We study the consequences of a solidarity property that specifies how a value for cooperative games should respond if some player forfeits his productivity, i.e., becomes a null player. Nullified solidarity states that in this case either all players weakly gain together or all players weakly...

We provide a new interpretation of the potential of the Shapley value as the expected worth of some random partition of the player set. Using this insight, we advocate the potential as an index of power concentration in simple monotonic games.

We study cooperative games with transferable utility and limited cooperation possibilities. The focus is on communication structures where the set of players forms a circle, so that the possibilities of cooperation are represented by the connected sets of nodes of an undirected circular graph....

We derive several implications of incentive compatibility in general (i.e., not necessarily quasilinear) environments. Building on Kos and Messner (2013), we provide a (partial) characterization of incentive compatible mechanisms.

A bank that needs a public bail-out to avoid liquidation can use financial contracts to provide contingent liquidation rights to investors and force the government to increase public support. Limiting the size of the bail-out before knowing the bank’s financial condition decreases welfare if...

Under a deadweight loss of tax and transfer, there is tension between the optimal policy choices of a Rawlsian social planner and a utilitarian social planner. However, when with a weight greater than a certain critical value the individuals’ utility functions incorporate distaste for low...

We introduce an augmented Becker–DeGroot–Marschak mechanism for the revelation of willingness-to-accept and willingness-to-pay in transaction cycles. The mechanism can be used to test for a behavioral anomaly.

Opportunities for shrouded pricing drive down upfront price as firms compete to capture new customers. Unless the surcharge is sufficiently high, consumers are worse off if the practice is banned, assuming Cournot–Nash equilibrium and isoelastic demand.

Subjects who overestimate their performance in experimental tasks unrelated to travel are less willing to insure against failing in the task and also less inclined to buy travel insurance. This suggests intrinsic optimism influences insurance demand and diminishes adverse selection.

This paper is concerned with the problem of extending an antisymmetric binary relation on a set to a linear order on the power set. A necessary and sufficient condition is offered.