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Search Frictions and Efficiency in Decentralized Transportation Markets
Brancaccio, Giulia; Kalouptsidi, Myrto; Papageorgiou, … - 2022
frictions, such as taxicabs, trucks and bulk shipping. We illustrate the impact of two externalities: the well-known thin …/thick market externalities and what we call pooling externalities. We characterize analytically the conditions for efficiency, show …
Persistent link: https://www.econbiz.de/10013307044
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Three Sides of Harberger Triangles
Hines Jr., James R. - 2021
Harberger triangles are used to calculate the efficiency costs of taxes, government regulations, monopolistic practices, and various other market distortions. This paper considers the historical development of Harberger triangles, the associated theoretical controversies, and the contribution of...
Persistent link: https://www.econbiz.de/10013237933
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Pecuniary Externalities in Economies with Financial Frictions
Davila, Eduardo - 2016
types of pecuniary externalities: distributive externalities that arise from incomplete insurance markets and collateral … externalities that arise from price-dependent financial constraints. For both types of externalities, we identify three sufficient … pecuniary externalities. We demonstrate how to employ our framework in a number of applications. Whereas collateral …
Persistent link: https://www.econbiz.de/10012986288
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International Credit Flows and Pecuniary Externalities
Brunnermeier, Markus K. - 2015
externalities. First, an undercapitalized country borrows too much since each firm does not internalize that an increase in …
Persistent link: https://www.econbiz.de/10013031034
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Externalities, Incentives and Failure to Achieve National Objectives in Decentralized Economies
Aizenman, Joshua; Isard, Peter - 2021
presence of externalities. The paper employs a two-period, open economy framework in which the central government allocates its … externalities. This is not only because debt relief that expands the availability of current resources has positive direct income …
Persistent link: https://www.econbiz.de/10013222246
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Fixed-Term Employment Contracts in an Equilibrium Search Model
Alvarez, Fernando - 2007
This paper analyzes the effects of fixed-term contracts using a version of the Lucas and Prescott island model with undirected search. A fixed-term contract of length J is modeled as a tax on separations of workers with tenure higher than J . While in principle these policies require a very...
Persistent link: https://www.econbiz.de/10012778082
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Decentralized Matching with Aligned Preferences
Niederle, Muriel; Yariv, Leeat - 2021
We study a simple model of a decentralized market game in which firms make directed offers to workers. We focus on markets in which agents have aligned preferences. When agents have complete information or when there are no frictions in the economy, there exists an equilibrium that yields the...
Persistent link: https://www.econbiz.de/10013218974
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Misallocation, Economic Growth, and Input-Output Economics
Jones, Charles I. - 2011
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
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Inefficient Investment Waves
He, Zhiguo - 2012
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
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Assessing International Efficiency
Heathcote, Jonathan - 2013
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