This paper analyzes firm incentives to diffuse and adopt advanced abatement technology for three different regimes of tradeable emission permits (auctioning, benchmarking, and grandfathering). We particularly consider technical change that decreases marginal abatement costs (MACs) only at high...

This paper analyzes liability rules when consumers and third parties/the environment incur harm. Expected harm is convex in the level of output and modeled as a power function. We show that the social ranking of liability rules previously established for the case in which only consumers suffer...

This paper shows that the provision of consumer rights can decrease welfare when some consumers remain ignorant of these rights. We find that consumers uninformed about a mandated warranty demand excessively safe products in some circumstances. In other circumstances, uninformed consumers buy...

This paper tests the conjecture that involuntary job loss erodes trust. Using the German Socio-Economic Panel and considering how trust evolves over a quinquennial time interval, we find that job loss decreases trust by about 9 percent of a standard deviation.

This paper analyzes liability rules when consumers and third parties/the environment incur harm. Expected harm is convex in the level of output and modeled as a power function. We show that the social ranking of liability rules previously established for the case in which only consumers suffer...

Moral rules and social norms influence whether individuals break the law. We characterize optimal law enforcement when some individuals obey internalized moral rules and implement social norms for other individuals who prefer to comply with them. Moral individuals and norm followers are linked...

This paper analyzes the principal-agent relationship between a plaintiff and his or her lawyer when the lawyer's investment in discovery is private information. The plaintiff uses the level of the contingency fee and potentially also restrictions on settlements to guide the lawyer's...

This paper explores the relationship between the intensity of competition in product markets and firms' incentives to lower their production costs by illegal means. Our framework combines a Salop circle with a crime model la Becker, allowing us to differentiate between several measures for the...

This paper presents detailed evidence about who compares to whom in terms of relative income. We rely on representative survey data on the importance of income comparisons vis-á-vis seven reference groups, allowing us to exploit within-subject heterogeneity. We explore the prevalence and...

This paper presents detailed evidence about who compares to whom in terms of relative income. We rely on representative survey data on the importance of income comparisons vis-a-vis seven reference groups, allowing us to exploit within-subject heterogeneity. We explore the prevalence and...