Many political commentators diagnose an increasing polarization of the U.S. electorate into two opposing camps. However, in standard spatial voting models, changes in the political preference distribution are irrelevant as long as the position of the median voter does not change. We show that...

The unprecedented access of firms to consumer level data not only facilitates more precisely targeted individual pricing but also alters firms' strategic incentives. We show that exclusive access to a list of consumers can provide incentives for a firm to endogenously assume the price leader's...

In this paper, we analyze a class of models in which there are interjurisdictional spillovers among heterogeneous jurisdictions, as illustrated for instance by CO2 emissions that affect the global environment. Each jurisdiction's emissions depend upon the local stock of private capital. Capital...

This paper investigates political uncertainty as a source of regulatory risk. It shows that political parties have incentives to reduce regulatory risk actively: Mutually beneficial pre-electoral agreements that reduce regulatory risk always exist. Agreements that fully eliminate it exist when...

This paper analyzes the a priori influence of the European Parliament (EP) and the Council of Ministers (CM) on legislation of the European Union adopted under its codecision procedure. In contrast to studies which use conventional power indices, both institutions are assumed to act...

In this paper, we analyze a class of models in which there are interjurisdictional spillovers among heterogeneous jurisdictions, as illustrated for instance by CO2 emissions that affect the global environment. Each jurisdiction's emissions depend upon the local stock of private capital. Capital...

We study a principal-agent model in which the agent can provide ex post additional relevant information regarding his performance. In particular, he can provide a legitimate excuse, that is, evidence that a poor result is only due to factors outside his control. However, building a convincing...

In many countries, important thresholds in examinations act as a gateway to higher levels of education and/or good employment prospects. This paper examines the consequences of just failing a key high stakes national examination in English taken at the end of compulsory schooling in England. It...

In a centralized federation, where tax rates and taxation rules are set by the federal government, manipulating the thoroughness of tax auditing and the effectiveness of tax collection could be attractive for regional authorities because of a variety of reasons. These range from tax competition...