This paper analyses the effects of taxation and subsidies in an economy with private provision of a public good. It is shown that in a situation where all individuals contribute, taxation affects the equilibrium allocation if and only if at least one individual's voluntary contribution to the public good has an impact on the aggregate tax payments of the others. We then consider linear nonneutral tax-subsidy schemes and analyse efficiency and uniqueness of the resulting Nash equilibria. We show that an efficient Nash equilibrium, where all individuals contribute, will in general not be unique, and establish a non-uniformity property which a tax-subsidy scheme must fulfil in order to induce a unique interior equilibrium that is efficient. Throughout the paper it is assumed that individuals fully understand and take into account the government's budget constraint.
It is a widely held belief that apprenticeship training represents a net investment for training firms, the cost of which needs to be recouped after the training period. A new firm-level data set for Switzerland reveals large variation in net costs across firms and, remarkably, negative net costs for 60 per cent of all firms. We use these data to estimate the effect of net costs on the number of apprentices hired by a firm. The results show that the costs have a significant impact on the training decision but no significant influence on the number of apprentices, once the firm has decided to train. For policy purposes, these results indicate that subsidies for firms that already train apprentices would not boost the number of available training places.
This paper evaluates the German health care reform of 1997, using the individual number of doctor visits as outcome measure and data from the German Socio-Economic Panel for the years 1995–1999. A number of modified count data models allow us to estimate the effect of the reform in different parts of the distribution. The overall effect of the reform was a 10% reduction in the number of doctor visits. The effect was much larger in the lower part of the distribution than in the upper part.
We consider a two-stage model of locational choice. Firms decide in which of three locations (or countries) to build plants; they then compete in all three markets. Knowledge spillovers reduce marginal costs in agglomerations; through intra-firm spillovers these cost reductions can be exported to other locations. We show that improvements in the exchange of information within firms make agglomeration more likely, because knowledge obtained in the center can be transmitted to other locations more easily. Decreases in transportation costs tend to destabilize agglomerations, since competition for peripheral locations increases, which decreases the value of knowledge obtained in agglomerations.
A new theoretical model is developed which describes the structure of competition for attention and characterizes equilibria. The exogenous fundamentals of an attention economy are the space of receiving subjects with their attention capacity, and the potential set of competing firms (senders) with their radiation technology. The endogenous variables explained by the theory are equilibrium audiences (the clients belonging to a sender), their signal exposure and attention, and the diversity of senders surviving the contest for attention. Application of the equilibrium analysis suggests that international integration or progress in information technologies tend to decrease global diversity. Local diversity, perceived by the individual receivers, may increase nonetheless.
This paper employs recent data for Germany and a new outcome variable to assess the consequences of parental separation on the well-being of youths. In particular, it is considered how subjective well-being, elicited from an ordinal 11-point general life satisfaction question, differs between youths living in intact and non-intact families, holding many other potential determinants of well-being constant using ordered probit regressions. The main finding of this study is that living in a non-intact family has not the hypothesised large negative effect on child well-being.
This article's point of departure is that the individual has to manage three stochastic assets, namely health, wealth, and wisdom (skills), which tend to be positively correlated. It shows that the unexpected components of insurance payments should be negatively correlated for minimizing total asset volatility. The empirical finding is that in the United States, Japan, and Germany, the lines of social insurance contribute less to diversification than do those of private insurance. The article concludes with suggestions for new, umbrella-type insurance contracts that in the future should help individuals in the efficient management of their assets.
This paper purports to analyze a hospital's adoption of both product and process innovation as a quantal choice. The impacts of this decision on physicians, while depending on institutions that differ between the US and continental Europe, are shown to feed back to the hospital, influencing the profitability of the innovation. Recent changes of hospital finance give rise to testable comparative predictions in both institutional settings.
The point of departure for this contribution is a problem common to all Western healthcare systems, namely the deficiency of their basic building block, the physician-patient relationship. This deficiency opens up a market for complementary agents in healthcare, ranging from medical associations to the central government. While Germany has traditionally put the emphasis on medical associations as the dominant complementary agent (DCA), it is shifting towards the central government. Switzerland, on the other hand, traditionally has relied on the cantonal governments and is now moving towards competing (quasi-) private health insurers that would function as DCAs. Thus, managed care, which is a means through which to reshape the physician-patient relationship, is used quite differently in the 2 countries, with differing expected outcomes and different consequences for the pharmaceutical industry.
