infonet-economy

We construct a theory of intergenerational preference transmission that rationalizes the choice between alternative parenting styles (related to Baumrind 1967). Parents maximize an objective function that combines Beckerian and paternalistic altruism towards children. They can affect their children’s choices via two channels: either by influencing their preferences or by imposing...

We conduct a laboratory experiment to study whether people intuitively use real-option strategies in a dynamic investment setting. The participants were asked to play as an oil manager and make production decisions in response to a simulated mean-reverting oil price. Using cluster analysis, participants can be classified into four groups, which we label ‘mean-reverting’, ‘Brownian...

This paper exploits variation in the timing and outcomes of
employment discrimination lawsuits against U.S. law enforcement agencies
to estimate the cumulative and persistent employment effects of
temporary externally imposed affirmative action (AA). We find that AA
increased black employment at all ranks by 4.5 to 6.2 percentage points
relative to...

This paper proposes a dynamic politico-economic theory of fiscal policy in a world comprising a set of small open economies, whose driving force is the intergenerational conflict over debt, taxes, and public goods. Subsequent generations of voters choose fiscal policy through repeated elections. The presence of young voters induces fiscal discipline, i.e., low taxes and low debt...

Optimal choices benefit from previous learning. However, it is not clear how previously learned stimuli influence behavior to novel but similar stimuli. One possibility is to generalize based on the similarity between learned and current stimuli. Here, we use neuroscientific methods and a novel computational model to inform the question of how stimulus generalization is implemented...

Das Geschehen auf den Finanzmärkten hängt vom individuellen Verhalten ab, wird aber auch wesentlich bestimmt durch die Ausgestaltung des Finanzsystems, das heisst durch die Rollen, die den einzelnen Akteure zugewiesen werden, und durch die Regeln für die Interaktion der verschiedenen Rollen. Diese Arbeit behandelt nach einleitenden methodischen Vorbemerkungen zunächst die Frage der...

Sichern Rankings wirklich die Qualität der Universitäten? Eine Replik.

This paper determines the value of asset tradeability in an option pricing framework. In our model, tradeability is valuable since it allows investors to exploit temporary mispricings of stocks. The model delivers several novel insights on the value of tradeability: The value of tradeability is the larger, the higher the pricing efficiency of the market is. Uncertainty increases the...