Nowadays many employers offer their employees the possibility of an insurance against too large losses in income when retiring or becoming disabled. This paper models the optimization problem of the employer when setting up such a so-called pension fund. Not surprisingly, it turns out that the...

The paper analyzes a problem of optimal auction design when the seller faces asymmetrically informed bidders. Specifically, we consider a continuum of risk-neutral uninformed bidders taking part into the auction along with n risk-averse informed bidders. The contribution of the paper is...

In this paper we characterize choice behaviour that picks the second largest element if there is a uniquely largest; otherwise, the largest elements are picked. Having defined our choice function, we offer a complete characterization of the latter in terms of pure choice function conditions....

In this paper we fully characterize an individual's choice behaviour according to three different so-called external references. The first system which we describe axiomatically is standard utility maximization or preference optimization. The second approach characterizes the choice of the...

This paper obtains finite analogues to propositions that a previous literature obtained about the informational efficiency of mechanisms whose possible messages form a continuum. Upon reaching an equilibrium message, to which all persons “agree”, a mechanism obtains an action appropriate to...

This paper obtains finite counterparts of previous results that showed the informational efficiency of the Walrasian mechanism among all mechanisms yielding Pareto-optimal individually rational trades in exchange economies while using a continuum of possible messages. In particular, we develop...

We characterize voting procedures according to the social choice correspondence they implement when voters cast ballots strategically, applying iteratively undominated strategies. In elections with three candidates, the Borda Rule is the unique positional scoring rule that satisfies 'unanimity'...

The present paper provides three different support results for the Nash bargaining solution of $n$-person bargaining games. First, for any bargaining game there is defined a non-cooperative game in strategic form, whose unique Nash equilibrium induces a payoff vector that coincides with the Nash...

A group of individuals meet to share the cost and determine output allocations of a partial-excludable public good. We demonstrate that, for general cost functions and preferences that satisfy the Spence-Mirlees sorting condition, the serial cost-sharing formula (Moulin, 1994) has remarkable...

This paper considers a model of (consensual) democracy where political parties engage first in electoral competition, and they share policy-making power afterward according with the votes gathered in the election. The paper uncovers the difficulties to guarantee stability in this institutional...