This paper discusses some economic aspects of the recent German and Austrian UMTS license auctions. We consider a stylized model of the open ascending auction with incomplete information and market externalities. It is shown that, if the dominant incumbent is not successful in pushing the...

We briefly survey several insights about value and revenue maximization in multi-object auctions and apply them to the German (and Austrian) UMTS auction. In particular, we discuss in detail the exposure probelm that caused firms in Germany to pay almost Euro 20 billion for nothing.

We estimate remaining life expectancy at age 65 using a very large sample of male German pensioners. Our analysis is entirely nonparametric. Furthermore, the data enable us to compare life expectancy in eastern and western Germany conditional on a measure of socio-economic status. Our findings...

The present contribution reviews the procedures (absolute, incremental and marginal capital allocation) as well as the general principles (proportional allocation, covariance-principle, conditional expectation-principle, conditional value-at-risk principle, Euler-principle) for risk based...

Investors and academics increasingly criticize that features of employee stock option (ESO) programs reflect rent-extraction by managers (managerial power view). We use a unique European data set to investigate the relationship between the design of ESO programs and corporate governance...

This paper describes the German pension reform process 1992-2007 with a stress on a remark-able development: the public pay-as-you-go-financed pension system has almost silently moved from a traditional defined benefit system to a system which works in many respects like a defined contribution...

In recent years the literature on household saving behavior has been enriched by a number of contributions focusing on the problem of modeling a household as a single decision unit. It has reasonably been argued that with respect to household consumption and saving behavior the simple approach...

Structural econometric methods that assume agents have rational expectations are often criticized. Yet, little is known about the relative costs and benefits of adopting alternative empirical strategies. This paper compares three procedures for inference about a single structural parameter using...

Why do some investors tend to ''sell winners too early and ride losers too long''? Such behavior, labeled the disposition effect, has been attributed to biases in return expectations, time-varying risk-aversion based on the value function of prospect theory, and regret theory. I review these...

This paper investigates the influence of a firm's financial status on the within-firm allocation of funds, reflected in its plant-level investment and exit decisions. In the empirical analysis, financial status is measured by both standard measures and an indicator variable recently suggested by...