In a perfectly competitive market for annuities with full information, the price of annuities is equal to individuals (discounted) survival probabilities. That is, prices are actuarially fair. In contrast, the pricing implicit in social security systems invariably allows for cross subsidization...

The existence of a value and optimal strategies is proved for the class of twoperson repeated games where the state follows a Markov chain independently of players’ actions and at the beginning of each stage only player one is informed about the state. The results apply to the case of standard...

In this paper we study the social preferences obtained from monotone neutral social welfare functions for random individual preferences. It turns out that there are two extreme types of behavior. On one side, there are social welfare functions, such as the majority rule, that lead to stochastic...

The high cost of searching for employers borne by prospective employees increases friction in the labor market and inhibits formation of efficient employer-employee relationships. It is conventionally agreed that mechanisms that reduce the search costs (e.g., internet portals for job search)...

We conducted an experimental study of price competition in a duopolistic market. The market was operationalized as a repeated game between two “teams” with one, two, or three players in each team. Each player simultaneously demanded a price, and the team whose total asking price was smaller...

We embark on a systematic analysis of the power and limitations of iterative ascending-price combinatorial auctions. We prove a large number of results showing the boundaries of what can be achieved by different types of ascending auctions: item prices vs. bundle prices, anonymous prices vs....

We study an economic setting in which a principal motivates a team of strategic agents to exert costly effort toward the success of a joint project. The action taken by each agent is hidden and affects the (binary) outcome of the agent's individual task stochastically. A Boolean function, called...

Inequalities often persist because both the advantaged and the disadvantaged stand to lose from change. Despite the probability of loss, moral indignation can lead the disadvantaged to seek to alter the status quo, by encouraging them to sacrifice their material self-interest for the sake of...

It has been shown (Hart [2002]) that the backward induction (or subgame-perfect) equilibrium of a perfect information game is the unique stable outcome for dynamic models consisting of selection and mutation, when the mutation rate is low and the populations are large, under the assumption that...

Seeking advice is a basic practice in making real life decisions. Until recently, however, little attention has been given to it in either empirical studies or theories of decision making. The studies reported here investigate the influence of advice on judgment and the consequences of advice...