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of ethanol exposure did not interfere with rats' ability to behave according to economic theory. In the first experiment …
Persistent link: https://www.econbiz.de/10013248104
One of the most important developments in the growth literature of the last decade is the enhanced appreciation of the role that the misallocation of resources plays in helping us understand income differences across countries. Misallocation at the micro level typically reduces total factor...
Persistent link: https://www.econbiz.de/10013130964
We develop a dynamic model of trading and investment with limited aggregate resources to study investment cycles. Unverifiable idiosyncratic investment opportunities imply market prices to play a role of rent distribution, distorting private investment incentives from a social point of view....
Persistent link: https://www.econbiz.de/10013103789
This paper is structured in three parts. The first part outlines the methodological steps, involving both theoretical and empirical work, for assessing whether an observed allocation of resources across countries is efficient. The second part applies the methodology to the long-run allocation of...
Persistent link: https://www.econbiz.de/10013083395
This paper analyzes pharmaceutical pricing between and within countries to achieve second best static and dynamic efficiency. We distinguish countries with and without universal insurance, because insurance undermines patients' price sensitivity, potentially leading to prices above second-best...
Persistent link: https://www.econbiz.de/10013064943
Health insurance markets face two forms of adverse selection problems. On the demand side, adverse selection leads to plan price distortions and inefficient sorting of consumers across health plans. On the supply side, adverse selection creates incentives for plans to inefficiently distort...
Persistent link: https://www.econbiz.de/10013015983
In a simple model of capital budgeting in a diversified firm where headquarters has limited power, we show that funds are allocated towards the most inefficient divisions. The distortion is greater the more diverse are the investment opportunities of the firm's divisions. We test these...
Persistent link: https://www.econbiz.de/10012783969
I propose and formalize an argument for why economists working in the welfarist normative tradition should include nonwelfarist principles in how they judge economic policy. The key idea behind this argument is that the world is too complex, and our ability to model it too limited, for us to...
Persistent link: https://www.econbiz.de/10012951872
In medicine, the reasons for variation in treatment rates across hospitals serving similar patients are not well understood. Some interpret this variation as unwarranted, and push standardization of care as a way of reducing allocative inefficiency. An alternative interpretation is that...
Persistent link: https://www.econbiz.de/10012943175
This paper develops a general theory of aggregation in inefficient economies. We provide non-parametric formulas for …
Persistent link: https://www.econbiz.de/10012943616