We ask when firms with increasing returns can cover their costs independently by charging two-part tariffs (TPT's)---a condition we call independent viability. To answer, we develop notions of substitutability and complementarity that account for the total value of goods and use them to find the...

We estimate auto accident externalities (more specifically insurance externalities) using panel data on state-average insurance premiums and loss costs. Externalities appear to be substantial in traffic dense states: in California, for example, we find that a typical additional driver increases...

In games with strict strategic complementarities, properly mixed Nash equilibria - equilibria that are not in pure strategies - are unstable for broad class of learning dynamics.

The bias of forward exchange rates as a predictor of future spot rates is typically explained or decomposed as (1) a risk premium and (2) a convexity term which accounts for the fact that, when there is stochastic inflation, nominal gains from forward currency speculation are higher than real...