This paper demonstrates that plausible cost-based explanations exist for what are commonly perceived to be cases of price discrimination. The authors explain such commonly discussed problems as the price spreads of retail gasoline products, the "high" price of dinners at restaurants, the "high"...

This paper examines how the size of an efficient subsidy varies with the amount of freeriding and the presence of distorting taxation. Ironically, the existence of free-riding, where some individuals make no voluntary contribution at all, reduces the size of an efficient subsidy and makes a...

Public goods can be financed by direct taxation or a subsidy to private spending. This paper examines the relative efficiency and distributional consequences of the two methods. Efficiency is shown to depend on the price elasticity of private spending and the trade- off between public and...

Two insurance experiments using real-money consequences and multiple rounds to provide experience are described. In the first experiment, subjects bid for insurance to prevent a fixed loss of $4 at probabilities ranging from .01 to .9. Mean bids were near expected value except at the lowest...