I study the design of environmental policies for a regulator that has incomplete information on firms’ emissions and costs of production and abatement (e.g., air pollution in cities with numerous small polluting sources). Because of incomplete information on emissions, there is no policy that...

Chile has pioneered the implementation of emission offseting programs pursuing simultaneously economic growth and environmental protection. In this paper, emission trading programs implemented in Santiago of Chile are analyzed and its relevance for developing countries is evaluated. It is argued...

Many firms face a dynamic trade-off: if price is reduced, the firm attracts new customers who will yield profits in the future, but it also forgoes the opportunity to squeeze profits now from loyal customers. This paper identifies a rule that represents the optimal resolution of this trade-off,...

In this paper we study the effect of NAFTA on the responsiveness of the Mexican economy to real exchange rate shocks. We argue that, by opening the U.S. and Canadian markets to Mexican goods, NAFTA made it easier for domestic producers to take advantage of the opportunities brought by the...

Este trabajo compara modelos de inestabilidad financiera de naturaleza estadística y basados en la teoría de opciones, para el conjunto de sociedades anónimas abiertas chilenas. Los modelos estadísticos tienen un ajuste adecuado, aunque la peculiar historia de las quiebras en el período...

This paper studies firms’ incentives to invest in environmental R&D under different market structures (Cournot and Bertrand) and environmental policy instruments (emission standards, taxes, tradeable permits and auctioned permits). Because of market strategic effects, R&D incentives vary...

Risk-averse individuals wish that assets concentrate their payoffs in states of high marginal value (that is, highly likely or low endowment states). An asset or portfolio may fail to do so, by having payoffs uncorrelated to its owner needs or, even worse, by having them inversely related. The...