The project aims to achieve two objectives. First, we are analysing the labour market implications of the assumption that firms cannot pay similarly qualified employees differently according to when they joined the firm. For example, if the general situation for workers improves, a firm that...

A theoretical model is developed in that both buybacks and the adoption of an IMF program can be used as screening devices that enable a creditor to discriminate between debtor countries that are willing to use debt relief in order to invest and repay and countries that are not. Asymmetric...

This paper studies insurance arrangements in village economies when there is complete information but limited commitment. Commitment is limited because only limited penalties can be imposed on households which renege on their promises. Any efficient insurance arrangements must therefore take...

either above or below the efficient level and that actions and the division of the surplus converges to a stationary solution at which either both investment levels are efficient or both are below the efficient level.

This paper analyses a model of private unemployment insurance under limited commitment and a model of public unemployment insurance subject to moral hazard in an economy with a continuum of agents and an infinite time horizon. The dynamic and steady-state properties of the private unemployment...

We show that, in repeated common interest games without discounting, strong "perturbation implies efficiency" results require that the perturbations must include strategies that are "draconian" in the sense that they are prepared to punish to the maximum extent possible. Moreover, there is a...

Two-person repeated games with no discounting are considered where there is uncertainty about the type of the players. If there is a possibility that a player is an automaton committed to a particular pure or mixed stage-game action, then this provides a lower bound on the Nash equilibrium...

Recent work on consumption allocations in village economies finds that idiosyncratic variation in consumption is systematically related to idiosyncratic variation in income, thus rejecting the hypothesis of full risk-pooling. We attempt to explain these observations by adding limited commitment...

This paper considers a long-term relationship between two risk averse agents who undertake joint investments. Agents have an opportunity to expropriate some of the joint benefit for their own use. The question asked is how to structure the investments and division of the surplus over time so as...