It is well known that externalities cause fundamental nonconvexity problems in the production sets. We use the differentiable approach to establish existence without requiring aggregate convexity in consumption nor production. Our model allows general externalities in consumption and production...

Models of city systems based on market theories are unable to replicate their size distribution. The stochastic process approach to size distribution, which asserts proportional growth, does not provide a strong economic foundation. Hence an apparent irreconcilability. We propose that since...

A significant portion of flood damages were not covered by insurance, and policies are devised to promote insurance coverage. There are, however, rational reasons for why households may not purchase full insurance facing risks. We discuss optimal underinsurance when there are uninsurable losses...

Many local public goods are provided in coalitions. When coalitions form they may have the power to exclude members. The core applies to such cases. When coalitions cannot exclude members, all who prefer the provided public good can join. The no-exodus equilibrium is proposed for such cases. It...