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On the Design of Global Refunding and Climate Change

Gersbach, Hans; Winkler, Ralph - 2007

We design a global refunding scheme as a new international approach to address climate change. A global refunding system allows each country to set its carbon emission tax, while aggregate tax revenues are partially refunded to member countries in proportion to the relative emission reductions...

Persistent link: https://www.econbiz.de/10011753133

Minority Voting and Long-term Decisions

Fahrenberger, Theresa; Gersbach, Hans - 2007

In this paper we propose minority voting as a scheme that can partially protect individuals from the risk of repeated exploitation. We consider a committee that meets twice to decide about projects where the first-period project may have a long-lasting impact. In the first period a simple open...

Persistent link: https://www.econbiz.de/10011753134

On the Design of Basic-Research Policy

Gersbach, Hans; Schneider, Maik T.; Schneller, Olivier - 2008

We augment a Schumpeterian growth model with a public basic-research sector to examine how much a country should invest in basic research. We find that the closer the country is to the world’s technological frontier the more the government should invest in basic research. Basic-research...

Persistent link: https://www.econbiz.de/10011753143

Forward Guidance for Monetary Policy: Is It Desirable?

Gersbach, Hans; Hahn, Volker - 2008

In this paper we assess whether forward guidance for monetary policy regarding the future path of interest rates is desirable. We distinguish between two cases where forward guidance for monetary policy may be helpful. First, forward guidance may reveal private information of the central bank....

Persistent link: https://www.econbiz.de/10011753148

Banking with Contingent Contracts, Macroeconomic Risks, and Banking Crises

Gersbach, Hans - 2008

We examine banking competition when deposit or loan contracts contingent on macroeconomic shocks become feasible. We show that the risk allocation is efficient, provided that banks are not bailed out. In this case, banks may shift part of the risk to depositors. The private sector insures the...

Persistent link: https://www.econbiz.de/10011753157

Vote-Buying and Growth

Gersbach, Hans; Mühe, Felix - 2008

Vote-buying is widely used by parties in developing countries to influence the outcome of elections. We examine the impact of vote-buying on growth. We consider a model with a poverty trap where redistribution can promote growth. We show that vote-buying contributes to the persistence of poverty...

Persistent link: https://www.econbiz.de/10011753158

Banking-on-the-Average Rules

Gersbach, Hans; Hahn, Volker - 2009

In this paper, we argue for a regulatory framework under which a bank’s required level of equity capital depends on the … equity capital of its peers. Such bankingon- the-average rules are transparent and could also be combined with the current … abstain from gambling. Moreover, it alleviates socially harmful consequences of conventional equity-capital rules, which may …

Persistent link: https://www.econbiz.de/10011753171

Club Theory and Household Formation

Gersbach, Hans; Haller, Hans - 2009

The relationship between our general equilibrium model with multi- member households and club models with multiple private goods is investigated. The main distinction in the definitions consists of the equilibrium concepts. As a rule, competitive equilibria among house- holds where no group of...

Persistent link: https://www.econbiz.de/10011753174

Tax Contracts and Elections

Gersbach, Hans; Schneider, Maik T. - 2009

In this paper we examine the impact of tax contracts as a novel institution on elections, policies, and welfare. We consider a political game in which three parties compete to form the government. Parties have policy preferences about the level of public-good provision and benefit from perks...

Persistent link: https://www.econbiz.de/10011753187

Default Risk in Stochastic Volatility Models

Gersbach, Hans; Surulescu, Nicolae - 2010

We consider a stochastic volatility model of the mean-reverting type to describe the evolution of a firm’s values instead of the classical approach by Merton with geometric Brownian motions. We develop an analytical expression for the default probability. Our simulation results indicate that...

Persistent link: https://www.econbiz.de/10011753195