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Anderlini, Luca; Felli, Leonardo - London School of Economics (LSE) - 1998

We identify the inefficiencies that arise when negotiation between two parties takes place in the presence of transaction costs. First, for some values of these costs it is efficient to reach an agreement but the unique equilibrium outcome is one in which agreement is never reached. Secondly,...

Persistent link: https://www.econbiz.de/10010928645

Transaction costs and the robustness of the Coase Theorem

Anderlini, Luca; Felli, Leonardo - London School of Economics (LSE) - 2000

This paper explores the extent to which the presence of ex-ante transaction costs may lead to failures of the Coase Theorem. In particular we identify and investigate the basic ‘hold-up problem’ which arises whenever the parties to a Coasian negotiation have to pay some ex-ante costs for the...

Persistent link: https://www.econbiz.de/10010745037

Costly coasian contracts

Anderlini, Luca; Felli, Leonardo - London School of Economics (LSE) - 1998

We identify and investigate the basic ‘hold-up problem’ which arises whenever each party to a contract has to pay some ex-ante cost for the contract to become feasible. We then proceed to show that, under plausible circumstances, a ‘contractual solution’ to this hold-up problem is not...

Persistent link: https://www.econbiz.de/10010745370

Response Time under Monetary Incentives:the Ultimatum Game

Brañas-Garza, Pablo; León-Mejía, Ana; Miller, Luis M. - Max-Planck-Institut für Ökonomik <Jena> / Abteilung … - 2007

This paper studies the response times of experimental subjects playingthe Ultimatum game in a laboratory setting using monetary incentives.We find that proposals are not significantly correlated with responsetime, whereas responders’ behavior is positively and significantlycorrelated. Hence,...

Persistent link: https://www.econbiz.de/10005866540

Moral Distance and Moral Motivations in Dictator Games

Aguiar, Fernando; Brañas-Garza, Pablo; Miller, Luis M. - Max-Planck-Institut für Ökonomik <Jena> / Abteilung … - 2007

We perform an experimenta linvestigation using a dictator game inwhich individuals must make a moral decision —to give or not to give anamount of money to poor people in the Third World. A questionnaire inwhich the subjects are asked about the reasons for their decision showsthat, at least in...

Persistent link: https://www.econbiz.de/10005866577

Personal Identity in the Dictator Game

Aguiar, Fernando; Brañas-Garza, Pablo; Paz Espinosa, Maria - Max-Planck-Institut für Ökonomik <Jena> / Abteilung … - 2008

function is studied experimentally.The experiment allow us to study the main parametersof the model, suggesting that we should …

Persistent link: https://www.econbiz.de/10005866610

International portfolio choice, liquidity constraints and the home equity bias puzzle

Michaelides, Alexander - London School of Economics (LSE) - 2003

undiversifiable labor income risk. Optimal portfolios are internationally diversified while positive correlation between domestic … with a small amount of buffer stock saving, while exchange rate risk makes foreign investments less appealing to risk …

Persistent link: https://www.econbiz.de/10010928614

Portfolio choice with internal habit formation : a life-cycle model with uninsurable labor income risk

Gomes, Francisco J.; Michaelides, Alexander - London School of Economics (LSE) - 2003

labor income risk and stock-market participation costs. In contrast to the initial motivation, we find that the model is not …

Persistent link: https://www.econbiz.de/10010928771

Asset pricing with limited risk sharing and heterogeneous agents

Gomes, Francisco; Michaelides, Alexander - London School of Economics (LSE) - 2005

simultaneously matching stock market participation and individual asset holdings. The high risk premium is driven by incomplete risk … negligible impact on the risk premium, contrary to the results of models where it is imposed exogenously. …

Persistent link: https://www.econbiz.de/10010744865

Optimal life-cycle asset allocation: understanding the empirical evidence

Gomes, Francisco; Michaelides, Alexander - London School of Economics (LSE) - 2003

We show that a life-cycle model with realistically calibrated uninsurable labor income risk and moderate risk aversion … risk aversion. Households with low risk aversion smooth earnings shocks with a small buffer stock of assets and … consequently most of them (optimally) never invest in equities. Therefore, the marginal stockholders are (endogenously) more risk …

Persistent link: https://www.econbiz.de/10010746160