We compare the performance of liability rules for managing environmental disasters when third parties are harmed and cannot always be compensated. A firm can invest in safety to reduce the likelihood of accidents. The firm's investment is unobservable to authorities. Externality and asymmetric...

In the market where inattentive buyers can fail to notice some feasible choices, the key role of marketing is to make buyers aware of products. However, the eective marketing strategy is often subtle since marketing tactics can make buyers cautious. This paper provides a framework to analyze an...

We define and experimentally test a public provision mechanism that meets three basic ethical requirements and allows community members to influence, via monetary bids, which of several projects is implemented. For each project, participants are assigned personal values, which can be positive or...

The determinants of risk attitude in couples are explored using data from the German Socio-Economic Panel over the period 2004 to 2009. The focus of the analysis is the repeated responses to the survey question about general willingness to take risk. Responses to this question are provided on a...

Recent empirical contributions emphasize the importance of (potential) market size for the development of new pharmaceuticals. At the same time many scholars point out the importance of of scientific advances for the industry's R&D activities. Against this background I analyze the relationship...

Piracy in international waters is on the rise again, in particular off the coast of Somalia. While the dynamic game between pirates, ship-owners, insurance firms and the military seems to have reached some kind of equilibrium, piracy risks generating significant negative externalities to third...

One of the top priorities to improve the European Union's growth performance is the creation ofsingle market for services. The directive on services adopted by the Parliament and the Council by the end of 2006 aims at removing barriers to the free movement of service providers on the internal...

This paper experimentally investigates the effect of limits on campaign spending and outcome in an electoral contest where two candidates, an incumbent and a challenger, compete for office in terms of the amount of campaign expenditure. The candidates are asymmetric only in that the incumbent...

This paper addresses the question of whether government procurement can work as a de facto innovation policy tool. We develop an endogenous growth model with quality-improving innovation that incorporates industries with heterogeneous innovation sizes. Government demand in high-tech industries...

In a series of one-shot linear public goods game, we ask subjects to report their contributions, their contribution plans for the next period, and their first-order beliefs about their present and future partner. We estimate subjects' preferences from plans data by a finite mixture approach and...