We examine the decomposition of the gains from trade when consumption is time consuming in a simple open economy setting. While trade remains welfare improving, the sources of trade gainfulness differ from those in conventional trade models. In particular, the conventionally defined exchange (consumption) and specialisation (production) gains vanish. There are, however, positive gains from time reallocation (away from production toward consumption) and specialisation associated with this time reallocation.

Entwickelung der Gesetze des menschlichen Verkehrs und der daraus fließenden Regeln für menschliches Handeln

Decomposing the gains from trade in the presence of time-consuming consumption

We investigate revenue-maximizing mechanisms in settings where bidders’ utility functions are characterized by convex costs. Such costs arise, for instance, in procurement auctions for energy, and when bidders borrow money at non-linear interest rates. We provide a 1 / 16e approximation guarantee for a prior-free randomized mechanism when bidders’ values are drawn from MHR distributions, and their costs are polynomial. Additionally, we propose two heuristics that allocate proportionally, using either bidders’ values or virtual values. Perhaps surprisingly, in the convex cost setting, it is preferable to allocate to multiple relatively high bidders, rather than only to bidders with the highest (virtual) value, as is optimal in the traditional quasi-linear utility setting.

On Revenue-Maximizing Mechanisms Assuming Convex Costs

ZusammenfassungDer Bereich der Nachwuchsleistungssportförderung wird bislang vor allem aus dem Blickwinkel der Trainingswissenschaft diskutiert. In diesem Beitrag erweitern wir diese Sichtweise um eine humankapitaltheoretische Perspektive, die zum Standardinstrumentarium der Volkswirtschaftslehre gehört. Wir berücksichtigen, dass das Talent und sein familiäres Umfeld ein ausgedehntes Training als inkompatibel mit guten Leistungen in Schule oder Studium ansehen könnten und dementsprechend eine negative Auswirkung auf das Lebenszeiteinkommen befürchten. Eine solche Überlegung führt zu erhöhten Drop-out-Raten und relativ kleinen Talentpools, auf die das Sportsystem zurückgreifen kann. Diesen Effekt analysieren wir anhand eines einfachen Vierquadrantenmodells. Ein zentrales Ergebnis dieser Analyse ist, dass die maximal erwartbare Leistung in einer Sportart bei Trainingszeiten erzielt wird, die unterhalb des Niveaus liegen, das aus trainingswissenschaftlicher Sicht erstrebenswert ist. Vor diesem Hintergrund diskutieren wir Strategien zur Verringerung der Drop-out-Raten und die Perspektiven deutscher Athleten im internationalen Wettbewerb.AbstractThe current perspective on identifying and developing juvenile sport talents is almost exclusively based on physical education and training sciences. In this paper, we expand this to a human capital approach, which is a standard instrument in economics. We take into account that the talent and its family may view extended hours of exercise as incompatible with good performance in school. This may lead to a negative impact on future college education and expected lifetime income. Extended hours of exercise might thus increase the drop out rates, ultimately reducing the talent pool a sport system can draw from. We analyse these effects employing a simple four quadrant model. A major finding of this analysis is that the maximum expected performance is achieved at a level of exercise hours well below the optimal level from a training science perspective. With this in mind, we discuss strategies to lower drop out rates as well as prospects for the German sport system in international competitions.

Sportliches Talent: Ein humankapitaltheoretischer Ansatz

This part of the opening address is devoted to some questions which emerge while considering objective functions as particular mathematical objects in the context of optimization models. The following items are discussed: 

1.

Decision making based on optimization models.




2.

Most important types of objective functions.




3.

Development of thought.




4.

Distinction between numerical and objective functions.




5.

Surmounting the particularities of objective functions.




6.

Mathematical difficulties to be taken into account.




7.

Normative and interactive approaches to constructing objective functions.




8.

Further perspectives.

Methodological Remarks on Objective Functions

Standard static, general equilibrium models (of closed or open economies) implicitly assume that either consumption is instantaneous or economic agents have sufficient time to consume any bundle of goods. These models neglect the fact that all consumption takes time and that each agent or household is subject to a time budget in addition to a financial budget. This paper examines the impact of incorporating a Gossenian−Beckerian consumption time constraint in highly simplified models of general equilibrium model with representative households. In the closed economy case, it is shown that some resources may be left idle in equilibrium. In the small open economy case, the gains from trade are no longer assured in the presence of a consumption time constraint. Even when trade is gainful the exchange gains may be extinguished. Further, trade may still be gainful when the world and autarkic terms of trade are identical. Finally, the existence of a world terms or trade cannot be taken for granted in such a world.

Entwickelung der Gesetze des menschlichen Verkehrs und der daraus fließenden Regeln für menschliches Handeln

Citations

Decomposing the gains from trade in the presence of time-consuming consumption

On Revenue-Maximizing Mechanisms Assuming Convex Costs

Sportliches Talent: Ein humankapitaltheoretischer Ansatz

Methodological Remarks on Objective Functions

Simple General Equilibrium Models Incorporating the Assumption that Consumption Takes Time

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