Should the constitution of a federation allow for peaceful secession? Constitutionally defined secession rules are optimal ex post if the federation breaks down. However, they may be suboptimal ex ante if the member countries receive a benefit from the perceived long-term stability of the...

We analyze the rational expectation equilibria of a delegated portfolio management model in which two risky assets have completely independent returns and liquidity shocks. Some managers have perfect information on the assets' returns while others are uninformed and try to infer information from...

Should the constitution of a federation allow for peaceful secession? Constitutionally defined secession rules are optimal ex post if the federation breaks down. However, they may be suboptimal ex ante if the member countries receive a benefit from the perceived long-term stability of the...

I study the general problem of a principal who desires to implement a given vector of actions and pay the agents according to a given compensation scheme. Previous work has provided mechanisms for implementation in various special cases. In this article, I fully characterize the set of action...

We consider the Hotelling-Downs model with n ≥ 2 office seeking candidates and runoff voting. We show that Nash equilibria in pure strategies always exist and that there are typically multiple equilibria, both convergent (all candidates are located at the median) and divergent (candidates...

We study the implementation problem for exchange economies when agents can renegotiate the outcome assigned by the planner and can collude. We focus on the use of sequential mechanisms and present a simple sufficient condition for implementation with renegotiation in strong perfect equilibrium....

Carbon allowance auctions are a component of existing and proposed regional cap-and-trade programs in the United States and are also included in recent proposed bills in the U.S. Congress that would establish a national cap-and-trade program to regulate greenhouse gases ("carbon"). We discuss...