Cross-border banking needs cross-border recapitalisation mechanisms. Each mechanism, however, suffers from the financial trilemma, which is that cross-border banking, national financial autonomy and financial stability are incompatible. In this paper, we study the efficiency of different...

Experimental studies have shown that sanctions effectively deter free riding within groups. However, the over-use of costly punishment may actually harm overall welfare. A main reason for over-punishment is that free-riders generate negative emotions that likely favor excessive punishments. In...

This paper demonstrates the effects of ethnic and religious diversity on the quality of public spaces. Its identification strategy relies on the exogeneity of public housing allocations in France, and thereby eliminates the bias from endogenous sorting. The paper uses micro evidence of social...

This Paper analyses an overlapping generation model of public good provision under repeated voting. The public good is financed through age-dependent taxation that distorts human capital investment. Taxes redistribute income both across different skill groups and across generations. We contrast...

We investigate the emergence and enforcement of contribution norms to public goods in homogeneous and heterogeneous groups. With survey data we demonstrate that uninvolved individuals hold well defined yet conflicting normative views of fair contribution rules related to efficiency, equality,...

The burgeoning literature on the use of sanctions to support the provision of public goods has largely neglected the use of formal or centralized sanctions. We let subjects playing a linear public goods game vote on the parameters of a formal sanction scheme capable of either resolving or...

We analyze the effect of a large group on an impure public goods model with lotteries. We show that as populations get large, and with selfish preferences, the level of contributions converges to the one given by voluntary contributions. With altruistic preferences (of the warm glow type), the...

The purpose of this paper is to investigate the mutual compatibility of voluntary provision of public good and strategic behavior of consumers in the market for private goods. We study the existence of equilibrium private provision of a public good within general strategic equilibrium framework...

This note is an answer to a previous model on conformity in public goods contributions developed by Carpenter (2004), where a population evolution is allowed according to the standard replicator dynamic (Taylor and Jonker, 1978; Maynard Smith, 1982). To confirm his theoretical prediction, Carpenter...

In an economy with voluntarily provided public goods and private product varieties, and a general class of CES preferences, it is shown that aggregate public good contribution follows an inverted-U pattern with respect to group size when private and public goods are substitutable in preferences....