In a finite-horizon general equilibrium model national income is the value of output at supporting prices and a perturbation increases welfare if and only if it raises national income. National income therefore serves as both a welfare measure and a cost-benefit criterion. We construct a measure...

Software patch management has now assumed tremendous significance and it directly affects the customer opinion about the quality and security of the released product. Hence, software vendors are forced to put in substantial amount of effort for servicing released products, and maintain a fairly...

Energy and climate policies are usually seen as measures to internalize externalities. However, as a side effect, these policies redistribute wealth between consumers and producers, and within these groups. While redistribution is seldom the focus of the academic literature in energy economics,...

Increasing shares of wind and solar generation serve to decarbonize electricity generation; however, their temporal and spatial variability poses challenges in grid operation. While grid expansion is restricted in the medium term, storage technologies can potentially increase the power...

We study a class of optimization problems involving linked recursive preferences in a continuous-time Brownian setting. Such links can arise when preferences depend directly on the level or volatility of wealth, in principal-agent (optimal compensation) problems with moral hazard, and when the...

Public health experts caution that global warming increases the likelihood of novel coronaviruses and amplifies their impacts. Such contagions are virtually unique in their ability to inflict catastrophic worldwide harm. Even more alarming is the forecast that future coronavirus pandemics will...

We consider convertible bonds that contractually stipulate payment standstill, contingent on a market indicator of a sovereign's creditworthiness breaching a distress threshold. This financial innovation limits ex-ante the likelihood of debt crises and imposes ex-post risk sharing between...

We model the super-replication of payoffs linked to a country's GDP as a stochastic linear program on a discrete time and state-space scenario tree to price GDP-linked bonds. As a byproduct of the model, we obtain a hedging portfolio. Using linear programming duality we also compute the risk...

This paper assesses the environmental and economic efficiency of thermal plants operating on fossil fuels in Pakistan using methods based on data envelopment analysis. Using the material balance principle, we find that cost- and carbon-efficient points can only be obtained simultaneously by...