Do elementary statistics or equilibrium theory deliver any rules of thumb regarding how we should argue in debates? We suggest a framework for normative analysis of debates. In our framework, each discussant wants the audience to believe that the actual state coincides with the discussant's...

This paper considers the relationship between congruence and encompassing. Congruence is defined formally, and though it is not testable directly, it can be tested indirectly via tests of misspecification. Empirically more than one model can appear congruent, but that which encompasses its...

Does a competitive equilibrium in a matching market provide adequate incentives for investments made before the market when utility is not perfectly transferable? This paper derives a necessary and sufficient condition for equilibrium investments to maximize surplus conditional on the matching...

We report results from a sender-receiver cheap talk game, which explores whether an individual's decision to deceive is influenced by a concern for relative standing in a reference group. We show theoretically that positively biased senders, who think they are higher in the deception...

A committee is choosing from two alternatives. If required supermajority is not reached, voting is repeated indefinitely, although there is a cost of delay. Under suitable assumptions the equilibrium analysis provides a sharp prediction. The result can be interpreted as a generalization of the...

We investigate experimentally the impact of cognitive and affective empathy on behavior. A novelty of the study is that we do so directly without invoking responses to questionnaires, but by manipulating the state of hunger of participants in the single-shot Dictator game during the holy month...

We introduce a method for detecting the presence of time variation and instabilities in the parameters of predictive regressions linking noisy variables such as stock returns to highly persistent predictors such as stock market valuation ratios. Our proposed approach relies on the least squares...

We develop tests for detecting possibly episodic predictability induced by a persistent predictor. Our framework is that of a predictive regression model with threshold effects and our goal is to develop operational and easily implementable inferences when one does not wish to impose a priori...

Ordinary least squares (OLS) is well-known to produce an inconsistent estimator of the spatial parameter in pure spatial autoregression (SAR). This paper explores the potential of indirect inference to correct the inconsistency of OLS. Under broad conditions, it is shown that indirect inference...

The design and evaluation of environmental policy requires the incorporation of time and risk elements as many environmental outcomes extend over long time periods and involve a large degree of uncertainty. Understanding how individuals discount and evaluate risks with respect to environmental...