Despite the fact that the distributional impact of innovation has been recognized in the social science literature, hardly any work has been done on the distributional politics of innovation policy. This study offers a first step in this direction as well as asking whether a government’s...

This paper formalizes the pervasive phenomenon of the self-serving bias within the framework of reference dependent preferences. This formulation allows the stating of a simple rule to assess the existence of the bias at the aggregate level as well as a procedure that identifies the minimum...

Randomized controlled trials (RCT) have become a dominant empirical tool in applied economics. The internal validity of RCTs crucially depends on the (implicit) assumption that the procedure assigning subjects to treatment and control groups has no effect on behavior. We show theoretically that...

We show how the common occurrence of seeing exceedingly high claims in disputes and litigations about how to share a limited resource can be rationalized by a model in which claimants display reference dependent preferences, expect the judge to use a generalized social welfare function, and...

We study the relative performance of disclosure and auditing in organizations. We consider the information transmission problem between two decision makers who take actions at dates 1 and 2 respectively. The first decision maker has private information about a state of nature that is relevant...

This paper studies how different behavioural norms affect individual and social welfare in a population with heterogeneous preferences. I assume preferences are private information, and that interactions between individuals do not involve communication, nor bargaining. I first compare two...

This paper presents an idealized model of social interaction, where preferences are private information and individuals cannot condition their behavior on the identity of whom they are interacting with. An optimal decentralized benchmark rule is identified, where each individual imposes some...

This paper provides new empirical evidence on the changes in the Italian wage distribution using administrative data from 1985 to 1996. Various statistical indicators are used to document a slight, but not negligible, increase in wage inequality. Standard decompositions of inequality indices by...

We study how the closeness of electoral race affect the number of invalid ballots under the traditional paper-ballot voting technology. Using a large dataset from the Italian parliamentary elections in 1994-2001, we find a strong positive correlation between the closeness of electoral race and...

We consider the portfolio selection problem in the accumulation phase of a defined contribution (DC) pension scheme. We solve the mean-variance portfolio selection problem using the embedding technique pioneered by Zhou and Li (2000) and show that it is equivalent to a target-based optimization...