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Creative destruction and productive preemption

Norbäck, Pehr-Johan; Persson, Lars; Svensson, Roger - 2013

We develop a theory of innovation for entry and sale into oligopoly, and show that inventions of higher quality are …

Persistent link: https://www.econbiz.de/10010291511

Asset pricing with uncertain betas: A long-term perspective

Gollier, Christian - 2013

How should one evaluate investment projects whose CCAPM betas are uncertain? This question is particularly crucial for projects yielding long-lasting impacts on the economy, as is the case for example for many green investments. We define the notion of a certainty equivalent beta. We show that...

Persistent link: https://www.econbiz.de/10010291514

Hanging together or being hung separately: The strategic power of coalitions where bargaining occurs with incomplete information

Konrad, Kai A.; Cusack, Thomas R. - 2013

What is the strategic role of membership in an intergovernmental group with unanimity requirements if the group negotiates with an external player in a setting with incomplete information? Being in such a group has a strategic effect compared to negotiating as a stand-alone player and reduces...

Persistent link: https://www.econbiz.de/10010291516

An exponential class of dynamic binary choice panel data models with fixed effects

Al-Sadoon, Majid M.; Li, Tong; Pesaran, M. Hashem - 2012

This paper develops a model for dynamic binary choice panel data that allows for unobserved heterogeneity to be arbitrarily correlated with covariates. The model is of the exponential type. We derive moment conditions that enable us to eliminate the unobserved heterogeneity term and at the same...

Persistent link: https://www.econbiz.de/10010291517

Should tax policy favor high- or low-productivity firms?

Langenmayr, Dominika; Haufler, Andreas; Bauer, … - 2012

Heterogeneous firm productivity seems to provide an argument for governments to pursue 'pick-the-winner' strategies by subsidizing highly productive firms more, or taxing them less, than their less productive counterparts. We appraise this argument by studying the optimal choice of effective tax...

Persistent link: https://www.econbiz.de/10010291519

Regional implications of financial market development: Credit rationing, trade, and location

von Ehrlich, Maximilian; Seidel, Tobias - 2013

We develop a heterogeneous-firms model with trade in goods, labor mobility and credit constraints due to moral hazard. Mitigating financial frictions reduces the incentive of high-skilled workers to migrate to one region such that an unequal distribution of industrial activity becomes less...

Persistent link: https://www.econbiz.de/10010291520

Generalized propensity scores for multiple continuous treatment variables

Egger, Peter H.; von Ehrlich, Maximilian - 2013

This paper illustrates that the generalized propensity score method can easily be applied with multiple continuous endogenous treatment variables. Consistency proofs carry over straightforwardly to this general case, and the approach is shown to work well in finite samples with various...

Persistent link: https://www.econbiz.de/10010291531

Loss aversion and ex post inefficient renegotiation

Herweg, Fabian; Schmidt, Klaus M. - 2012

We propose a theory of ex post inefficient renegotiation that is based on loss aversion. When two parties write a long …-term contract that has to be renegotiated after the realization of the state of the world, they take the initial contract as a … renegotiated outcome sticky and materially inefficient. The theory has important implications for the optimal design of long …

Persistent link: https://www.econbiz.de/10010291533

Portability of social benefits and international trade in services: Some reflections

Valdés-Prieto, Salvador - 2013

In this fascinating new field, this paper offers some reflections on portability of social benefits, and tries to identify promising research topics. These reflections are organized in three sections. The first analyzes the channels that underpin the positive value of portability of social...

Persistent link: https://www.econbiz.de/10010291535

Market structure and the cost of capital

Arouri, Mohamed El Hedi; Rault, Christophe; Sova, Robert; … - 2013

We contribute to the finance literature in two main ways. First, we present a theoretical capital asset pricing model (CAPM) to price assets in different market structures. Second, we use our model to analyze whether when markets are partially segmented using the local or the global CAPM yields...

Persistent link: https://www.econbiz.de/10010291538