In this paper, the link between community enforcement and co-operation in environments where trust is required is investigated. For this purpose, an assymetric trust game in which peer-to-peer sanctioning mechanisms are available is considered. Firstly, the outcome of this game is characterised...

This paper is motivated by a practical income (or wealth) taxation problem: For a public good economy where the provision of public goods is to be financed by income taxes collected from individuals, what is the optimal feasible tax mechanism when a social planner is relatively uninformed of the...

In an abstract model of division problems, we study division rules that are not manipulable through a reallocation of individual characteristic vectors within a coalition (e.g. reallocation of claims in bankruptcy problems). A coalition can be formed if members of the coalition are connected on...

This paper models individual choices of social groups and the formation of group identity, and examines the conditions with which the group identity reinforces the productivity of individuals. A social group is defined as a network that provides with a market for interactions to its members....

This paper is concerned with Bayesian reduced rank regression when instruments are weak. There have been a number of studies on weak identification problem with the application of reduced rank regression combined with singular value decomposition (SVD) method in the Bayesian framework, see...

Economic policy decisions are often informed by empirical economic analysis. While the decision-maker is usually only interested in good estimates of outcomes, the analyst is interested in estimating the model. Accurate inference on the structural features of a model, such as cointegration, can...

This study addresses the complexity in modeling contingent valuation surveys with true zeros and non-ignorable missing responses including “don’t knows†and protest responses. An endogenous switching tobit model is specified to simultaneously estimate the parameters of the...

There is considerable disagreement in the empirical macro literature as to the degree of returns to scale in U.S. production. While many studies find evidence of a small degree of increasing returns, standard errors are typically large. This issue is of importance for assessing the possibility...

Markov switching GARCH models have been developed in order to address the statistical regularity observed in financial time series such as strong persistence of conditional variance. However, Maximum Likelihood Estimation faces a implementation problem since the conditional variance depends on...