We present an overlapping generations model with two families who can guarantee old age support either by intra-family transfers from child to parent or via a tax-financed public pension system encompassing both families.We derive the individually and family-specific optimal decisions and...

One of the long-standing puzzles in economics is why wages do not fall sufficiently in recessions so as to avoid increases in unemployment. Put differently, if the competitive market wage declines, why don't employers simply force their employees to accept lower wages as well? As an alternative...

Suppose two parties have to share a surplus of random size.Each of the two can either commit to a demand prior to the realization of the surplus - as in the Nash demand game with noise - or remain silent and wait until the surplus was publicly observed.Adding the strategy to wait to the noisy...

We present an experimental study of a risky sequential bargaining to model negotiations in risky joint ventures that proceed through multiple stages.Our example is the production of a movie that may give rise to a sequel, so actors and producers negitiate sequentially.We compare the predictions...