This paper shows that vertical fiscal inefficiencies impede federally organized countries in successfully attracting foreign direct investment. Such countries, particularly if characterized by weak institutions, are disadvantaged in the process of bidding for firms and in their ability to commit...

This article studies the explanatory power of intangible factors - such as country stereotypes and consumer perceptions - for the size of foreign direct investment (FDI) flows, controlling for fundamental variables. To operationalize the concept of these intangibles we use the idea of the...

We analyse bargaining over international climate agreements in a setting with incomplete information about abatement costs. Incomplete information is known as one of the key reasons why negotiations may fail more generally, and why efficiency gains cannot be exploited. We ask whether unilateral...

Where product innovation requires several complementary patents, fragmented property rights can limit firms' willingness to invest in R&D. We consider the research intensity in multiple simultaneous R & D contests and how it depends on whether firms already hold relevant patents as well as the...

We study the role of information exchange that may occur in alliances in a contest without noise. Contestants learn their own limits of what they can spend in a contest. They may also form alliances and learn the limits of all players who are within the same alliance. Then they decide...

Income disparities and the intra-family redistribution implied by a marriage may induce a high-income earner to abstain from marrying a low-income earner even though they would be a perfect match emotionally. Redistributive income taxation eases this problem, and the design of marriage matching...

The generic alliance game considers players in an alliance who fight against an external enemy. After victory, the alliance may break up, and its members may fight against each other over the spoils of the victory. Our experimental analysis of this game shows: In-group solidarity vanishes after...

If a small cost applies for learning the corporate tax rules in different countries, this can completely eliminate tax competition. This modified version of the Diamond paradox and can also explain the empirically observed tax cuts cum base broadening. © 2011 Elsevier B.V.

We characterize the equilibrium of the all-pay auction with general convex cost of effort and sequential effort choices. We consider a set of n players who are arbitrarily partitioned into a group of players who choose their efforts 'early' and a group of players who choose 'late'. Only the...