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Copula bivariate probit models: With an application to medical expenditures

Winkelmann, Rainer - 2011

The bivariate probit model is frequently used for estimating the effect of an endogenous binary regressor (the treatment) on a binary health outcome variable. This paper discusses simple modifications that maintain the probit assumption for the marginal distributions while introducing non-normal...

Persistent link: https://www.econbiz.de/10010316864

Modelling zero-inflated count data when exposure varies: With an application to sick leave

Baetschmann, Gregori; Winkelmann, Rainer - 2012

theory consistent way. The new model is used in an application to the effect of insurance generosity on the number of absent …

Persistent link: https://www.econbiz.de/10010316870

How do informal agreements and renegotiation shape contractual reference points?

Fehr, Ernst; Hart, Oliver; Zehnder, Christian - 2011

(2008)'s theory of contractual reference points. However, existing studies ignore realistic aspects of trading relationships … suggest refinements of the theory. In particular, we find that the availability of informal agreements and ex post …

Persistent link: https://www.econbiz.de/10010316871

Tastes, castes, and culture: The influence of society on preferences

Fehr, Ernst; Hoff, Karla - 2011

Economists have traditionally treated preferences as exogenously given. Preferences are assumed to be influenced by neither beliefs nor the constraints people face. As a consequence, changes in behaviour are explained exclusively in terms of changes in the set of feasible alternatives. Here we...

Persistent link: https://www.econbiz.de/10010316875

Identification and estimation of thresholds in the fixed effects ordered logit model

Baetschmann, Gregori - 2011

The paper proposes a new estimator for the fixed effects ordered logit model. In contrast to existing methods, the new procedure allows estimating the thresholds. The empirical relevance and simplicity of implementation is illustrated in an application to the effect of unemployment on life...

Persistent link: https://www.econbiz.de/10010316876

The French Great Depression: A business cycle accounting analysis

Bridji, Slim - 2012

Using the business cycle accounting framework [Chari V., P. Kehoe and E. McGrattan 2007. Business Cycle Accounting. Econometrica 75, 781-836.], this paper sheds new light on the French Great Depression. Frictions that reduce the efficiency with which factor inputs are used (efficiency wedge)...

Persistent link: https://www.econbiz.de/10010316878

Communication & competition

Goeree, Jacob K.; Zhang, Jingjing - 2012

Charness and Dufwenberg (American Economic Review, June 2011, 1211-1237) have recently demonstrated that cheap-talk communication raises efficiency in bilateral contracting situations with adverse selection. We replicate their finding and check its robustness by introducing competition between...

Persistent link: https://www.econbiz.de/10010316885

Stabilizing the economy: Market design and general equilibrium

Goeree, Jacob K.; Lindsay, Luke - 2012

Review, 1960). Tatonnement theory predicts that prices are globally unstable for this economy, i.e. unless prices start at … the competitive equilibrium they oscillate without converging. Anderson et al. (Journal of Economic Theory, 2004) report … convergence. We replicate their experiments and confirm that tatonnement theory predicts the direction of price changes remarkably …

Persistent link: https://www.econbiz.de/10010316891

A geometric approach to mechanism design

Goeree, Jacob K.; Kushnir, Alexey - 2011

theory. The optimal mechanism can subsequently be derived from the support function using Hotelling's lemma. We first assume …

Persistent link: https://www.econbiz.de/10010316902

On the equivalence of Bayesian and dominant strategy implementation in a general class of social choice problems

Goeree, Jacob K.; Kushnir, Alexey - 2011

We consider a standard social choice environment with linear utilities and independent, one-dimensional, private values. We provide a short and constructive proof that for any Bayesian incentive compatible mechanism there exists an equivalent dominant strategy incentive compatible mechanism that...

Persistent link: https://www.econbiz.de/10010316903