Two results showing the limitations of the “as if” methodology are proved under relatively mild assumptions. In an interpretation of the results, a competitive market cannot simulate the outcome of a market M in which the single price assumption does not hold. In a second interpretation, the...

Much attention has been paid to alternative fuel sources of late. Ethanol has been a politically popular alternative fuel additive and has recently been pushed to the forefront as a leading replacement to MTBE as an oxygenate. This paper examines the potential markets for ethanol, including...

External agents are frequently characterized as necessary for efficiency in team production settings. At the same time, these agents must be constrained from opportunistically exercising their enforcement capabilities. I argue that collective action costs and formal institutions (e.g., golden...

This paper analyzes a simple, repeated game of simultaneous entry and pricing. We report a surprising property of the symmetric equilibrium solution: If the number of potential competitors is increased above two, the market breaks down with higher probability, and the competitive outcome becomes...

Received evidence suggests that changes in appointer- and overseer- preferences influence monetary policy (i.e., partisan heritage matters). Evidence presented here, on the other hand, is consistent with changes in the cost of pursuing a common preference influencing policy. I draw this evidence...

Recent models of procrastination due to self-control problems assume that a procrastinator considers just one option and is unaware of her self-control problems. We develop a model where a person chooses from a menu of options and is partially aware of her self-control problems. This menu model...

We model knowledge-trading coalitions in which the transfer of tacit knowledge is unverifiable and requires face-to-face contact, making spatial proximity important. When there are sufficient “complementarities” in knowledge exchange, successful exchange is facilitated if firms can meet in a...

Recent work suggest that Cournot oligopolists competing in a spatial model, with uniform distribution of consumers, agglomerate at the center of the market. This paper analyzes the robustness of this result with a general symmetric distribution of consumers.

This paper discusses the economics of academic journal publishing. It presents data on pricing of journals to libraries by non-profit and commercial publishers. It advocates the view that scholars should refrain from doing free refereeing for overpriced journals.

Clearinghouse models of online pricing---such as Varian (1980), Rosenthal (1980), Narasimhan (1988), and Baye-Morgan (2001)---view a price comparison site as an 'information clearinghouse' where shoppers and loyals obtain price and product information to make online purchases. These models...