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In federal countries, competence for policy matters is often shared between various levels of government. As only overall outcomes are observed, this might blur accountability by decreasing voters' ability to infer information about the performance of their leaders. In this article, we analyse...
Persistent link: https://www.econbiz.de/10010310737
In this note, we argue that the Eurozone needs an institutional exit mechanism to enhance Eurozone stability, and propose modifications to the Dobbs' NEWNEY mechanism, the only mechanism that satisfies the twin properties of eliminating incentives for intra-Eurozone capital flight and...
Persistent link: https://www.econbiz.de/10010311046
We use a novel approach to address the question of whether a union of sovereign countries can efficiently raise and allocate a budget, even when members are purely self-interested and participation is voluntary. The main innovation of our model is to explore the link between budget contributions...
Persistent link: https://www.econbiz.de/10010311047
We consider the hold-up problem between a foreign direct investor and the government(s) in a host country with weak governmental structure and lack of power to commit. Using Nash threats, we show that an efficient investment level can be sustained for a sufficiently high discount factor and ask...
Persistent link: https://www.econbiz.de/10010307038
Politicians within any given party generally exhibit a degree similarity in terms of (political) viewpoints. Moreover, they are often constrained to follow general party lines on certain policy issues. Finally, they may be more likely to mimic one another than politicians from another party....
Persistent link: https://www.econbiz.de/10010306973
Consider a committee that in the past has made a promise not to confiscate the profits from a foreign investor. After the investment has taken place, there is a material benefit if the committee decides to default on the earlier promise. But there are also some small moral costs for those who...
Persistent link: https://www.econbiz.de/10010306978
This paper models the trade-off between production and appropriation in the presence of simultaneous inter- and intra-group conflicts. The model exhibits a 'group cohesion effect': if the contest between the groups becomes more decisive, or contractual incompleteness between groups becomes more...
Persistent link: https://www.econbiz.de/10010307032
Recent experimental results indicate that women do not like competitive environments as much as men do. Another literature is interested in the effect of social identity on economic behaviors. This paper investigates in the lab the impact of social identity on men and women's willingness to...
Persistent link: https://www.econbiz.de/10010307663
We investigate the effects of team competition on pro-social lending activity on Kiva.org, the first microlending website to match lenders with entrepreneurs in developing countries. Using naturally occurring field data, we find that lenders who join teams contribute 1.2 more loans ($30-$42) per...
Persistent link: https://www.econbiz.de/10010420880
Ample evidence shows that certain words or ways of phrasing things can cause us to change our preferences. We demonstrate one mechanism for why this happens - "framing" evokes norms which then influence choice. We use a laboratory study to test the impact of describing a series of dictator games...
Persistent link: https://www.econbiz.de/10011877504