In this paper we adopt a vertical differentiation model to study the effect of deregulation in the airline industry. In particular, we focus on the entry of low cost companies, which succeed in providing essential flight services at relatively cheap prices. We argue that the entry of very...

This paper examines the effect of trust in a micro-economic environment, where trust is clearly exogenous. Using a hand-collected data on European venture capital, we show that the Eurobarometer measure of trust among nations significantly affects investment decisions. This holds even after...

In this briefly note we extend the Mountford.s article "Can a Brain Drain be good for growth in the source economy?" by introducing an active role of the government in the education decisions of the agent by public education, taxes and subsidies. First, we demonstrate that the main results...

In markets where product quality is important, more than one characteristic is usually necessary to define product quality and the amelioration of the goods characteristics is usually costly. Then, properties of production technologies, in particular if they exhibit economies or diseconomies of...

We use a simple version of the Psychological Expected Utility Model (Caplin and Leahy, QJE, 2001) to analyze the optimal choice of information accuracy by an individual who is concerned with anticipatory feeling. The individual faces the following trade-off: on the one hand information may lead...

We compare the alternative approaches for regulating genetic information in the health insurance market when prevention measures are available. In the model, firms offer insurance contracts to consumers who are initially uninformed of their risk type but can obtain such information by performing...

The issue of technical progress under uncertainty is nested into the debate on vertical integration vs outsourcing, to show that, in general, the former is preferable to the latter in terms of both expected profits and technological efficiency. It is then shown that there exist (i) an optimal...

Die internationale Literatur zur langfristigen Einkommensverteilung zeigt ein nicht einheitliches Bild. Insbesondere in den angelsächsischen Ländern ist im hundertjährigen Vergleich die Einkommenskonzentration seit Ende der 1980er-Jahre deutlich gestiegen. Im Jahr 2007, unmittelbar vor...

Umfragen zeigen, dass die Österreicher mit ihrem Leben relativ wenig zufrieden sind: Nur Portugiesen, Italiener, Griechen, Spanier und Franzosen fühlten sich in der letzten europaweiten (jetzt veröffentlichten) Umfrage im Frühsommer unzufriedener. Besonders hoch – und zwar weit mehr als...