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Gambling for Resurrection in Iceland : The Rise and Fall of the Banks
(Social Science Research Network, 2013-09-23) Baldursson, Friðrik Már; Portes, Richard; Department of Business and Economics
We examine the evolution of the Icelandic banking sector in its macroeconomic environment. The story culminates in the crisis of October 2008, when all three major banks in Iceland collapsed in three successive days. The country is still struggling to cope with the consequences. The paper follows on our report of autumn 2007. The macroeconomic boom that peaked in 2007 led to severe imbalances. The banks had expanded at a rapid pace and reported healthy profits, capital ratios and liquidity until their collapse. An official report (SIC, 2010) has, however, exposed severe weaknesses in the banks’ assets and governance. The Icelandic Financial Services Authority (FSA) clearly knew little of the magnitude of large, single exposures and lending to the banks’ owners, although they strongly maintained otherwise in autumn 2007. Neither the FSA nor the Central Bank of Iceland (CBI) saw the systemic risks created by lending to owners and related parties, which increased greatly from September 2007. With the financial turmoil that began in August 2007, the banks’ access to capital markets was curtailed. They then gambled on resurrection, expanding their balance sheets and refinancing the investments of their owners and other big borrowers, while they should have been deleveraging and securing their liquidity positions in foreign currency. The banks also prevented their share prices from collapsing by purchases of their own shares in the stock market, offloading accumulated shares in private deals, usually financed by themselves. All this went on apparently unnoticed by regulators. The Icelandic banks did not buy toxic securities – but together, they administered their own potent mix of systemic poison. Only a month before the collapse of October 2008 the banks all reported strong liquidity positions. These reports were misleading, but we also show how financing unravelled over the course of a few days, and collapse became inevitable. The rapid evaporation of liquidity and market funding is one of the key lessons of the story. Whereas the United States, the United Kingdom and other countries had the resources to bail out their irresponsible and illiquid banks, Iceland did not, and it received little foreign help or even sympathy. Iceland’s response to the crisis, with its heterodox policies and aid from the IMF, has been relatively successful.
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On the rational utilization of the Icelandic cod stock
(1996-08) Baldursson, Friorik M.; Daníelsson, Ásgeir; Stefánsson, Gunnar; Department of Business and Economics
The Icelandic cod stock is analysed with respect to the probable effects of different harvesting strategies on yield, spawning stock biomass, and economic benefits. Simulations are used to investigate the probability of stock recovery and collapse. Potential yield and economic benefits/costs are also investigated, using stochastic and deterministic models. In stochastic simulations, attention is paid to the apparent stock recruitment relationship, the highly variable weight-at-age and maturity-at-age in Icelandic water along with the inevitable inaccuracies in current and future assessments. Regardless of method, substantial reduction in catches from recent (1993) levels is seen to be necessary in order to rebuild the stock. In the deterministic model, profit maximization mandates closure of the fishery until stock is rehabilitated. Using the stochastic model, it is predicted that recent catch level lead to eventual extinction of the stock with high probability. A management procedure is formulated and its application to the model is shown to lead to stabilization of the stock around an economically and biologically acceptable level.
Verk
Lower bounds for on-line graph coloring
(Association for Computing Machinery, 1992-09-01) Halldórsson, Magnús M.; Szegedy, Márió; Department of Computer Science
An algorithm for vertex-coloring graphs is said to be online if each vertex is irrevocably assigned a color before any later vertices are considered. We show that such algorithms are inherently ineffective. The performance ratio of any such algorithm can be no better than Ω(n/log2n), even for randomized algorithms against oblivious adversary. We also show that various means of relaxing the constraints of the on-line model do not reduce these lower bounds. The features include presenting the input in blocks of log2 n vertices, recoloring any fraction of the vertices, presorting vertices according to degree, and disclosing the adversary's previous coloring.
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Sibilla : A Tool for Reasoning about Collective Systems
(Springer Science and Business Media Deutschland GmbH, 2022) Del Giudice, Nicola; Matteucci, Lorenzo; Quadrini, Michela; Rehman, Aniqa; Loreti, Michele; ter Beek, Maurice H.; Sirjani, Marjan; Department of Computer Science
Sibilla is a Java framework designed to support the analysis of Collective Adaptive Systems. These are systems composed by a large set of interactive agents that cooperate and compete to reach local and global goals. Sibilla is thought of container where different tools supporting specification and analysis of concurrent and distributed large scaled systems can be integrated. In this paper, a brief overview of Sibilla features is provided together with a simple example showing some of the tool’s practical capabilities.
Verk
Impossible ecologies: Interaction networks and stability of coexistence in ecological communities
(2023) Meng, Y.; Horvát, S.; Modes, C.D.; Haas, P.A.; Department of Computer Science

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