Our experimental analysis of alliances in conflicts leads to three main findings. First, even in the absence of repeated interaction, direct contact or communication, free-riding among alliance members is far less pronounced than what would be expected from non-cooperative theory. Second, this...

This paper studies corporate tax competition if it is costly to learn some of the elements that determine the effective tax burden. Search cost may, but need not, eliminate the tax competition pressure. The outcome depends on the boundaries of tax rate and tax base choices. Search cost can...

This paper develops a competition theory framework that evaluates an important aspect of the OECD's Harmful Tax Practices Initiative against tax havens. We show that the sequential nature of the process is harmful and more costly than a 'big bang' multilateral agreement. The sequentiality may...

n.a.

If firms compete in all-pay auctions with complete information, silent shareholdings introduce asymmetric externalities into the allpay auction framework. If the strongest firm owns a large share in the second strongest firm, this may make the strongest firm abstain from bidding. As a...

Contestants have to choose whether to initiate a contest or war, or whether to remain peaceful for another period. We find that agents wait and initiate the contest once their rival is sufficiently weak to be an easy target.

Anläßlich eines Symposiums, veranstaltet vom neu gegründeten Forschungsinstitut zur Zukunft der Arbeit (IZA) in Bonn, legten sechs Ökonomen in einer „Petersberger Erklärung' Thesen zur Arbeitsmarktpolitik vor. Nachfolgend der Wortlaut der Erklärung

This paper considers terrorism as an extortion activity. It uses tools from the theory of extortion and from conflict theory to describe how terrorism works, why terrorism is a persistent phenomenon, why terrorism is a violent phenomenon, and how retaliation affects the outcome. The analysis...

We study the residential choice of siblings who are altruistic towards their parents. The first-born child’s location choice influences the behavior of the second-born child and can shift some of the burden of providing care for the parents from one child to the other. These strategic...