Environmental Taxation and Vertical Cournot Oligopolies: How Eco-industries Matter

This article specifies what an optimal pollution tax should be when dealing with a vertical Cournot oligopoly. Polluting firms sell final goods to consumers and outsource their abatement activities to an environment industry. It is assumed that both markets are imperfectly competitive. Thus, the tax is a single instrument used to regulate three sorts of distortions, one negative externality and two restrictions in production. Consequently, the optimal tax rate is the result of a trade-off that depends on the firms’ market power along the vertical structure. A detailed analysis of Cournot-Nash equilibria in both markets is also performed. In this context, the efficiency of abatement activities plays a key-role. It gives a new understanding to the necessary conditions for the emergence of an eco-industrial sector.      

Using Stock Price Information to Regulate Firms

This paper examines the role of the information contained in stock prices in the regulation of privatized firms. Stock prices contain noisy but unbiased information about firm's future prospects that regulators can use to decide on some regulatory policies. The main argument developed is that the observation of stock price movements reduces the incentives of regulators to develop their own monitoring technologies and can allow them to commit to relatively light-handed regulations. This protects firm's investments in cost reduction activities and can increase ex ante welfare.     

Assessing Applied Protection across the World*

This paper presents MAcMap–HS‐6, a database providing a consistent, ad valorem equivalent measure of tariff duties and tariff rate quotas for 163 countries and 208 partners, at the six‐digit level of the Harmonized System (5111 products), accounting for all preferential agreements. We describe the methodology used to compute and aggregate an ad valorem equivalent of applied protection. Emphasis is placed on minimizing the endogeneity bias in the aggregation procedure, while acknowledging structural differences in export specialization. The resulting quantitative assessment is illustrated by giving an overview of applied protection across the world in 2001, in terms of average as well as distribution.     

The somatic marker hypothesis: A neural theory of economic decision

Modern economic theory ignores the influence of emotions on decision-making. Emerging neuroscience evidence suggests that sound and rational decision making, in fact, depends on prior accurate emotional processing. The somatic marker hypothesis provides a systems-level neuroanatomical and cognitive framework for decision-making and its influence by emotion. The key idea of this hypothesis is that decision-making is a process that is influenced by marker signals that arise in bioregulatory processes, including those that express themselves in emotions and feelings. This influence can occur at multiple levels of operation, some of which occur consciously, and some of which occur non-consciously. Here we review studies that confirm various predictions from the hypothesis, and propose a neural model for economic decision, in which emotions are a major factor in the interaction between environmental conditions and human decision processes, with these emotional systems providing valuable implicit or explicit knowledge for making fast and advantageous decisions.     

Collusion, Delegation and Supervision with Soft Information

This paper shows that supervision with soft information is valuable whenever supervisors and supervisees collude under asymmetric information and proceeds then to derive an Equivalence Principle between organizational forms of supervisory and productive activities. We consider an organization with an agent privately informed on his productivity and a risk averse supervisor getting signals on the agent's type. In a centralized organization, the principal can communicate and contract with both the supervisor and the agent. However, these two agents can collude against the principal. In a decentralized organization, the principal only communicates and contracts with the supervisor who in turn sub-contracts with the agent. We show that the two organizations achieve the same outcome. We discuss this equivalence and provide various comparative statics results to assess the efficiency of supervisory structures.     

Currency competition: A partial vindication of Hayek

This paper establishes the existence of equilibria for environments in which outside money is issued competitively. Such equilibria are typically believed not to exist because of a classic overissue problem: if money is valued in equilibrium, an issuer produces money until its value is driven to zero. By backward induction, money cannot have value in the first place. This paper shows that overissuance is not a problem if agents believe that if an issuer produces more than some threshold number of notes, then only those notes issued up to the threshold will be valued; additional notes will be worthless. This result is very general, applying to any monetary economy in which equilibria with and without valued money exist if the money supply is finite. The paper also compares the allocation achieved by a monopolist to that achieved with competitive issuance in both a search and an overlapping-generations environment. The results depend on the environment considered, but two general conclusions arise. First, it is ambiguous whether competitive issuers can achieve a more desirable allocation than a monopolist. Second, with competitive issuance, a licensing agency can always improve on pure laissez-faire and achieve the efficient allocation in the long run.     

Job protection,housing market regulation,and the youth

Young Europeans experience high unemployment rates, job instability, and late emancipation. Meanwhile, they do not support reforms weakening protection on long‐term contracts. In this paper, we suggest a possible rationale for such reform distaste. When the rental market is strongly regulated, landlords screen applicants with regard to their ability to pay the rent. Protecting regular jobs offers a second‐best technology to sort workers, thereby increasing the rental market size. We provide a model where nonemployed workers demand protected jobs despite unemployment and the share of short‐term jobs increases, whereas the individual risk of dismissal is unaffected. Our theory can be extended to alternative risks and markets involving correlated risks and commitment under imperfect information.     

Disequilibrium,Reproduction and Money: a Classical Approach

We consider a bisector reproduction model in which money is introduced as a pure means of exchange issued by a bank at the producers' requests. Each capitalist aims at maximizing accumulation in his own sector. Their plans are based on available quantities and expected prices. Effective prices are determined by a market mechanism. Temporary disequilibria occur in both physical and monetary terms. The settlement of the monetary balances is operated by means of a transfer of capital goods. Final allocations and effective productions are thus determined. The dynamics of the economy are those of a sequence of temporary disequilibria and let appear several possibilities (local or global stability, cycles) depending on the values of the parameters.     

Researching taste: an interview of Antoine Hennion

ABSTRACT

Antoine Hennion is a Professor of Sociology at the Centre de Sociologie de l’Innovation (Mines-Paris Tech, PSL/CNRS). He has been researching taste and cultural practices through a pragmatic lens for three decades. He has developed an original and impactful theoretical framework bridging the Actor-Network Theory to Cultural Studies. More precisely, he reconceptualized the notions of mediation and attachment. Antoine Hennion has explored various empirical settings, including music, wine, and sports. More recently, he has contributed to a large research project on migration. His books and academic articles have had an impact on Sociology, and are getting greater attention in consumer research.     

Agent-Based Reallocation Problem on Social Networks

Resource reallocation problems aim to determine an allocation maximizing a given objective function. Numerous applications are based on the assumption of restricted contacts between entities but, up to now, studies have been based on unrealistic contexts. Indeed, most of the time, agents are omniscient and/or have complete communication abilities, which are not plausible assumptions in many applications. A solution does not only consist in an optimal allocation, but in a sequence of transactions changing an initial allocation into an optimal solution. We show that the individual rationality does not allow the achievement of socially optimal allocations, and we propose a more suitable criterion: the sociability. Our method provides a sequence of transactions leading to an optimal allocation, with any restriction on agents’ communication abilities. Provided solutions can be viewed as emergent phenomena.