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William S. Vickrey
(Department of Economics, 2005)
Entry for William Vickrey, prepared for the Dictionary of Scientific Biography.
Low-Income and Welfare Client Priorities: Patterns of Earnings and Welfare Receipt for Workforce Investment Act Participants
(Department of Economics, 2003)
This paper examines labor market and welfare experiences of participants in Workforce Investment Act (WIA) programs who exited in July 2000-June 2001. Administrative data from six states on earnings and welfare receipt are used to trace...
Brand Familiarity and Product Knowledge in Customization
(Department of Economics, 2009)
This paper challenges the assumption commonly used in the theoretical literature
on customization that consumers always get their ideal varieties when they purchase a customized product. The author adopts Hotelling's ...
Supply Constraints and Housing Prices
(Department of Economics, 2006)
This paper analyzes the effects of land use constraints on housing prices. We provide a new framework for evaluating policy when mobility across regions is allowed but limited. A key result is that loosening regulatory constraints within individual...
Income and Substitution Effects of Increases in Risk when Payoffs are Linear in the Random Variable
(Department of Economics, 2000)
attention in the literature. This paper provides a Hicks-Slutsky decomposition of the effect of Rothschild-Stiglitz increases in risk on the optimal decision. Two measures of aversion to additional risk are introduced. Their behavior is shown to control...
The Precautionary Premium and the Risk-Downside Risk Tradeoff
(Department of Economics, 2002)
This paper shows that the precautionary premium embodies a tradeoff between risk and downside risk. It is the size of a mean-preserving spread for thish the strength of aversion to risk just offsets the strength of aversion to downside risk. Using...
Information Variability Impacts in Auctions
(Department of Economics, 2009)
A wide variety of auction models exhibit close relationships between the winner's expected profit and the expected difference between the highest and second-highest order statistics of bidders' information, and between ...
Customization: Ideal Varieties, Product Uniqueness and Price Competition
(Department of Economics, 2009)
We study customization in the Hotelling model with two firms. In addition to providing ideal varieties, the perceived uniqueness of a customized product contributes independently to consumer utility. We show that only when ...
Testing the Bounds: Empirical Behavior of Target Zone Fundamentals
(Department of Economics, 2009)
Standard target zone exchange rate models are based on nonlinear functions of an unobserved economic fundamental, which is assumed to be bounded, similarly to the target zone exchange rates themselves. A violation of this key assumption is a basic...
Does a Seller Really Want Another Bidder?
(Department of Economics, 2007)
Jeremy I. Bulow and Paul D. Klemperer (AER, 1996) argue that the usual concerns of auction design miss the big picture, and show that a simple English auction without a reserve price and N + 1 bidders attains expected ...
Increasing Outer Risk
(Department of Economics, 2004)
Recent empirical research has established that the distributions of a wide range of economic variables are kurtotic in that they have higher peak(s) in the neighborhood of the mean and greater elongation in the tails than the normal distribution...
Ex-Post Full Surplus Extraction, Straightforwardly
(Department of Economics, 2005)
Consider an estimate of the common value of an auctioned asset that is symmetric in the bidders' types. Such an estimate can be represented solely in terms of the order statistics of those types. This representation forms ...
Sub-Optimality of the Friedman Rule in Townsend's Turnpike and Limited Communication Models of money: Do finite lives and initial dates matter?
(Department of Economics, 2004)
We construct an economy populated with infinitely-lived agents and show that the Friedman rule is suboptimal. We do that by showing that our economy and an overlapping generations model in which the Friedman rule is known ...
Behavioral Foundations for Conditional Markov Models of Aggregate Data
(Department of Economics, 2007)
Conditional Markov chain models of observed aggregate share-type data have been
used by economic researchers for several years, but the classes of models commonly
used in practice are often criticized as being purely ad ...
Estimating the Impact of State Policies and Institutions with Mixed-Level Data
(Department of Economics, 2006)
clustered standard errors as a more straightforward, feasible approach, especially when working with large datasets or many cross-level interactions, our purpose in this Practical Researcher piece is to draw attention to the issue of clustering in state...
Optimality of the Friedman rule in overlapping generations model with spatial separation
(Department of Economics, 2003)
Recent papers suggest that when intermediation is analyzed seriously, the Friedman rule does not maximize social welfare in overlapping generations model in which money is valued because of spatial separation and limited communication. These papers...
When Do Input Prices Matter For Make-Or-Buy Decisions?
(Department of Economics, 2007)
informationally-demanding way to ensure efficient make-or-buy decisions is to price inputs at marginal cost. The extent to which input prices can depart from marginal cost while still inducing efficient make-or-buy decisions depends on the relative efficiency...
Money, output and the payment system: Optimal monetary policy in a model with hidden effort
(Department of Economics, 2007)
We propose a new explanation for the observed difference in the cost of intraday and overnight liquidity. We argue that the low cost of intraday liquidity is an application of the Friedman rule in an environment where a ...
Winner's Curse Corrections Magnify Adverse Selection
(Department of Economics, 2009)
The adverse-selection literature has only considered the case in which competing sellers' costs of supply are independent and privately known by the individual sellers. In contrast, the auction literature has ignored adverse ...
Crony Capitalism and Financial System Stability
(Department of Economics, 2001)
With the Asian financial crises, people identified crony relationships as the ultimate cause of bank instability. We examine the issue of crony capitalism in the context of model economy in which cronies are a class of ...