How should a government arrange taxes on labour and capital over time? To provide an answer, we develop the field of optimal dynamic taxation further by (i) incorporating indivisible labour and (ii) analysing the short-run dynamics of the capital and labour taxes under the second-best programme....

We study manipulability of multi-valued solutions in fair allocation of homogeneous indivisible objects with monetary transfers. We show that the no-envy solution satisfies some extension of strategy-proofness to multi-valued solutions. Since no-envy implies Pareto efficiency in this literature,...

In this paper we consider a model, where at most one object is allocated to each individual, with no two individuals sharing one or more objects, and possibly some allocations being defined infeasible. We propose a weaker sufficient condition than the one suggested by Herreiner and Puppe (2002)...

Consider the following situation. There are two parties, a buyer who is interested in one unit of a specific good, and a seller who can produce this good for the buyer. While producing the good, the seller can exert more or less unobservable effort (hidden action). When the buyer sees the...

A buyer and a seller can exchange one unit of an indivisible good. While producing the good, the seller can exert unobservable effort (hidden action). Then the buyer realizes whether his valuation is high or low, which stochastically depends upon the seller's effort level (hidden information)....

We present a survey of the emerging literature on the design of matching markets. We survey the articles on discrete resource allocation problems, their solutions, and their applications in three related domains. The first domain gives the theoretical background regarding the basic models,...

The analysis of this volume represents an attempt to apply modern mathematical techniques to the problems arising from large and significant indivisibilities. While the classical microeconomic theory refers to assumptions about the convexity of production sets and consumer preferences, this book...