We apply the set-up of limited commitment model to empirically test the role of informal risk-sharing networks using panel data on informal credit transactions from rural Ethiopia. The empirical estimates provide convincing evidence for the belief that enforcement problem limits the direct role...

In an environment of strongly decreasing banana productivity, we analyse whether an increase in the average productivity of a reference group a farmer belongs to, has a positive effect on that individual farmer’s harvest. The increase in average productivity is supposedly caused by the...

The high volatility of electricity markets gives producers and retailers an incentive to hedge their exposure to electricity prices by buying and selling derivatives. This paper studies how welfare and investment incentives are affected when markets for derivatives are introduced, and to what...

A regression estimator is said to be robust if it is still reliable in the presence of outliers. On the other hand, its standard error is said to be robust if it is still reliable when the regression errors are autocorrelated and/or heteroskedastic. This paper shows how robust standard errors...

This paper deals with the question: How can one incorporate modern responsibility-catering egalitarianism into the economic theory on the measurement of income inequality? We first concisely describe what is meant by responsibility-sensitive egalitarianism and present a particular axiomatic...

We derive closed-form expressions for the optimal weighting matrix for GMM estimation of the stochastic volatility model with AR(1) log-volatility, and for the asymptotic covariance matrix of the resulting estimator. The moment conditions considered are generated by the absolute observations...

This paper analyzes the conduct of publicly owned monopolistic utilities regulated by a voluntary sunshine regulatory model (i.e. publication of the performances of utilities). In particular, we examine the behaviour of Dutch drinking water utilities before and after the introduction of the...

This paper analyzes a stylized theoretical framework to examine optimal portfolio selection in an international context with an explicit focus on the effect of the exchange rate. More specifically, we study how the elimination of the exchange rate induces shifts in the optimal international...

This paper clarifies an issue in the Hirshleifer and Rasmusen-Tsebelis controversy on the effects of penalties on crime: what is the effect of penalties if the transgression of law has a discrete nature and if the law enforcer cannot act as Stackelberg leader? We differentiate between technical...

Transport activity is inextricably linked with environmental damage. Economists traditionally urge policy makers to adopt pricing solutions, in particular taxes, to reduce environmental damage rather than quantity restrictions or standards. This chapter examines environmental pricing, defined...