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Saint-Paul, Gilles - C.E.P.R. Discussion Papers - 1992

spirit of Blanchard and Summers (1988), the model can generate multiple equilibria, with a low-quits/high-unemployment … equilibrium coexisting with a high-quits/low-unemployment equilibrium. Under weak conditions, low-unemployment equilibria Pareto … dominate high-unemployment equilibria. Mobility premia improve aggregate welfare but may increase unemployment. …

Persistent link: https://www.econbiz.de/10005791589

Multiple Equilibria and Minimum Wages in Labour Markets with Informational Frictions and Heterogenous Production Technologies

den Berg, Gerard J van - C.E.P.R. Discussion Papers - 2003

It is often argued that a mandatory minimum wage is binding only if the wage density displays a spike at it. In this Paper we analyse a model with search frictions and heterogeneous production technologies, in which imposition of a minimum wage affects wages even though, after imposition, the...

Persistent link: https://www.econbiz.de/10005666625

Consideration Sets and Competitive Marketing

Eliaz, Kfir; Spiegler, Ran - C.E.P.R. Discussion Papers - 2009

We study a market model in which competing firms use costly marketing devices to influence the set of alternatives which consumers perceive as relevant. Consumers in our model are boundedly rational in the sense that they have an imperfect perception of what is relevant to their decision...

Persistent link: https://www.econbiz.de/10008528545

Contracting under Incomplete Information and Social Preferences: An Experimental Study

Hoppe, Eva I; Schmitz, Patrick W - C.E.P.R. Discussion Papers - 2013

Principal-agent models in which the agent has access to private information before a contract is signed are a cornerstone of contract theory. We have conducted an experiment with 720 participants to explore whether the theoretical insights are reflected by the behavior of subjects in the...

Persistent link: https://www.econbiz.de/10011084433

Can Contracts Solve the Hold-Up Problem? Experimental Evidence

Hoppe, Eva I; Schmitz, Patrick W - C.E.P.R. Discussion Papers - 2009

In the contract-theoretic literature, there is a vital debate about whether contracts can mitigate the hold-up problem when renegotiation cannot be prevented. Ultimately, the question has to be answered empirically. As a first step in that direction, we have conducted a laboratory experiment...

Persistent link: https://www.econbiz.de/10005067500

Bargaining with Imperfect Enforcement

White, Lucy; Williams, Mark - C.E.P.R. Discussion Papers - 2006

The game-theoretic bargaining literature insists on non-cooperative bargaining procedure but allows 'cooperative' implementation of agreements. The effect of this is to allow free-reign of bargaining power with no check upon it. In reality, courts cannot implement agreements costlessly, and...

Persistent link: https://www.econbiz.de/10005662212

Gathering Information before Signing a Contract: Experimental Evidence

Hoppe, Eva I; Schmitz, Patrick W - C.E.P.R. Discussion Papers - 2009

A central insight of agency theory is that when a principal offers a contract to a privately informed agent, the principal trades off ex post efficiency in the bad state of nature against a larger profit in the good state of nature. We report about an experiment with 508 participants designed to...

Persistent link: https://www.econbiz.de/10005789080

Network Structure and Strategic Investments: An Experimental Analysis

Rosenkranz, Stephanie; Weitzel, Utz - C.E.P.R. Discussion Papers - 2008

This paper analyzes the effects of network positions and individual risk attitudes on individuals' strategic decisions in an experiment where actions are strategic substitutes. The game theoretic basis for our experiment is the model of Bramoullé and Kranton (2007). In particular, we are...

Persistent link: https://www.econbiz.de/10005136539

Choosing the Stick or the Carrot? Endogenous Institutional Choice in Social Dilemma Situations

Haigner, Stefan; Kocher, Martin; Sutter, Matthias - C.E.P.R. Discussion Papers - 2006

We analyse an experimental public goods game in which group members can endogenously determine whether they want to supplement a standard voluntary contribution mechanism with the possibility of rewarding or punishing other group members. We find a large and positive effect of endogenous...

Persistent link: https://www.econbiz.de/10005114368

A Multi-Task Theory of the State Enterprise Reform

Bai, Chong-En; Li, David Daokui; Tao, Zhigang; Wang, Yijiang - C.E.P.R. Discussion Papers - 2001

During transition, maintaining employment and providing a social safety net for the unemployed are important to social stability, which in turn is crucial for the productivity of the whole economy. Because independent institutions for social safety are lacking and firms with strong profit...

Persistent link: https://www.econbiz.de/10005504537