We find that high macroeconomic uncertainty is associated with greater accumulation of physical capital, despite a reduction in investment and valuations. To reconcile this puzzling evidence, we show that uncertainty predicts lower depreciation and utilization of existing capital, which...

We model an environment in which individuals prefer to be in a space in which their rank is higher, be it a social space, a geographical space, a work environment, or any other comparison sphere which we refer to in this paper, and without loss of generality, as a region. When the individuals...

We develop a quantitative framework in which income inequality arises endogenously in response to productivity shocks. The framework accommodates sectoral inputoutput linkages, arbitrary elasticities of factors and intermediates, and heterogeneous workers that endogenously choose to supply their...

This article summarises the results of a study on the Germany energy crisis and the need for an extension and modificationsof the electricity price break. The study shows that the energy crisis led to a short-run output loss comparable to the output losses as-sociated with the COVID-19 crisis in...

Many consumers care about climate change and other externalities associated with their purchases. We analyze the behavior and market effects of such "socially responsible consumers" in three parts. First, we develop a flexible theoretical framework to study competitive equilibria with rational...

We model an environment in which individuals prefer to be in a space in which their rank is higher, be it a social space, a geographical space, a work environment, or any other comparison sphere which we refer to in this paper, and without loss of generality, as a region. When the individuals...

In oligopoly models with differentiated products, producers face a market demand function that reflects the preferences of consumers. However, typical assumptions on preferences place only weak restrictions on the shape of aggregate demand. This may result in profit functions that are not...

A stumbling block in the modelling of competitive markets with commodity and price spaces of infinite dimensions, arises from having positive cones with an empty interior. This issue precludes the use of tools of differential analysis, ranging from the definition of a derivative, to the use of...

We study the problem of assigning indivisible goods to individuals where each is to receive one object. To guarantee fairness in the absence of monetary compensation, we consider random assignments and analyse various equity criteria for such lotteries. In particular, we find that sd-no-envy (as...

This paper analyzes within a two-region endogenous growth model how different types of public policies affect the equilibrium spatial distribution of economic activity. Integration is modeled as a continuum and enables firms to access the public input of the respective other region. Given a...