Cross-country evidence on inflation and inequality suggests that they are positively correlated. I explore the hypothesis that this correlation is the outcome of a distributional conflict underlying the determination of fiscal policy.

We develop a competitive equilibrium theory of a market for votes. Before voting on a binary issue, individuals may buy and sell their votes with each other. We define the concept of Ex Ante Vote-Trading Equilibrium, identify weak sufficient conditions for existence, and construct one such...

A group of P identical managers has to make a choice between N alternatives. They benefit from reaching the decision quickly. In order to learn which is the best option, the alternatives have to be compared. A manager is able to identify the better one of two alternatives only with a certain...

We study household formation in a model where collective consumption decisions of a household depend on the strategic choices of its members. The surplus of households is determined by individual choices of levels of friendliness to each other. A strategic conflict arises from a coupling...

This paper presents theory and evidence on the determinants of the size of the informal sector. We propose a simple theoretical model in which it is positively related to income inequality, more so under weak institutions, and is negatively related to the economy's wealth. These predictions are...

In this paper we introduce the notion of stability threshold that quantifies the minimal returns to size sufficient to prevent credible secession threats by regions of the country. Severity of internal tension has been linked to degree of polarization of citizens' preferences and...

The role of citizens' intitiatives figures prominantly in contemporary debates on constitutional change. A basic question is why are initiatives necessary in a representative democracy where candidates must already compete for the right to control policy? This Paper offers one answer to this...

This Paper presents theory and evidence on the relationship between inequality and institutional quality. We exhibit a model in which the two dynamically reinforce each other and set to test this relationship with a broad array of institutional measures. We establish the double causality between...

The paper deals with aspects of national and supranational influence in the European Union. The aim of this paper is three-fold. First, it deals with the relationship between the Council and Commission by applying the standard measures of voting power of cooperative games. It then extends the...

Labour productivity in the US has recently grown more strongly than in most European countries. It is often argued that the American productivity increase is due to the widespread introduction of new information and communication technologies (ICT). But why have the same technologies not...