We set up a simple model of tax competition for mobile, highly-skilled and overconfident managers. Firms endogenously choose the compensation scheme for managers, which consists of a fixed wage and a bonus payment in the high state. Managers are overconfident about the probability of the high...

Many countries have introduced patent box regimes in recent years, offering a reduced tax rate to businesses for their IP-related income. In this paper, we analyze the effects of patent box regimes when countries can simultaneously use patent boxes and R&D subsidies to promote innovation. We...

We analyze the competition in bonus taxation when banks compensate their managers by means of fixed and incentive pay and bankers are internationally mobile. Banks choose bonus payments that induce excessive managerial risk-taking to maximize their private benefits of existing government bailout...

We model a banking union of two countries whose banking sectors differ in their average probability of failure and externalities between the two countries arise from cross-border bank ownership. The two countries face (i) a regulatory (super- visory) decision of which banks are to be shut down...

I develop a dynamic model of costly private provision of public goods where agents can also invest in cost-reducing technologies. Despite the n+1 stocks in the model, the analysis is tractable and the (Markov perfect) equilibrium unique. The framework is used to derive optimal incomplete...

Weitzman (2014) proposed that focusing international climate negotiations on a uniform carbon price is more effective than Paris style negotiations in achieving ambitious climate action. We put this hypothesis to an experimental test by simulating international negotiations on climate change in...

In seiner Thünen-Vorlesung vor dem Verein für Socialpolitik im Herbst 2020 hat Klaus Schmidt das Design von Klimaschutzverhandlungen untersucht. Er geht dabei von einem Vorschlag Martin Weitzmans aus, künftige Verhandlungen auf einen einheitlichen CO2-Mindestpreis zu fokussieren. Wäre ein...

This study examines the dynamics and determinants of inflation in the Ottoman Empire during the 1586-1913 period. There might be two main reasons for inflation: fiscal expansion and monetary expansion where the monetary expansion could be generated through the debasement of local currency...

This paper establishes the existence of relaxed solutions to mean eld games (MFGs for short) with singular controls. As a by-product, we obtain an existence of relaxed solutions results for McKean-Vlasov stochastic singular control problems. Finally, we prove approximations of solutions results...

Empirical evidence suggests that managerial overconfidence and government guarantees contribute substantially to excessive risk-taking in the banking industry. This paper incorporates managerial overconfidence and limited bank liability into a principal-agent model, where the bank manager...