This paper examines the economic and political conditions that influence people’s attitudes regarding a municipality break-up. The theoretical model predicts intra-municipal differences in tax bases, political preferences, and population size to affect the expected gain from secession. The...

This paper examines the concern for relative standing among rural households in China. We use a survey-experimental method to measure to what extent poor Chinese farmers care about their relative income and find that the respondents care to a high degree. Compared to previous studies in...

Between 1997 and 2005, 5.2 billion USD were invested to reduce cocaine production in Colombia, the world’s main cocaine producer. However, little is known about the effectiveness of policies targeting coca cultivation, this paper evaluates the effects of the two main policies: eradication and...

Risk matters when corporate debt has a positive probability of default. Lenders have traditionally used covenants to protect their property rights because the financing and operating decisions of firms can reduce the value of the firm’s outstanding debt. We examine the use of captive finance...

The purpose of this paper is to trace partisan differences among Swedish governments during the period 1958-1998. According to the Partisan Theory of macroeconomic policy left-wing governments are relatively more concerned with the performance of the real side of the economy (real output and...

his paper analyzes the effects of the choice between price-based and quantity-based emission regulations on compliance incentives and social welfare in the presence of incomplete enforcement and technology adoption. We show that in contrast to taxes, the extent of violations under tradable...

Should governments allow parallel trade of pharmaceuticals? There is no clear-cut answer to this question, since parallel trade causes some public concerns. One is that prices might not decrease much in the home country because consumers are price insensitive as a result of medical insurance....

The conventional rational voter model has problems explaining why people vote, since the costs typically exceed the expected benefits. This paper presents Swedish survey evidence suggesting that people vote based on a combination of instrumental and expressive motives, and that people are...

This paper revisits old questions of the proper subject and bounds of economics: Does economics study “provisioning”? or markets? or a method of reasoning, self-interested rational optimization? A variety of scholars and others in many fields make use of a taxonomy of society consisting of...

Since its first appearance in the late 1800s, the origins of the Sicilian mafia have remained a largely unresolved mystery. Both institutional and historical explanations have been proposed in the literature through the years. In this paper, we develop an argument for a market structure...