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Indeterminacy in a Forward Looking Regime Switching Model
Farmer, Roger E. A. - 2006
This paper is about the properties of Markov switching rational expectations (MSRE) models. We present a simple monetary policy model that switches between two regimes with known transition probabilities. The first regime, treated in isolation, has a unique determinate rational expectations...
Persistent link: https://www.econbiz.de/10012779321
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What Drives the Disposition Effect? An Analysis of a Long-Standing Preference-Based Explanation
Barberis, Nicholas - 2006
explanation for this puzzle is based on prospect theory. Despite its prominence, this explanation has received little formal … scrutiny. We take up this task, and analyze the trading behavior of investors with prospect theory preferences. We find that …, at least for the simplest implementation of prospect theory, the link between these preferences and the disposition …
Persistent link: https://www.econbiz.de/10012779644
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Evaluating Welfare with Nonlinear Prices
Reiss, Peter C. - 2006
This paper examines how to evaluate consumer welfare when consumers face nonlinear prices. This problem arises in many settings, such as devising optimal pricing strategies for firms, assessing how price discrimination affects consumers, and evaluating the efficiency costs of many transfer...
Persistent link: https://www.econbiz.de/10012779746
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Environmental Investment and Policy with Distortionary Taxes and Endogenous Growth
Fullerton, Don; Kim, Seung-Rae - 2021
Recent studies consider public R&D spending that affects abatement knowledge and endogenous growth, distortionary taxes that affect physical and human capital formation, pollution taxes that affect environmental degradation, and regeneration that restores natural capital. Our model combines all...
Persistent link: https://www.econbiz.de/10013222070
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Firm Entry, Trade, and Welfare in Zipf's World
di Giovanni, Julian - 2010
Firm size follows Zipf's Law, a very fat-tailed distribution that implies a few large firms account for a disproportionate share of overall economic activity. This distribution of firm size is crucial for evaluating the welfare impact of economic policies such as barriers to entry or trade...
Persistent link: https://www.econbiz.de/10013138768
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The Economic Benefits from Immigration
Borjas, George J. - 2010
Natives benefit from immigration mainly because of production complementarities between immigrant workers and other factors of production, and these benefits are larger when immigrants are sufficiently `different' from the stock of native productive inputs. The available evidence suggests that...
Persistent link: https://www.econbiz.de/10013139806
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The Welfare Economics of Default Options in 401(K) Plans
Bernheim, B. Douglas - 2011
passive choice, and other 401(k) plan features. Depending on which theory and welfare perspective one adopts, virtually any …
Persistent link: https://www.econbiz.de/10013118423
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Fiscal Policies, Capital Formation, and Capitalism
Feldstein, Martin S. - 2011
This lecture examines the effects of tax policy and social security retirement benefits on capital accumulation and economic welfare. The paper begins by examining how capital income taxes reduce the real return to savers and then discusses the welfare loss of capital income taxation relative to...
Persistent link: https://www.econbiz.de/10013118689
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Productivity and the Welfare of Nations
Basu, Susanto - 2014
We show that the welfare of a country's infinitely-lived representative consumer is summarized, to a first order, by total factor productivity (TFP) and by the capital stock per capita. These variables suffice to calculate welfare changes within a country, as well as welfare differences across...
Persistent link: https://www.econbiz.de/10013066273
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Costly Adjustment and Limited Borrowing : a Welfare Analysis of Policiesto Achieve External Balance
Aizenman, Joshua - 2008
This paper develops an analytical framework for the analysis of adjustment to adverse shocks in the presence of limited access to the international credit market. We consider an economy producing traded and non-traded goods and experiencing a permanent, unanticipated drop in the availability of...
Persistent link: https://www.econbiz.de/10012774617