This paper analyzes decisions on emissions of a stock pollutant under uncertainty in a two period model. Decisions are based on a weighted average of expected utility (EU) and the MaxiMin criterion. I first show that more weight on the worst case (less weight on EU) may lead to increased first...

When candidates in primary elections are ideologically differentiated (e.g., conservatives and moderates in the Republican party), then candidates with similar positions affect each others' vote shares more strongly than candidates with different ideological positions. We measure this effect in...

While research on subjective well-being abounds, comparatively little thought has been given to its practical policy implications. Two approaches to derive policy advice have emerged in the literature: One is organized in terms of the idea to maximize a hedonic social welfare function, the other...

We describe a dynamic model of costly information sharing, where private information affecting collective-value actions is transmitted by social proximity. Individuals make voluntary contributions towards the provision of a pure public good, and information transmission about quality of...

I demonstrate a straightforward but apparently widely unrecognized implication of the standard requirements for perfect competition: an economy in which consumers can choose to learn is generally not perfectly competitive. In particular, if endogenous welfare relevant learning is feasible, the...

We study learning in the Kydland and Prescott environment. Our policy maker evaluates its potential strategies regarding the announced and the actual inflation rate using its mental model. This model is forward looking and adaptive at the same time. There are two types of agents: Believers who...