Motivated by a central banker with a symmetric inflation zone target, we assume in this letter that the loss function of a policy maker can be approximated by the quartic form. For non-normal distributions, we show that such a loss function implies a systematic inflation bias even when the bank...

In the analysis of group identification, Kasher and Rubinstein (1997), Logique Analyse 160, 385-395, have shown that any method to aggregate the opinions of a group of agents about the individuals in the group that posses a specific attribute, such as race, nationality, profession, etc., must be...

The siting of public facilities such as prisons or waste disposal facilities typically faces rejection by local populations (the "NIMBY" syndrome, for Not In My BackYard). These public goods exhibit a private bad aspect creating an asymmetry: all involved communities benefit from their...

This paper develops a model of small open economy, with a differentiated goods sector and voluntary provisioning of public good. It is shown that trade policy can alter the quantity of public good provided in the equilibrium. Interestingly, tariffs may fail to protect, leading to a Metzler...

This paper develops a model of legislative spending in which revenues can be spent through earmarks or a general fund. Legislative choice is modeled as a Baron and Ferejohn style legislative bargaining game. The novel approach is to model the bargaining process as a two-stage game reflecting the...

The private exchange of charitable gifts (e.g. charity gift-cards) has recently become an important source of donations to charities. In this paper we study this new phenomenon using the classical model of private provision of public goods, modified to account for exchange of private gifts....