Knowledge that Transforms

Suppose that each player in a game is rational, each player thinks the other players are rational, and so on. Also, suppose that rationality is taken to incorporate an admissibility requirement—that is, the avoidance of weakly dominated strategies. Which strategies can be played? We provide an epistemic framework in which to address this question. Specifically, we formulate conditions of rationality and mth-order assumption of rationality (RmAR) and rationality and common assumption of rationality (RCAR). We show that (i) RCAR is characterized by a solution concept we call a “self-admissible set”; (ii) in a “complete” type structure, RmAR is characterized by the set of strategies that survive m+1 rounds of elimination of inadmissible strategies; (iii) under certain conditions, RCAR is impossible in a complete structure.

The anti-cancer activity of calcitriol, the active metabolite of Vitamin D, in the colon is usually attributed to its anti-proliferative and pro-differentiative actions. The levels of reactive oxygen species (ROS) are high in colon carcinomas due to increased aerobic metabolism and exposure to various anti-cancer modalities. We examined whether calcitriol modulates the response of colon cancer cells to the cytotoxic action of the common mediator of ROS injury, H2O2. Pretreatment with calcitriol (100 nM, 48 h) sensitized HT-29 colon cancer cells to cell death induced by acute exposure to H2O2 or chronic exposure to the H2O2 generating system, glucose/glucose-oxidase. Although the morphological features of H2O2-induced HT-29 cell death are consistent with apoptosis, we detected no executioner caspase activation in response to cytotoxic concentrations of H2O2 and treatment with a pan-caspase inhibitor did not affect H2O2-induced cytotoxicity nor its enhancement by calcitriol. Conversely, exposure of HT-29 cells to sub-toxic concentrations of H2O2 resulted in low executioner caspase activation that was inhibited by pretreatment with calcitriol. The sensitization of colon cancer cells to ROS-induced cytotoxicity may contribute to its assumed action as a chemopreventive agent and to its therapeutic potential alone or in combination with other anti-cancer modalities.

We study a Monte Carlo algorithm for computing marginal and stationary densities of stochastic models with the Markov property, establishing global asymptotic normality and OP(n–1/2) convergence. Asymptotic normality is used to derive error bounds in terms of the distribution of the norm deviation.

Previous research has argued that debt financing affects equity-holders' investment decisions, producing substantial inefficiency. This paper shows that the size of this inefficiency depends on the degree of investment reversibility. In a dynamic model of financing and investment, the paper provides an upper bound for the inefficiency produced by debt financing. The upper bound is decreasing in the degree of investment reversibility and is zero when investment is perfectly reversible. Copyright The Econometric Society 2008.