The authors study investment decisions in a farmers' cooperative. Farmers sell their products through the cooperative. Before production takes place, the cooperative has to decide on an investment. The authors study whether voting on investment leads to efficient investment decisions. The answer...

A multisectoral temporary general equilibrium macro model with wage bargaining is presented. In each sector agents are divided into capitalists and workers. The markets for produced goods and money are competitive, but the wage rate in a sector is determined by negotiation between an employers'...

We study the consequences of imperfect competition in a macro model with only one imperfection; that of labor market competition. Otherwise the model is ‘clean’; agents are optimizers, prices are endogenous, and expectations are rational. We show that, although imperfect competition in...

We study a model with free migration between a rich and a poor region. Since there is congestion, the rich region has an incentive to give the poor region a transfer in order to reduce immigration. Faced with free migration, the rich region voluntarily chooses a transfer, which turns out to be...

An infinitely repeated monetary policy game a la R. Barro and D. Gordon (1983) is considered. Before the game starts the government announces a policy rule. If there is a slight probability that government is honest and a slight probability that the government makes mistakes, then a sufficiently...

This paper studies the typical European system for public funding of parties, where parties receive public funds depending on their vote share. These funds finance electoral campaigns. It is shown that such a funding system increases policy convergence. The effect is larger, the more funding...

We analyze a model where local public debt levels are set by politicians who are chosen in local elections. Migration causes an externality across districts, and leads to overaccumulation of local public debt. Since debt is a strategic substitute, the median voters in each district prefer...