This paper has two goals. First, we discuss several emerging approaches to applied welfare analysis under non-standard ("behavioral") assumptions concerning consumer choice. This provides a foundation for Behavioral Public Economics. Second, we illustrate applications of these approaches by...

This paper provides a non-technical overview of the economic arguments related to the desirability of transfer taxation and a summary of empirical evidence surrounding these issues. Understanding optimal transfer taxation throughout the distribution requires understanding the nature of a bequest...

This paper studies optimal dynamic tax policy under the threat of political reform. A policy will be reformed ex post if a large enough political coalition supports reform; thus, sustainable policies are those that will continue to attract enough political support in the future. We find that...

We study the differences between public production and public finance of public goods in a dynamic general equilibrium model. Under public production, public goods are produced by the government. Under public finance, the same amount of public goods is produced by cost-minimizing private...

We investigate two alternative explanations why men may hold more stocks than women do. Apart from the traditional explanation of a gender difference in risk aversion, gender differences in either optimism or in perceived risk of financial markets might cause men to hold riskier assets. Our...

The real options framework has been used extensively to analyze the timing of investment under uncertainty. While standard real options models assume that agents possess a constant rate of time preference, there is substantial evidence that agents are very impatient about choices in the...

Social Security benefits are currently provided as a lifelong benefit stream, though some workers would be willing to trade a portion of their annuity streams in exchange for a lump sum amount. This paper explores whether allowing people to receive a lump sum as a payment for delayed retirement...

Private investors increasingly use passive investment strategies, i.e. investment methods that try to replicate a stock market index as accurate as possible. In this paper we compare retail index certificates and exchange traded funds. Both investment products promise a performance that...