Revelation principle implies that given any admissible social welfare function, the outcome of Baron and Myerson's (1982) (BM) optimal direct-revelation mechanism under incentive constraints cannot be dominated by any other mechanism in expected utilities. However, since the expected total...

We study the effects of non-sterilized intervention on a spot foreign exchange rate using a multi-period game-theoretical model which involves an unspecified number of competitive traders, a finite number of strategic traders (forex dealers), and the central bank of the home country. Simulating...

Revelation principle implies that given any admissible social welfare function, the outcome of Baron and Myerson's (1982) (BM) optimal direct-revelation mechanism under incentive constraints cannot be dominated by any other mechanism in expected utilities. However, since the expected total...

In this paper, we use a two-period one-to-one matching model with incomplete information to examine the effect of changes in divorce costs on marital dissolution. Each individual who has a nontransferable expected utility about the quality of each potential marriage decides whether to marry or...

To evaluate the costs and benefits of various anti-smoking policy alternatives including taxation and four cessation programs, accounting for the demographic projections in 2011-2050 in Turkey. Demographic projections are combined with incidence and mortality rates of four major cigarette...

There is a conflict in the mechanism for price determination used in a Marshallian partial equilibrium supply and demand framework and the Walrasian general equilibrium framework. It is generally thought that partial equilibrium is a simplified approximation to the complexities of the general...

This paper introduces a class of endogenously proportional bargaining solutions. These solutions are independent of the class of Directional solutions, which Chun and Thomson (1990a) proposed to generalize (exogenously) proportional solutions of Kalai (1977). Endogenously proportional solutions...

In this paper, we provide a welfare ranking for the equilibria of the supply function and quantity competitions in a differentiated product duopoly with demand uncertainty. We prove that the expected consumer surplus is always higher under the supply function competition, irrespective of whether...

This paper is about instability of equilibrium real rents in a pure exchange economy. Our main result hinges upon a low degree of substitutability between housing services and other commodities together with a low share of owner-occupied houses. We argue that regions or economies with a low...

This paper presents a simple model of housing cycles in a two good economy. We establish that nonsubstitutability between housing services and other commodities along with high degree of heterogeneity in home ownership may lead to a stable spiral path converging to a steady-state equilibrium of...