We consider a singular event of the following form: in a simple voting game, a particular division of the voters resulted in a positive outcome. We propose a plausible measure that quantifies the causal contribution of any given voter to the outcome. This measure is based on a conceptual...

There is an intensive dispute in political economics about the impact of institutions on income redistribution. While the main focus is on comparison between different forms of representative democracy, the influence of direct democracy on redistribution has attracted much less attention....

In a general equilibrium product-cycle model, lower trade barriers in-crease Southern purchasing power, which lifts long-run growth by increasing the profit from innovation. In the short run, factors of production must be reallocated inside firms, which lowers the opportunity cost of innovation,...

We investigate the impact of information about student satisfaction on university choice, using data from the UK’s National Student Survey (NSS) and on applications to undergraduate degree courses. We show that the NSS has a small, statistically significant effect on applications at the...

Allowing for a richer information structure than usual, we show that rational traders’ calculation with short-term price fluctuations may heavily influence their behaviour even if the interim price is not influenced by non-rational agents i.e. there is no noise trader risk. Instead, traders...

This paper re-examines Hayek’s insights into the problem of knowledge in markets, and argues that his analysis remains pertinent but has serious flaws. His central thesis—that the market price system is essential for communicating information and coordinating transactions wherever knowledge...

Uncertainty varies strongly over time, rising by 50% to 100% in recessions and by up to 200% after major economic and political shocks. This paper shows that higher uncertainty reduces the responsiveness of R&D to changes in business conditions - a “caution-effect” - making it more...

Market participants' risk attitudes, wealth and portfolio composition in°uence their positions in a pegged foreign currency and, therefore, may have important e®ects on the sustainability of currency pegs. We analyze such e®ects in a global game model of currency crises with continuous action...

This paper studies a dynamic model of crises with timing frictions that combines the main aspects of Morris and Shin (1998) and Frankel and Pauzner (2000). The usual arguments for existence and uniqueness of equilibrium cannot be applied. It is shown that the model has a unique equilibrium...

We develop a search-based model of asset trading, in which investors of different horizons can invest in two identical assets. The asset markets are partially segmented: buyers can search for only one asset, but can decide which one. We show that there exists a "clientele" equilibrium where one...