We introduce a new solution concept for games in extensive formwith perfect information, valuation equilibrium, which is based on a partition of each player’s moves into similarity classes. A valuation of a player is a real-valued function on the set of her similarity classes. In this equilibrium each player’s strategy is optimal in the sense that at each of her nodes, a player chooses a move t...

This paper considers the valuation of exotic path-dependent options in Lévy models, in particular options on the supremum and the infimum of the asset price process. Using the Wiener–Hopf factorization, we derive expressions for the analytically extended characteristic function of the supremum and the infimum of a Lévy process. Combined with general results on Fourier methods for option pricing...

The aim of this paper is to present a framework to bank valuation based on two generally acceptable valuation models that are not specific to banks: the model of discounted Equity Cash Flow to Equity (ECF) and the model of discounted Residual Income (RI). As emphasized by Koller, Goedhart and Wessels (pp. 663, 2005) [1] in a bestselling book on the valuation of firms, the valuation process of a...

syntax and informal semantics This chapter presents a concise definition of the abstract syntax and informal semantics of the elements of the χ formalism. The syntax definition is incomplete in the sense that the syntax of predicates, expressions, etc. is defined at a high level of abstraction. This is done because different implementations of χ , such as tools for simulation, verification, or ...

Many personality theories link specific traits to the sensitivities of the neural systems that control approach and avoidance. But there is no consensus on the nature of these systems. Here we combine recent advances in economics and neuroscience to provide a more solid foundation for a neuroscience of approach/avoidance personality. We propose a two-stage integration of valuation (loss/gain) s...

We have developed a social optimization model that integrates wastewater treatment cost function and ecosystem damage cost function. The social optimal abatement level of water pollution is determined by finding the tradeoff between pollution control cost and ecosystem damage. The model is applied to data from the Lake Taihu region in China to demonstrate this tradeoff. A wastewater treatment c...

wetlands as a situ for the growth of native plants, as a habitat for certain species of fish and aquatic birds, and because of their potential economic, cultural and recreational services, are valuable heritage so their protection and conservation is very essential. mostly due to the absence of wetlands services’ valuation, lack of special regulations, and lack of guarantee for these properties...

A robust prediction of auction theory is that reserve prices will be used in auctions. The optimal selling mechanism for the owner of a unique, indivisible item is to sell to the bidder with the highest valuation unless this valuation is below a cut-off level; and this cut-off valuation is strictly above the seller’s own valuation. Thus the monopolist imposes a distortion: with positive probabi...