The present financial and economic crisis has revealed a systemic failure of academic economics and emphasized the need to re-think how to model economic phenomena. Lawson (2009) seems concerned that critics of standard models now will fill academic journals with contributions that make the same...

Based on a money market analysis the paper discusses possible pitfalls in acroeconomic inference related to inadequate stochastic model formulation. A number of questions related to concepts such as empirical and theoretical steady-states, speed of adjustment, feed-back and interaction effects,...

In this paper we analyze the welfare properties of the set of Drèze equilibria for economies with incomplete markets and firms. The well known fact that a Drèze equilibrium need not be constrained Pareto optimal is often attributed to a lack of coordination between firms. We show that there...

Most workers are only partially insured against unemployment. One reason is that high unemployment compensation creates a free rider problem when monitoring of job search behavior is limited; people who do not seek employment (non-workers) may nevertheless collect unemployment compensation. We...

A solution concept for cooperative games, the extended core, is introduced. This concept is always nonempty yet coincides with the core whenever it is nonempty. Moreover, a non-cooperative framework can generate the extended core. Every transferable utility game is associated with a two-player...

Measures of health status, such as e.g. the QALY (Quality Adjusted Life Years) measure, have been proposed as a tool in the economic assessment of new medical technologies, and its possible foundations in individual utility theory have been discussed in the literature. However, the problems of...

A considerable literature seems to argue the use of person trade-offs to estimate the quality-adjustment factor in Quality-Adjusted Life Years (QALY) models. A similar practise is followed by the WHO to estimate the disability weights used in calculation of Disability-Adjusted Life Years (DALY)...

How far can we go in weakening the assumptions of the general equilibrium model? Existence of equilibrium, structural stability and finiteness of equilibria of regular economies, genericity of regular economies and an index formula for the equilibria of regular economies have been known not to...

This paper applies revealed preference theory to the nonparametric statistical analysis of consumer demand. It exploits the idea that price-taking individual households in the same market face the same relative prices, in order to smooth across the demands of individuals for each common price...

Models of preferences between outcomes over continuous time are important for individual, corporate, and social decision making, e.g., medical treatment, infrastructure development, and environmental regulation. This paper presents a foundation for such models. It shows that conditions on...