In higher education, pure credit market funding leads to underinvestment due to insufficient risk pooling, while pure income-contingent loan funding leads to overinvestment. We analyze whether funding diversity – a market structure in which credit markets coexist alongside income-contingent...

Over the past decades the college sectors in the higher education systems of many Western countries have expanded their capacities massively. This happened even though colleges have been at a competitive disadvantage with universities which are publicly subsidized, while colleges must...

This paper presents a model of a competitive exporting firm confronting multiple currency risks. Future markets do not exist for the firm's own currency, but do exist between currencies of two countries to which the firm exports its entire output. We provide analytical insight into optimal...

We consider an OLG economy with endogenous investment in human capital. Heterogeneity in individual human capital levels is generated by random innate ability. The production of human capital depends on each individual’s investment in education. This investment decision is taken only after...

This paper uses the framework of an OLG economy for an analysis of the dynamic interaction between the precision of information about individual skills, investment in education, human capital accumulation, and social welfare. The human capital of an individual depends on both his (subjectively)...

We analyze the importance of information about individual skills for understanding economic growth and income inequality. The paper uses the framework of an OLG economy with endogenous investment in human capital. Agents in each generation differ by random individual ability, or talent, which...

The narrow applicability of Blackwell's result that "more information" is desirable, lies in the fact in economic models once a signal is observed by all economic agents their opportunity sets may vary. We show that Blackwell's theorem does not hold when the feasible set of actions is...