recruiting.
    Keywords: Job satisfaction; Job search; Internet; Matching; Recruiting; Wages
    JEL: M12 J64 L86
    Date: 2005–07
  8. By: Nicholas Shunda (University of Connecticut)
    Abstract: In this paper, we develop a simple model of the rights a government provides its citizenry. Rights are treated as public goods and taken as primitives in agents utility functions; each agent has preferences over the entire policy vector. We model the interaction among citi-zens and the government as a game in which an exogenous lobbying set makes contributions to the government to in uence policy formu-lation in the matter of rights. When examining contribution schedules comprising truthful Nash strategies, we find that members of the lob-bying set obtain rights closer to their most-preferred bundle, while the rights of non-lobbyers further diverge from their most-preferred bun-dle. Further, if the lobbying set comprises the entire population, the government s allocation of rights does not differ from the allocation achieved in the absence of contributions.
    Keywords: contributions, political economy, rights, voting
    JEL: D72 D73 D78 H41
    Date: 2005–10

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