I revisit the Rubinstein (1982) model for the classic problem of price hag- gling and show that bargaining can become a 'trap,' where equilibrium leaves one party strictly worse off than if no transaction took place (e.g., the equilibrium price exceeds a buyer's valuation). This arises when one...

This paper presents an analysis of general time preferences in the canonical Rubinstein (1982) model of bargaining, allowing for arbitrarily history-dependent strategies. I derive a simple sufficient structure for optimal punishments and thereby fully characterize (i) the set of equilibrium...

In models of non-deterministic contest, players exert irreversible effort in order to increase their probability of winning a prize. The most prominent functional form of the win probability in the literature is the so-called logit" contest success function. We provide a simple micro-foundation...

Social capital is defined as the shared knowledge, trust, and culture, embodied in the structural forms of networks and other stable inter-agent relationships. Social capital has been shown to be more difficult to build than economic capital, and to have greater beneficial effects for community...

Theoretical models of the Kuznets Curve have been purely analytical with little contribution towards an understanding of the timing of the process and the presence of additional mechanisms affecting its timing. This paper proposes an agent-based version of Acemoglu and Robinson's model of the...

This paper derives a gravity equation for commuter flows from a simple spatial labor market model, and uses it to identify the effect of regional borders on commuting. This structural approach allows us to identify the relevant control variables and sources of potential omitted variable bias....

The paper assesses how close Asian countries are to an Optimal Currency Area in terms of business cycle synchronization, with a focus on supply shock asymmetry. Based on a Structural VAR model, the importance of symmetric and asymmetric supply shocks is teasted for all ASEAN+3 countries. In...

The variable threat-bargaining model of Nash (1953) assumes that threats in the senseof binding commitments as to what one will do if bargaining ends in conflict, are chosenbefore bargaining. By comparison, late threats to be chosen after bargaining end in conflict,appear more natural and would...

In this paper we study the robustness of the deadline effect in bargaininggames using constant and slowly decreasing pies, different time horizons,and both constant and alternating role modes. With decreasing pies efficiency requires early agreements while constant pies allow for efficient late...

We often observe minority ethnic groups at a disadvantage relative to the majority. Why is this and what can be done about it? Efforts made to assimilate, and time, are two elements working to bring the minority into line with the majority. A third element, the degree to which the majority...