Social choice theory critically assesses and rationally designs economic mechanisms for improving human well-being. Kotaro Suzumura—one of the world’s foremost thinkers in social choice theory and welfare economics—fuses abstract ideas with real-world economies to examine foundational...

In a mixed-strategy Nash equilibrium, changing one player's payoffs affects only the other player's equilibrium strategy mix. This `Payoff Irrelevance Proposition' (PIP) appears to undercut the main foundations of economic policy analysis since, allegedly, equilibrium behavior will not respond...

It is well known that risk increases the value of options. This article makes that precise in a new way. The conventional theorem says that the value of an option does not fall if the underlying asset becomes riskier in the conventional sense of the mean-preserving spread. This article uses two...

The possibility of buying out an entrant has an import ant effect on entry deterrence. Entrants can blackmail the incumbent by threatening to keep prices low, and buyout can make entry profitab le which otherwise would not be. In particular, the entry-deterrence policy of excess capacity to...