I argue in favor of a competitive screening approach for studying the question of coalition formation in exchange economies under asymmetric information. I obtain a new notion of core that refines Wilson (1978)'s coarse core. It is nonempty under the standard regularity conditions. I also...

The assumption of internationally identical factor intensity techniques may be one of the major causes of the HOV model's poor performance. To relax this assumption, detailed input-output data are required to compute the factor intensity techniques used in different countries; however, these...

The paper focuses on short run macroeconomic dynamics triggered by demand side shocks. In particular, the paper analyzes, in a general equilibrium framework, the impact of transitory demand side shocks on the behavior of macroeconomic variables and examines the relevance of policy instruments...

The tax reform literature, pioneered by Guesnerie [1977], uses static models but views tax reform as a dynamic process, i.e., as a policy-maker implementing incremental reforms over time. This paper studies tax reform in a dynamic version of the Diamond-Mirrlees-Guesnerie model and focuses on a...

This paper studies a competitive market model for trading indivisible commodities. Commodities can be desirable or undesirable. Agents' preferences depend on the bundle of commodities and the quantity of money they hold. We assume that agents have quasi-linear utilities in money. Using the...

This paper analyzes a bilateral trade problem where the seller makes hidden investment that influences the buyer's private valuation. Complete contracts can be written on observable trade decisions. It is shown that efficiency level in investment and trade is negatively related to the scope of...

This paper reports an experiment involving two mechanisms that allocate a single unit of an indivisible private good among two players, at no cost to either of them. Both mechanisms, proposed by Moore (1992) and Perry and Reny (1999), are compared in terms of their relative performance to assign...

Field and experimental research demonstrate the positive relationship between efficiency and both trust and trustworthiness. Berg, Dickhaut and McCabe (BDM), 1995, first showed the existence and strength of both trust and trustworthiness in a laboratory economic experiment. Building off BDM,...

Multiplicity of Mixed Bayesian Equilibria in Mechanisms Roberto Serrano and Rajiv Vohra The literature on implementation with incomplete information has often left out the consideration of mixed-strategy equilibria. This is particularly problematic for a research program that attempts to address...

This talk will describe a stream of research in experimental economics focusing on the illumination and demonstration of other-regarding preferences (ORPs). Evidence will come primarily from public goods experiments, but also bargaining games (ultimatum, dictator, trust, ...