We consider the possibility a draft increases the likelihood individuals will invest in human capital in the military. This possibility exists because those drafted have less time to reap the return from human capital investment since, with a volunteer military, one need not enlist. A draft is...

Akerlof (2012, 2013) has argued individuals often do not behave according to rational expectations. He shows how buyers in a complete lemon’s market are worse off if they behave irrationally---like loons. We examine several different lemon’s market situations (including when workers may...

More able individuals may over-investment in education when education signals ability. If education directly increases productivity, increasing education cost for the less able may increase welfare by reducing over-investment by the more able, but will not do so if such cost is already either...