This paper deals with the identification and estimation of dynamic games when players’ beliefs about other players’ actions are biased, i.e., beliefs do not represent the probability distribution of the actual behavior of other players conditional on the information available....

We present a simple model motivated by the events in Archie Comics #600 (May, 2009). We demonstrate that under a simple set of assumptions, Archie is better off extending a marriage proposal to Veronica rather than Betty.

Firm-level idiosyncratic policy distortions misallocate resources between firms, lowering aggregate productivity. Many environmental policies create such distortions; in particular, output-based intensity standards (which limit firms' energy use or emissions per unit of output) are easier for...

We construct the ratio of the post-fisc transitory income variance to the pre-fisc transitory income variance of family incomes as a measure of fiscal progressivity in Canada between 1993 and 2008. This ratio can be interpreted as measuring the extent to which the fiscal system attenuates...

In this paper we investigate the relationship between crude oil and gasoline prices and also examine the effect of oil price uncertainty on gasoline prices. The empirical model is based on a structural vector autoregression that is modifiÂ…ed to accommodate multivariate GARCH-in-Mean errors,...

I provide a simple model that is solved analytically to yield tidy expressions for the Pareto efficient tax structures and the optimal two-bracket marginal tax rates. It is for the special case of equally-sized groups of two skill types and no exogenous spending requirements of the government....