It is well known that, in OLG economies with life-cycle saving and exogenous growth, competitive equilibria will in general fail to achieve optimality and may even be dynamically inefficient. This is a consequence of individuals accumulating amounts of physical capital that differ from the level...

The burden sharing of pollution abatement costs raises the issue of how to share the costs between entities (country, region or industry) and how the pollution permits should be distributed between the parties involved. This paper explores this issue in the framework of a dynamic endogenous...

In this paper we explore the consequences for optimality of a social planner adopting two different welfare criteria. The framework of analysis is an OLG model with physical and human capital. We first show that, when the SWF is a discounted sum of individual utilities defined over consumption...

This paper attemps to identify, in a framework deliberately stripped of unnecessary technical- ities, some of the basic reasons why adaptive learning may or may not lead to stability and convergence to self-fulfilling expectations in large socioeconomic systems where no agent, or collection of...

This paper attempts to identify, in a framework deliberately stripped of unnecessary technicalities, some of the basic reasons why adaptative learning may or may not lead to stability and convergence to self-fulfilling expectations in large socioeconomic systems where no agent, or collection of...

In a game with positive externalities, such as e.g. the standard environmental externality game used in the analysis of international environmental agreements, the solutions having the property of coalitional internal stability, when they exist, are compared in this paper with the solutions with...

The paper is not intended for game theorists - unless they are interested in learning how their theories, and the theory of environmental games as developed in a forthcoming book, are being used for studying the current problem of climate change. Similarly for economists. In general, the...

This paper introduces a core concept, called the γ-core, in the primitive framework of a strategic game. For a certain class of strategic games, it is a weaker concept than the strong Nash equilibrium, but in general stronger than the conventional α- and β- cores. We argue that the coalition...

This paper provides a methodology to study coalition formation problems with externalities and heterogeneous players, when some subset of the players can act as “coalition developers” over time. The framework provided here allows to explicitly predict the timing of admission to coalitions,...

Is selfishness always a bad thing, in the sense that people can only be better off when everyone is concerned with the well-being of others as well as with his own, or are there situations in which altruism can actually make things worse for all people involved ? This paper tackles this question...