We analyse the conditions under which an (S,s) rule may be derived and compare these with alternative rules. We consider the case of labour demand with fixed adjustment costs. The (S,s) rule implies a specific ordering of choices: downward adjustment, non-adjustment and upward adjustment with...

In this paper we analyse methods which allow us to estimate and identify the sources of censoring in dynamic models. We explicitly take into account the existence of corner solutions by considering a discrete-time-discrete-choice dynamic structural model. The availability of microeconomic...

In this paper we consider various privatisation mechanisms in a general equilibrium model. We show that privatisation has no real effects, if the public sector is efficient and lump-sum taxes are implemented. The free distribution of public assets is financially neutral, whereas the sale of...

The purpose of the paper is to outline an analytical framework which captures the ample scope of locational competition: cost differences, resulting from differences in factor prices including taxes, human capital, infrastructure services and total factor productivity. If cost differences are...

The paper considers the problem of evaluating the probability of investing in a capital-investment project as a measure of the uncertainty-investment relationship in a real option model. By the use of the contingent claims analysis the opportunity to invest is modelled as an American call option...

We consider a model with two countries, two commodities and production factors, labour and environment. The countries first choose their environmental standards and then the equilibrium market allocations are determined. We study a subgame perfect Nash equilibrium of this game for two types of...

Distributional assumptions are crucial in the estimation of the value of public projects assessed by means of contingent valuation analyses, and it would seem obvious that tests for model specification should play an important part in the statistical analysis. It can be observed, though, that...

In this paper we study two closely related issues. First, the role of technology heterogeneity and diffusion in the convergence of GDP per worker observed across the European regions, in the absence of data on regional TFP. Second, the spatial pattern of the observed regional heterogeneity in...

We study the government's decision to sell a state-owned enterprise to strategic investors in a common value auction setting. The government can choose to sell his control stake all at once, or to design a sequential auction of shares. The sequential auction allows information transmission, so...