In markets with budget-constrained buyers, competitive equilibria need not be efficient in the utilitarian sense, or maximise the seller's revenue. We consider a setting with multiple divisible goods. Competitive equilibrium outcomes, and only those, are constrained utilitarian efficient, a...

Post Keynesian Economics has shifted away and even renegade from Keynes' original research program, i.e., the Unemployment Equilibrium thesis, endogenous money and liquidity preference determination of interest rate in which money and uncertainty play a fundamental part. This paper attempts to...

We study the reaction of low vs. high-skilled politicians to a reform, approved in Italy in 2011, that introduces stringent individual financial and career sanctions to local administrators who are judged responsible for their municipality’s bankruptcy. To this aim, we leverage exogenous...

This paper shows how the Marginal Value of Public Funds (MVPF) can guide treatment allocation to improve social welfare. Under budget constraints, the optimal treatment targets individuals with MVPFs above a threshold that minimizes the opportunity cost of treatment. Using experimental data, we...

When faced with budget-constrained bidders, all-pay auctions revenue-dominate standard auctions (Örst and second-price), which, in a competitive market, gives an edge to the all-pay format. An equilibrium in which sellers compete with standard auctions fails to exist if the all-pay format is...

We propose an easy-to-use method for estimating preference parameters experimentally: choices from strictly concave budget restrictions (SCBRs). SCBRs generalize the popular method of analyzing choices from linear budget restrictions (LBRs). SCBRs promise (i) to improve the informational content...

In this paper, we explore the effects of India's federal structure on state-level fiscal responsibility. Drawing from a 1991-2018 dataset, we argue that higher levels of transfer and borrowing dependence (soft budget constraints) from the central government facilitate lower levels of fiscal...

This paper explores the influence of the State Capital Investing and Operating Company (SCIOC) pilot reform on SOE bailout using a staggered difference-in-differences model. Based on a sample of listed SOEs during 2011-2018, we find that when the real controllers of listed SOEs enter the list of...

This paper investigates the impact of financial constraints on firms' inventory holdings, an area of significant interest given that inventories are volatile over the business cycle. I use detailed data on Swedish firms' balance sheets, income statements, and credit scores. I employ a regression...

We postulate a general salience framework where agents are biased in their perception about the impact of consumption on their (intertemporal and otherwise) budget constraints. Three applications are provided. First, we trace and illustrate the consequences of applying this salience framework to...

Chapter 1. Janos Kornai’s intellectual legacy: An Introduction -- Section 1: General assessment -- Chapter 2. Introduction to Section 1 -- Chapter 3. In Janos Kornai’s Memory -- Chapter 4. Introduction: A special issue in honoring Janos Kornai -- Chapter 5. Socialism and Kornai’s...

Several football stadiums were built or renovated in France for hosting the 2016 UEFA European Football Championship. This study examines to which extent the financial support by local governments for stadium construction or renovation induces soft budget constraints (SBC) for professional...

This paper examines the sensitivity of investment to cash flow using a panel of UK firms in manufacturing with a view to shedding some light on the existence of a balance sheet channel or financial accelerator. In addition to examining the impact of cash flow in different subsamples based on...

This paper uses Chinese data to calibrate a monetary policy model, so as to study the special impact of sectoral differences in financing and budget constraints on developing countries' monetary policy. The paper finds that real estate transactions, as a particularly effective monetary policy...

In Health Technology Assessment (HTA), commonly used techniques apply piecewise comparisons of two or more alternatives, comparing costs and outcomes associated with each treatment. According to the definition by Robbins, who considers economics the study of ‘alternative uses’ of resources...

This paper investigates the impact of the moderate growth of government borrowing on debt sustainability in 11 Russian regions over about 10 years, starting in 2010. The current study aims to assess the debt sustainability of the Russian region's budget by determining Euclidean distance budget...

This paper describes interactions between monetary and fiscal policies that affect equilibrium price levels and interest rates by critically surveying theories about (a) optimal anticipated inflation, (b) optimal unanticipated inflation, and (c) conditions that secure a "nominal anchor'' in the...

We study the design of revenue-maximizing mechanisms for value-maximizing agents with budget constraints. Agents have return-on-spend constraints requiring a minimum amount of value per unit of payment made and budget constraints limiting their total payments. The agents' only private...