This paper identifies a novel function for permits: they can be used by the government as an instrument to elicit information about the intentions of private investors to put capital into an area. Such information is a crucial input for the government's decision on how much infrastructure to...

Hurricane Katrina did massive damage because New Orleans and the Gulf Coast were not appropriately protected. Wherever natural disasters threaten, the government - in its traditional role as public goods provider - must decide what level of protection to provide to an area. It does so by...