Showing 1 - 10 of 13
Outcomes in social dilemmas often have a stochastic component. We report experimental findings from public good games with both correlated and independent risk across players. We find that the presence of both types of risk prevents the decay of cooperation typically observed in the standard...
Persistent link: https://www.econbiz.de/10013208783
How should taxes, government expenditures, the primary and fiscal surpluses and government liabilities be set over the business cycle? We assume that the government chooses expenditures and taxes to maximize the utility of a representative household, utility is increasing in government...
Persistent link: https://www.econbiz.de/10010263265
We consider optimal stopping problems in uncertain environments for an agent assessing utility by virtue of dynamic variational preferences or, equivalently, assessing risk by dynamic convex risk measures. The solution is achieved by generalizing the approach in terms of multiple priors...
Persistent link: https://www.econbiz.de/10010270015
I study a two-period model of nonlinear, information constrained income taxation. It is shown that time-consistent taxation of annual income welfare-dominates time-consistent taxation of lifetime income if preferences are such that stationary allocations are efficient. If uncertainty is taken...
Persistent link: https://www.econbiz.de/10010270135
We consider long-run behavior of agents assessing risk in terms of dynamic convex risk measures or, equivalently, utility in terms of dynamic variational preferences in an uncertain setting. By virtue of a robust representation, we show that all uncertainty is revealed in the limit and agents...
Persistent link: https://www.econbiz.de/10010270415
We consider long-run behavior of agents assessing risk in terms of dynamic convex risk measures or, equivalently, utility in terms of dynamic variational preferences in an uncertain setting. By virtue of a robust representation, we show that all uncertainty is revealed in the limit and agents...
Persistent link: https://www.econbiz.de/10010272543
In this paper we give an alternative characterization for time-consistent sets of measures in a discrete setting. For each measure P in a time-consistent set Ρ we get a distinct set of predictable processes which in return decribe the P uniquely. This implies we get a one-to-one correspondence...
Persistent link: https://www.econbiz.de/10010272594
In a plain-vanilla New Keynesian model with two-period staggered price-setting, discretionary monetary policy leads to multiple equilibria. Complementarity between the pricing decisions of forward-looking firms underlies the multiplicity, which is intrinsically dynamic in nature. At each point...
Persistent link: https://www.econbiz.de/10010298291
We analyze the Foster-Hart measure of riskiness for general distributions in dynamic settings. The Foster-Hart measure avoids bankruptcy in the long run. It is not time-consistent.
Persistent link: https://www.econbiz.de/10010427177
We study optimal time-consistent distortionary taxation when the repayment of government debt is not enforceable. The government taxes labor income or issues noncontingent debt in order to finance an exogenous stream of stochastic government expenditures. The government can repudiate its debt...
Persistent link: https://www.econbiz.de/10012030264