The article is concerned with understanding the impact of social preferences and wealth inequality on aggregate economic outcomes. We investigate how different manifestations of other-regarding preferences affect incentive contracts at the microeconomic level and how these in turn translate into...

We develop a model of social preferences for network games and study its predictions in a local public goods game with multiple equilibria. The key feature is that players' social preferences are heterogeneous. This gives room for disagreement between players about the "right" payoff ordering....

Fiscal devaluation works as an alternative instrument to monetary de- valuation, helping countries to regain competitiveness in a monetary union. Focusing on a closed economy, this paper analyzes its effects in a dynamic framework. In the case of an increasing relative love for variety, fiscal...