We present a dynamic OLG model of educational signaling and inequality with missing credit markets. Agents are characterized by two sources of unobserved heterogeneity: ability and parental income, consistent with empirical evidence on returns to schooling. Both quantity and quality of human...

This paper addresses the question of how farmers displaced by acquisition of agricultural land for the purpose of industrialization ought to be compensated. Prior to acquisition, the farmers are leasing in land from a landlord, either a private owner or a local government. There are three sets...

It has been argued that estimating the spectral density function of a stationary stochastic process at the zero frequency (or the so-called long-run variance) is an illposed problem so that any estimate will have an infinite minimax risk (e.g., Pötscher 2002). Most often it is a nuisance...

Many economic decisions can be described as an option exercise or optimal stopping problem under uncertainty. Motivated by experimental evidence such ast he Ellsberg Paradox, we follow Knight (1921) and distinguish risk from uncertainty. To capture this distinction, we adopt the multiple-priors...

We provide an infinite-horizon model of a production economy with credit-driven stock- price bubbles, in which firms meet stochastic investment opportunities and face credit constraints. Capital is not only an input for production, but also serves as collateral. We show that bubbles on this...

This paper introduces endogenous fertility into a model of occupational choice, and studies its steady states. Three main results are obtained. First, despite the presence of both income and substitution eects in fertility choice, general equilibrium eects operating via endogenous wages in...

Partly in response to increased testing and accountability, states and districts have been raising the minimum school entry age, but existing studies show mixed results regarding the effects of entry age. These studies may be severely biased because they violate the monotonicity assumption...

We consider modeling and forecasting a variety of asset return volatility series by adding a random level shift component to the usual long-memory ARFIMA model. We propose a parametric state space model with an accompanying estimation and forecasting framework that combines long memory and level...

This paper studies gender interactions within hierarchical organizations using a large data set on the duration of Italian municipal governments elected between 1993 and 2003. A municipal government can be viewed as a hierarchy, whose stability over time depends on the degree of cooperation...

Individuals must often choose among discrete alternatives with imperfect informa- tion about their values. Before choosing, they may have an opportunity to study the options, but doing so is costly. This costly information acquisition creates new choices such as the number of and types of...