We estimate the relative contribution of recursive preferences versus adaptive learning in accounting for the tail thickness of price–dividends/rents ratios. We find that both of these sources of volatility account for volatility in liquid (stocks) but not illiquid (housing) assets.

We axiomatize decreasing impatience (DI) in a discrete-time setting, as originally discussed by Prelec, and formulate a class of recursively-defined discounting functions that conform to DI. The recursive formulation is used to analyze the Ramsey growth problem using dynamic programming techniques.

We test the relation between income and democracy during the postwar period. We employ panel estimation methods that explicitly allow for the fact that the primary measures of democracy are censored with substantial mass at the boundaries. We find that the statistically significant positive...