This paper constructs an equilibrium model of entrepreneurial innovation where individuals differ in their attitude toward uncertainty.Unlike previous models of innovation, the firm-formation process is endogenous.An entrepreneur, who owns residual profits, utilizes an uncertain technology and...

An investment bubble is a period of excessive, and predictably unpro…table, investment(DeMarzo, Kaniel and Kremer, 2007, p.737). Such bubbles most often accompany the arrival of some new technology, such as the tech stock boom and bust of the late 1990s and early 2000s. We provide a rational...

Predictive Risk Models which utilize routinely collected data to develop algorithms are used in England to stratify patients according to their hospital admission risk. An individual’s risk score can be used as a basis to select patients for hospital avoidance programmes. This paper presents a...

We present results from a survey conducted in December 2011, in order to see if introduction of Demeny voting system will have the desired have effect of addressing gerentocracy. We have identified several facts from the survey that provides a positive answer to this question. We found that...

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The private health insurance sector is one of the most regulated sectors in Australia. The Private Health Insurance Incentives Scheme, along with community rating, is intended to make private insurance equitable, profitable and popular. We argue that the subsidy to health insurance ought to be a...

This paper has two objectives. First, we construct a theoretical model which explains the empirical evidence that in developing countries, first-born children are more likely to be child laborers than later-born. Second, we explore the long-run consequences of child labor regulations within our...

A well-known result in the medical insurance literature is that zero co-insurance is never second-best for insurance contracts subject to moral hazard. We replace the usual expected utility assumption with a version of the rank-dependent utility (RDU) model that has greater experimental support....

Abstract This paper contributes to the literature on information transmission in Sender-Receiver games. We compare cheap-talk games to games with verifiable messages (persuasion games). We consider equilibria in which the Sender's private information (type) is fully revealed to the Receiver. We...