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Market distortions and local indeterminacy: A general approach

Lloyd-Braga, Teresa; Modesto, Leonor; Seegmuller, Thomas - 2011

We provide a methodology to study the role of market distortions on the emergence of indeterminacy and bifurcations. Most of the specific market imperfections considered in the related literature are particular cases of our framework. Comparing them we obtain several equivalence results in terms...

Persistent link: https://www.econbiz.de/10010278392

Social networks and interactions in cities

Helsley, Robert W.; Zenou, Yves - 2011

We examine how interaction choices depend on the interplay of social and physical distance, and show that agents who are more central in the social network, or are located closer to the geographic center of interaction, choose higher levels of interactions in equilibrium. As a result, the level...

Persistent link: https://www.econbiz.de/10010278394

Does female empowerment promote economic development?

Doepke, Matthias; Tertilt, Michèle - 2011

Empirical evidence suggests that money in the hands of mothers (as opposed to their husbands) benefits children. Does this observation imply that targeting transfers to women is good economic policy? We develop a series of noncooperative family bargaining models to understand what kind of...

Persistent link: https://www.econbiz.de/10010278429

Optimal commodity taxation and redistribution within households

Bargain, Olivier; Donni, Olivier - 2011

Using a collective model of consumption, we characterize optimal commodity taxes aimed at targeting specific individuals within the household. The main message is that distortionary indirect taxation can circumvent the agency problem of the household. Essentially, taxation should discourage less...

Persistent link: https://www.econbiz.de/10010278460

Equilibrium wage and employment dynamics in a model of wage posting without commitment

Coles, Melvyn G.; Mortensen, Dale T. - 2011

A rich but tractable variant of the Burdett-Mortensen model of wage setting behavior is formulated and a dynamic market equilibrium solution to the model is defined and characterized. In the model, firms cannot commit to wage contracts. Instead, the Markov perfect equilibrium to the wage setting...

Persistent link: https://www.econbiz.de/10010278491

Managerial incentives and favoritism in promotion decisions: Theory and field evidence

Berger, Johannes; Herbertz, Claus; Sliwka, Dirk - 2011

This paper investigates the effects of managerial incentives on favoritism in promotion decisions. First, we theoretically show that favoritism leads to a lower quality of promotion decisions and in turn lower efforts. But the effect can be mitigated by pay-for-performance incentives for...

Persistent link: https://www.econbiz.de/10010278492

Beyond the DSGE straitjacket

Pesaran, Hashem; Smith, Ron P. - 2011

Academic macroeconomics and the research department of central banks have come to be dominated by Dynamic, Stochastic, General Equilibrium (DSGE) models based on micro-foundations of optimising representative agents with rational expectations. We argue that the dominance of this particular sort...

Persistent link: https://www.econbiz.de/10010278494

Risk, institutions and growth: Why England and not China?

Greif, Avner; Iyigun, Murat; Sasson, Diego - 2011

We analyze the role of risk-sharing institutions in transitions to modern economies. Transitions requires individual-level risk-taking in pursuing productivity-enhancing activities including using and developing new knowledge. Individual-level, idiosyncratic risk implies that distinct...

Persistent link: https://www.econbiz.de/10010278525

The impact of worker effort on public sentiment towards temporary migrants

Epstein, Gil S.; Venturini, Alessandra - 2011

Temporary and circular migration programs have been devised by many destination countries and supported by the European Commission as a policy to reduce welfare and social costs of immigration in destination countries. In this paper we present an additional reason for proposing temporary...

Persistent link: https://www.econbiz.de/10010278535

Consistency in organization (updated)

Schlicht, Ekkehart - 2011

modern compensation theory, but has not been extended to organization theory. The perspective sheds new light on several … topics in the theory of the firm, like the boundaries of the firm, the importance of fairness concerns within firms, the … attenuation of incentives, or the role of routines and incentives. It implies a perceptional theory of the firm that is realistic …

Persistent link: https://www.econbiz.de/10010278547