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Foreign Aid Designed to Diminish Terrorist Atrocities can Increase Them

Mandler, Michael; Spagat, Michael - C.E.P.R. Discussion Papers - 2003

A domestic power faces an enemy and commits terrorist atrocities to increase the likelihood of victory. A foreign patron can grant aid to the power but prefers fewer or no atrocities. The domestic power responds by acquiescing in the creation of uncontrollable paramilitaries that commit even...

Persistent link: https://www.econbiz.de/10005504744

Signalling and Commitment: Monetary versus Inflation Targeting

Gersbach, Hans; Hahn, Volker - C.E.P.R. Discussion Papers - 2003

This Paper compares the social efficiency of monetary targeting and inflation targeting when central banks may have private information on shocks to money demand and, because of verifiability problems, the transparency solution is not feasible. Under inflation targeting and monetary targeting,...

Persistent link: https://www.econbiz.de/10005497735

Efficiency-Enhancing Signalling in the Samaritan's Dilemma

Lagerlöf, Johan N. M. - C.E.P.R. Discussion Papers - 2003

Suppose an altruistic person - A - is willing to transfer resources to a second person - B - if B comes upon hard times. If B anticipates that A will act in this manner, B will save too little from both agents’ point of view. This is the Samaritan’s dilemma. The logic of the dilemma has been...

Persistent link: https://www.econbiz.de/10005497793

Does Speed Signal Ability? The Impact of Grade Repetitions on Employment and Wages

Brodaty, Thomas; Gary-Bobo, Robert J.; Prieto, Ana - C.E.P.R. Discussion Papers - 2008

We propose a new test for the presence of job-market signalling in the sense of Spence (1973), based on an equation in … nonlinear model of education choices and cannot reject the assumption that the data is generated by a job-market signalling …

Persistent link: https://www.econbiz.de/10005498114

Signalling, Incumbency Advantage, and Optimal Reelection Thresholds

Caselli, Francesco; Cunningham, Tom; Morelli, Massimo; … - C.E.P.R. Discussion Papers - 2012

types to voters. We identify two novel implications of models in which signalling incentives are important. First, because …. Second, voters can exploit the signalling behavior of politicians by precommitting to a higher threshold for signals received …. Raising the threshold discourages signalling effort by low quality politicians but encourages effort by high quality …

Persistent link: https://www.econbiz.de/10011083735

First Impressions Matter: Signalling as a Source of Policy Dynamics

Hansen, Stephen; McMahon, Michael - C.E.P.R. Discussion Papers - 2013

We provide the first direct empirical support for the relevance of signalling in monetary policy. In our dynamic model …. Signalling leads all bankers to be tougher on inflation initially, but to become less tough with experience. This evolution is … structurally estimate the model using Bank of England data and confirm both predictions. Signalling increases the probability new …

Persistent link: https://www.econbiz.de/10011084410

Bubble Thy Neighbor: Portfolio Effects and Externalities from Capital Controls

Forbes, Kristin; Fratzscher, Marcel; Straub, Roland - C.E.P.R. Discussion Papers - 2012

. Much of the effect of capital controls on portfolio flows appears to occur through signalling (i.e. changes in investor …

Persistent link: https://www.econbiz.de/10011084681

Why Vote for Losers?

Castanheira, Micael - C.E.P.R. Discussion Papers - 2002

Voting Theory generally concludes that, in first-past-the-post elections, all votes should go to effective candidates (Duverger’s Law), and parties should adopt a similar platform (Median Voter Theorem). Such predictions are not always met in practice, however. We show why divergence and vote...

Persistent link: https://www.econbiz.de/10005067598

Is Central Bank Transparency Desirable?

Sibert, Anne - C.E.P.R. Discussion Papers - 2006

I analyse central bank transparency when the central bank's objective function is its private information. Non-transparency exists when the public does not observe the action of the central bank and an unobservable component of the inflation-control error keeps the public from using its...

Persistent link: https://www.econbiz.de/10005656252

Self-Confidence & Social Interactions

Bénabou, Roland; Tirole, Jean - C.E.P.R. Discussion Papers - 2000

This paper studies the interactions between an individual's self-esteem and his social environment - in the workplace, at school, and in personal relationships. Because a person generally has only imperfect knowledge of his own abilities, people who derive benefits from his performance (parent,...

Persistent link: https://www.econbiz.de/10005656299