When politicians have lower discount factors than voters, democratic elections cannot sufficiently motivate politicians to undertake long-term socially beneficial projects. When politicians can offer incentive contracts which become effective upon reelection, the hierarchy of contracts and...

"Pendular Voting" presents a novel two-stage voting procedure: A randomly chosen citizen group votes on a proposal replacing the status quo. Depending on the outcome, a "counterproposal" ensues, that is closer to/further away from the status quo than the original proposal. All citizens vote...

We analyze whether different learning abilities of firms with respect to general equilibrium effects lead to different levels of unemployment. We consider a general equilibrium model where firms in one sector compete à la Cournot and a real wage rigidity leads to unemployment. If firms consider...