Multiplicity of equilibria implies that the relationship between the outcome variable and the exogenous variables characterising a model is a correspondence rather than a function. This results in an incomplete econometric model. Incompleteness complicates identification and statistical...

Theory is divided over the effects of corruption on economic growth. However, the growing consensus based on the empirical literature is that corruption is associated with negative growth outcomes. This relationship is not necessarily linear, and causality between corruption and economic growth...

Random fields are stochastic processes indexed by a multidimensional parameter. They possess some interesting properties, e.g. isotropy and the Markov property, and satisfy laws of large numbers and weak convergence theorems under fairly general conditions. As such, random fields provide a...

Chief executive officer (CEO) compensation is defined as the sum of base pay, bonuses, stock grants, stock options, other forms of compensation and benefits. Inflation-adjusted, median total CEO compensation in the United States almost tripled between 1992 and 2000, with grants of stock options...

In a single-winner voting system, approval voting gives voters the possibility to cast a ballot for (or ‘approve of’) as many candidates as they wish – that is, voters are freed from the constraint of voting for only one candidate. The candidate receiving the greatest total...

Redlining is the practice of restricting or denying access to services in a spatially defined area. Typically, redlining refers to the practice of restricting access to financial service products, such as mortgages, to residents of minority areas. The term arose from urban activists in Chicago...

A bidding ring is a collection of bidders who collude in an auction in order to gain greater surplus by depressing competition. This entry describes some typical bidding rings and provides an introduction to the related theoretical and empirical literature.

Although economists have sought to link the health behaviours or outcomes of socially connected individuals for several decades, there has been a recent resurgence in interest and expansion in empirical techniques. Studies that attempt to estimate social network effects in health decisions face...

Economists have studied for a long time how decision-makers allocate scarce resources. The recent literature on rational inattention studies how decision-makers allocate the scarce resource attention. The idea is that decision-makers have a limited amount of attention and have to decide how to...

No trade theorems represent a class of results showing that, under certain conditions, trade in asset markets between rational agents cannot be explained on the basis of differences in information alone. They pose a challenge to provide a theoretical justification of the high trade volumes...