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When allocating indivisible items, there are various ways to use monetary transfers for eliminating envy. Particularly, one can apply a balanced vector of transfer payments, or charge each agent a positive amount, or -- contrarily -- give…
We formulate one methodology to put a value or price on knowledge using well accepted techniques from finance. We provide justifications for these finance principles based on the limitations of the physical world we live in. We start with…
Norms have been extensively proposed as coordination mechanisms for both agent and human societies. Nevertheless, choosing the norms to regulate a society is by no means straightforward. The reasons are twofold. First, the norms to choose…
Volatility is the canonical measure of financial risk, a role largely inherited from Modern Portfolio Theory. Yet, its universality rests on restrictive efficiency assumptions that render volatility, at best, an incomplete proxy for true…
Many economic theory models incorporate finiteness assumptions that, while introduced for simplicity, play a real role in the analysis. We provide a principled framework for scaling results from such models by removing these finiteness…
During the past sixty years, a lot of effort has been made regarding the productive efficiency. Such endeavours provided an extensive bibliography on this subject, culminating in two main methods, named the Stochastic Frontier Analysis…
Many learning algorithms have invariances: when their training data is transformed in certain ways, the function they learn transforms in a predictable manner. Here we formalize this notion using concepts from the mathematical field of…
Evaluation often aims to reduce the correctness or error characteristics of a system down to a single number, but that always involves trade-offs. Another way of dealing with this is to quote two numbers, such as Recall and Precision, or…
We study reinforcement learning for controlled diffusion processes with unbounded continuous state spaces, bounded continuous actions, and polynomially growing rewards: settings that arise naturally in finance, economics, and operations…
Estimating the causal effect of a treatment or health policy with observational data can be challenging due to an imbalance of and a lack of overlap between treated and control covariate distributions. In the presence of limited overlap,…
Industry classification schemes provide a taxonomy for segmenting companies based on their business activities. They are relied upon in industry and academia as an integral component of many types of financial and economic analysis.…
Predicting invoice payment is valuable in multiple industries and supports decision-making processes in most financial workflows. However, the challenge in this realm involves dealing with complex data and the lack of data related to…
There is growing interest in the role of sentiment in economic decision-making. However, most research on the subject has focused on positive and negative valence. Conviction Narrative Theory (CNT) places Approach and Avoidance sentiment…
Nowadays, financial data analysis is becoming increasingly important in the business market. As companies collect more and more data from daily operations, they expect to extract useful knowledge from existing collected data to help make…
This study emphasizes how crucial it is to visualize machine learning models, especially for the banking industry, in order to improve interpretability and support predictions in high stakes financial settings. Visual tools enable…
In this paper, simple mathematical models from Control Theory are applied to three very important economic paradigms, namely (a) minimum wages in self-regulating markets, (b) market-versus-true values and currency rates, and (c) government…
We study hedging and pricing of unattainable contingent claims in a non-Markovian regime-switching financial model. Our financial market consists of a bank account and a risky asset whose dynamics are driven by a Brownian motion and a…
Organizations use cash management models to control balances to both avoid overdrafts and obtain a profit from short-term investments. Most management models are based on control bounds which are derived from the assumption of a particular…
In many recommender systems and search problems, presenting a well balanced set of results can be an important goal in addition to serving highly relevant content. For example, in a movie recommendation system, it may be helpful to achieve…
We develop a unified valuation theory that incorporates credit risk (defaults), collateralization and funding costs, by expanding the replication approach to a generality that has not yet been studied previously and reaching valuation when…