Consider a world with two people, 1 and 2, where person 1 (the proposer) may offer to help person 2 (the responder). The proposer may be altruistic towards the responder either out of a genuine desire to make her happy or out of guilt. The responder derives disutility from apparent acts of...

Richer and more educated citizens demand better governance than poorer citizens. They participate more in the political process, are more difficult to buy off, and tend to have the financial resources to support a revolt. An autocrat who is politically insecure may therefore not invest in...

The paper presents a theoretical and empirical analysis of a donor’s choice of the composition of unrestricted and in-kind/restricted transfers to a recipient and how this composition is adjusted in response to changes in the moral hazard behavior of the recipient. In-kind or restricted...

I present a two-player nested contest which is a convex combination of two widely studied contests: the Tullock (lottery) contest and the all-pay auction. A Nash equilibrium exists for all parameters of the nested contest. If and only if the contest is sufficiently asymmetric, then there is an...

We consider a two-stage contest in which players choose destructive efforts (sabotage) in stage 1 and productive efforts in stage 2. When the value of the prize is sufficiently high, we find that the productive effort of the contestants is independent of the value but their destructive effort is...

The author makes a pedagogical contribution to optimal income taxation. Using a very simple model adapted from George A. Akerlof (1978), he demonstrates a key result in the approach to public economics and welfare economics pioneered by Nobel laureate James Mirrlees. He shows how incomplete...

Suppose you are invited to a party, movie, dinner, etc not because your company is desired but because the inviter would feel guilty if she did not invite you. Furthermore, suppose the inviter extends an insincere invitation hoping that you will reject it and thereby assuage his guilt. I...