Empirical as well as experimental evidence strongly suggests that bidders in common value auctions typically do not conform to the requirements of perfect rationality. Eyster and Rabin (2005) develop a theory and an equilibrium concept - x-cursed equilibrium - for bounded rational bidding in...

The calibration theorem by Rabin (2000) implies that seemingly plausible smallstake choices under risk imply implausible large-stake risk aversion. This theorem is derived based on the expected utility of wealth model. However, Cox and Sadiraj (2006) show that such implications do not follow...

This paper uses a overlapping generation general equilibrium model to study a reform of the social security system, going from an unfunded to a funded system. We also analyze the effects of this reform on the incentives of young generations to acquire skills. the main objective is to evaluate...

This paper analyzes the quantitative role of idiosyncratic uncertainty in an economy in which rational agents vote on hypothetical social security reforms. We construct an Overlapping Generations economy in which individuals face idiosuncratic risk with respect to their labor productivity and...

In this paper we analyze how the optimal consumption, investment and life insur- ance rules are modified by the introduction of a class of time-inconsistent preferences. In particular, we account for the fact that an agents preferences evolve along the planning horizon according to her...

This paper investigates the spectacular and successful growth of New Zealand kiwifruit production and exports between 1984 and 2009. It explores the evolution, current status, future prospects and challenges facing the industry where more than 90 percent of the output is exported. The study...

This paper investigates the relationship between various market imperfections and the skill premium. The model in this paper assumes perfectly competitive labor markets but distorted product and financial markets. The model predicts that the skill premium is positively correlated with market...

Este articulo analiza los efectos de dos posibles reformas en la financiacion del actual sistema de Seguridad Social en Espana, y cuantifica los efectos de dichas reformas sobre los principales agregados macroeconomicos. El tipo de reformas que se analizan son la sustitucion del actual regimen...

Empirical studies of intergenerational transfers usually find that bequests are equally divided among heirs while inter vivos gifts tend to be compensatory. Using the 1992 and 1994 waves of the Health and Retirement Study, we find that only 4% of parents who give, divide their gifts equally...

We study the motives behind parents’ transfers to their children, and the relationship between tangible transfers and educational investments. Another issue is the channels parents choose for tangible transfers. Do they use bequests and inter vivos gifts as substitutes or complements? We use a...