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Uncertain Demand, Consumer Loss Aversion, and Flat-Rate Tariffs

Herweg, Fabian - 2010

The so called flat-rate bias is a well documented phenomenon caused by consumers' desire to be insured against fluctuations in their billing amounts. This paper shows that expectation-based loss aversion provides a formal explanation for this bias. We solve for the optimal two-part tariff when...

Persistent link: https://www.econbiz.de/10010270418

Market Structure and Matching with Contracts

Westkamp, Alexander - 2010

Ostrovsky [10] develops a theory of stability for a model of matching in exogenously given networks. For this model a …

Persistent link: https://www.econbiz.de/10010270419

Price Discrimination in Input Markets: Downstream Entry and Welfare

Herweg, Fabian; Müller, Daniel - 2010

The extant theory on price discrimination in input markets takes the structure of the intermediate industry as …

Persistent link: https://www.econbiz.de/10010270421

Risk in a Simple Temporal Framework for Expected Utility Theory and for SKAT, the Stages of Knowledge Ahead Theory

Pope, Robin; Selten, Reinhard - 2009

The paper re-expresses arguments against the normative validity of expected utility theory in Robin Pope (1983, 1991a … essential uniqueness property in the context of temporal and atemporal expected utility theory and a proof of the absence of a … limit property natural in an axiomatised approach to temporal expected utility theory. Problems of the time structure of …

Persistent link: https://www.econbiz.de/10010270422

Heterogeneous consumers, segmented asset markets, and the effects of monetary policy

Enders, Zeno - 2010

This paper examines the implications of segmented assets markets for the real and nominal effects of monetary policy. I develop a model, in which varieties of consumption bundles are purchased sequentially. Newly injected money thus disseminates slowly through the economy via second-round...

Persistent link: https://www.econbiz.de/10010270424

The Uncertain Mortality Intensity Framework: Pricing and Hedging Unit-Linked Life Insurance Contracts

Li, Jing; Szimayer, Alexander - 2010

We study the valuation and hedging of unit-linked life insurance contracts in a setting where mortality intensity is governed by a stochastic process. We focus on model risk arising from different specifications for the mortality intensity. To do so we assume that the mortality intensity is...

Persistent link: https://www.econbiz.de/10010270425

Shutdown Contests in Multi-Plant Firms and Governmental Intervention

Kräkel, Matthias - 2010

When a multi-plant firm must close one unit due to declining demand it can choose between two alternatives. On the one hand, the firm can announce a certain span of time in which the plants are evaluated according to relative performance with the least performing plant being shut down in the end...

Persistent link: https://www.econbiz.de/10010270427

On Horns and Halos: Confirmation Bias and Job Rotation

Müller, Daniel - 2010

Confirmation bias, which refers to unintentional and unknowing selectivity in the use of evidence, belongs to the major problems faced by organizations. In this article, we discuss job rotation as a natural solution to this problem. In a nutshell, adopting job rotation provides an organization...

Persistent link: https://www.econbiz.de/10010270428

Ambiguous act equilibria

Bade, Sophie - 2010

A game-theoretic framework that allows for explicitly randomized strategies is used to study the e ect of ambiguity aversion on equilibrium outcomes. The notions of 'independent strategies' as well as of 'common priors' are amended to render them applicable to games in which players lack...

Persistent link: https://www.econbiz.de/10010270432

The Pareto-frontier in a simple Mirrleesian model of income taxation

Bierbrauer, Felix; Boyer, Pierre C. - 2010

We characterize the Pareto-frontier in a simple Mirrleesian model of income taxation. We show how the second-best frontier which incorporates incentive constraints due to private information on productive abilities relates to the first-best frontier which takes only resource constraints into...

Persistent link: https://www.econbiz.de/10010270434