We analyze a long-term contracting problem involving common uncertainty about a parameter capturing the productivity of the relationship, and featuring a hidden action for the agent. We develop an approach that works for any utility function when the parameter and noise are normally distributed...

We discuss a principal-agent model in which the principal has the opportunity to include a non-compete agreement in the employment contract. We show that not imposing such an agreement can be beneficial for the principal as the possibility to leave the firm generates implicit incentives for the...

This survey presents the various methods to estimate the size of the shadow economy, their strengths and weaknesses and the estimation results. The purpose of the survey is threefold. Firstly, it demonstrates that no ideal method to estimate the size and development of the shadow economy exists....

This paper analyses the effect of local crime rates on the mental well-being of residents. Our identification strategy addresses the problem of sorting, and endogenous moving behaviour. We find that crime causes considerable mental distress of residents, and that these effects are mainly driven...

We explore the individual and joint explanatory power of concepts from economics, psychology, and criminology for criminal behavior. More precisely, we consider risk and time preferences, personality traits from psychology (Big Five and locus of control), and a self-control scale from...

Recessions lead to short-term job loss, lower levels of happiness and decreasing income levels. There is growing evidence that workers who first join the labour market during economic downturns suffer from poor job matches that have a sustained detrimental effect on their wages and career...

In economic models, risk and social preferences are major determinants of criminal behavior. In criminology, low self-control is considered a fundamental cause of crime. Relating the arguments from both disciplines, this paper studies the relationship between self-control and both risk and...

The standard expected utility model of tax evasion predicts that evasion is decreasing in the marginal tax rate (the Yitzhaki puzzle). The existing literature disagrees on whether prospect theory overturns the puzzle. We disentangle four distinct elements of prospect theory and find loss...