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Disclosure, trust and persuasion in insurance markets

De Meza, David E.; Irlenbusch, Bernd; Reyniers, Diane J. - 2010

This high-stakes experiment investigates the effect on buyers of mandatory disclosures concerning an insurance policy's value for money (the claims ratio) and the seller's commission. These information disclosures have virtually no effect despite most buyers claiming to value such information....

Persistent link: https://www.econbiz.de/10008688915

Inflation persistence and the Phillips curve revisited

Karanassou, Marika (contributor); … - 2007

A major criticism against staggered nominal contracts is that they give rise to the so called "persistency puzzle" - although they generate price inertia, they cannot account for the stylised fact of inflation persistence. It is thus commonly asserted that, in the context of the new Phillips...

Persistent link: https://www.econbiz.de/10003531676

A theory of price adjustment under loss aversion

Ahrens, Steffen; Pirschel, Inske; Snower, Dennis J. - 2014

We present a new partial equilibrium theory of price adjustment, based on consumer loss aversion. In line with prospect … theory, the consumers' perceived utility losses from price increases are weighted more heavily than the perceived utility … an otherwise standard dynamic neoclassical model of monopolistic competition. The resulting theory of price adjustment is …

Persistent link: https://www.econbiz.de/10010350414

Asymmetric labor market institutions in the EMU and the volatility of inflation and unemployment differentials

Abbritti, Mirko; Müller, Andreas - 2012

How does the asymmetry of labor market institutions affect the adjustment of a currency union to shocks? To answer this question, this paper sets up a dynamic currency union model with monopolistic competition and sticky prices, hiring frictions and real wage rigidities. In our analysis, we...

Persistent link: https://www.econbiz.de/10009536516

On reputation : a microfoundation of contract enforcement and price rigidity

Fehr, Ernst (contributor); Brown, Martin (contributor); … - 2008

We study the impact of reputational incentives in markets characterized by moral hazard problems. Social preferences have been shown to enhance contract enforcement in these markets, while at the same time generating considerable wage and price rigidity. Reputation powerfully amplifies the...

Persistent link: https://www.econbiz.de/10003750306

Labor turnover costs, workers' heterogeneity, and optimal monetary policy

Faia, Ester; Lechthaler, Wolfgang; Merkl, Christian - 2009

We study the design of optimal monetary policy in a New Keynesian model with labor turnover costs in which wages are set according to a right to manage bargaining where the firms' counterpart is given by currently employed workers. Our model captures well the salient features of European labor...

Persistent link: https://www.econbiz.de/10003879356

Famous after death : the effect of a writer's death on book sales

Ponzo, Michela; Scoppa, Vincenzo - 2022

In the standard neoclassical model consumers use all the available information and the demand for goods depends exclusively on preferences and prices whereas other spurious information do not play any role. In the market for books, we investigate if - in contrast to the standard model - the...

Persistent link: https://www.econbiz.de/10013346977

The effect of deceptive advertising on consumption of the advertised good and its substitutes : the case of over-the-counter weight loss products

Cawley, John H.; Avery, Rosemary J.; Eisenberg, Matthew - 2013

This paper is the first to estimate the impact of exposure to deceptive advertising on consumption of the advertised product and its substitutes. We study the market for over-the-counter (OTC) weight-loss products, a market in which deceptive advertising is rampant and products are generally...

Persistent link: https://www.econbiz.de/10009717705

The compromise effect in action : lessons from a restaurant's menu

Pinger, Pia; Ruhmer-Krell, Isabel; Schumacher, Heiner - 2016

The compromise effect refers to individuals' tendency to choose intermediate options. Its existence has been demonstrated in a large number of hypothetical choice experiments. This paper uses field data from a specialties restaurant to investigate the existence and strength of the compromise...

Persistent link: https://www.econbiz.de/10011449871

An Afriat theorem for the collective model of household consumption

Cherchye, Laurens (contributor); Rock, Bram de (contributor) - 2008

We provide a nonparametric 'revealed preference' characterization of rational household behavior in terms of the collective consumption model, while accounting for general (possibly non-convex) individual preferences. We establish a Collective Axiom of Revealed Preference (CARP), which provides...

Persistent link: https://www.econbiz.de/10003771615

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