We study all-pay contests with an exogenous minimal effort constraint where a player can participate in a contest only if his effort (output) is equal to or higher than the minimal effort constraint. Contestants are privately informed about a parameter (ability) that affects their cost of...

One of the more efficient methods to hedge portfolios of securities whose put options are not traded is to use stock index options. We use the mean-extended Gini (MEG) model to derive the optimal hedge ratios for stock index options. We calculate the minimum-variance hedge ratios and compare...

We study a three-stage all-pay auction with two players in which the ?rst player to win two matches wins the best-of-three all-pay auction. The players have values of winning the contest and may have also values of losing, the latter depending on the stage in which the contest is decided. It is...

This paper studies the role of education as a way of reducing private rent seeking activities and increasing output. In many underdeveloped economies, for most individuals, there is no private return to education. Nonetheless, according to this paper, governments are better off by investing in...

Yitzhaki (1996) showed that the OLS estimator of the slope coefficient in a simple regression is a weighted average of the slopes delineated by adjacent observations. The weights depend only on the distribution of the independent variable. In this paper I demonstrate that equal weights can only...

We consider cooperative environments with externalities (games in partition function form) and provide a recursive definition of dividends for each coalition and any partition of the players it belongs to. We show that with this definition and equal sharing of these dividends the averaged sum of...

The literature on agglomeration has focused largely on primary agglomeration caused by direct attraction effects. Here we focus on secondary and tertiary agglomerations caused by a primary agglomeration. Initially, scale economies in the provision of club goods (CGs) lead each CG to agglomerate...

This paper revisits the defence-growth nexus for the rivals of the Israeli-Arab conflict over the last four decades. To this end, we utilize the Toda and Yamamoto (1995) causality test and the generalized variance decomposition. Contrary to the conventional wisdom and many earlier studies, we...

We show that the value of a zero-sum Bayesian game is a Lipschitz continuous function of the players?common prior belief, with respect to the total variation metric (that induces the topology of setwise convergence on beliefs). This is unlike the case of general Bayesian games, where lower...

A network market is a market in which the benefit each consumer derives from a good is an increasing function of the number of consumers who own the same or similar goods. A major obstacle that plagues the introduction of a network good is the ability to reach critical mass, namely, the minimum...