Newspapers’ market shares and the theory of the circulation spiral

We consider a model of daily newspapers’ competition to test the validity of the so-called “theory of the circulation spiral”. According to it, the interaction between the newspapers and the advertising markets drives the newspaper with the smaller readership into a vicious circle, finally leading it to death. In a model with two newspapers, we show that, contrary to this conjecture, the dynamics envisaged by the proposers of the theory, does not always lead to the elimination of one of them.     

To Shock or Not to Shock? Economics and Political Economy of Large-Scale Reforms

This paper studies the economics and political economy of optimal scale of reforms. The aim of the reform is to replace inefficient existing institutions by the more efficient new ones. The optimal scale of reform, in general, differs from a shock therapy that replaces the old institutions all at once. Furthermore, if agents in the economy are heterogeneous in terms of their subjective discount rates, the politically-determined reform speed may be lower in a democracy than in an economy with a benevolent dictator.     

Political Determinants of Intergovernmental Grants: Evidence From Argentina

This paper explores the determinants of federal grants allocation across provincial states in Argentina. Our analysis suggests that the redistributive pattern implicit in the federal system of intergovernmental grants cannot be explained on normative grounds exclusively. In order to understand the rationale behind federal grants distribution, a positive approach could render better results. Specifically, we claim that the distribution of federal grants could be associated with political variables such as the political representation of jurisdictions at Congress. The econometric analysis suggests that the significant disparity observed in the per capita representation across different provinces is an important factor explaining the allocation of those transfers. In this respect, overrepresented provinces, both at the senate and at the lower chamber, have received, on average, higher resources from the national government compared to more populous and less represented states. These results are consistent with those observed in other countries.     

To Ban or Not to Ban: Foreign Lobbying and Cross‐National Externalities

This paper studies the costs and benefits of foreign lobbying. We show how and when foreign lobbying can help internalize cross‐national externalities. We argue that this is an often overlooked benefit of foreign lobbying. We also study under what conditions a constitutional rule banning foreign lobbying is in the national interest of a country. A key factor in this calculus is whether the interests of foreign lobby groups and domestic unorganized groups coincide or not. We illustrate the logic with examples from trade policy and environmental regulation.     

To Go or Not to Go: Emigration from Germany

Abstract. This study analyses the qualitative aspects of emigration from Germany, taking account of economic and non-economic reasons. The reported willingness to emigrate from Germany in the German Socio-Economic Panel (GSOEP) is explained for men and women by three groups of variables: individual characteristics, household characteristics and regional characteristics. It transpires that the educational background and West German residency positively affect the willingness to emigrate, whereas German nationality, age and the family situation are mostly negatively correlated with it.     

To Leave or Not to Leave: The Distribution of Bequest Motives

We examine the effect of observed and unobserved heterogeneity in the desire to die with positive net worth. Using a structural life-cycle model nested in a switching regression with unknown sample separation, we find that roughly three-fourths of the elderly single population has a bequest motive. Both the presence and the magnitude of the bequest motive are statistically and economically significant. On average, households with a bequest motive spend about 25% less on consumption expenditures. We conclude that, among the elderly single households in our sample, about four-fifths of their net wealth will be bequeathed and approximately half of this is due to a bequest motive.     

The Economic Demography Transition: Is China's ‘Not Rich,First Old’ Circumstance a Barrier to Growth?

Around 1980 China adopted a reformist economic agenda and a restrictive population policy. China's consequential ‘getting old before rich’ discourse is herein advanced into the ‘economic demography transition’ and economic demography matrix (EDM). EDM transition analysis of 182 economies from 1996 to 2016 identifies: i) China to be one of many ‘poor‐old’ economies; and ii) a majority of countries recently entering the high‐income group were first old. These results question China's 1980 s‐based fears that early demographic transition would stall development and also call for enhanced nuance in understanding economic and demographic change links.     

Fortress Europe: Jericho or Château d’If?

Traditional analysis of customs union formation suggests that it leads to an increase in members' external tariffs. This paper stresses two aspects of European trade and trade policy—a large volume of intra-industry trade between similar countries and a political motivation for tariffs—and highlights a role for tariff coordination in a model of differentiated products in which tariffs affect domestic costs and thus export prices and the magnitude of monopolistic rents. We show that when workers choose the tariffs and receive but a small portion of tariff revenues, the union's tariff wall falls.     

从"正常事件"到政治危机:理解政策失灵中有选择的政治化

并非所有的政策失灵都会引发政治危机。那么,为何会出现这样的差异呢?针对这个问题,本文从危机管理的三个视角进行了阐述,并将其运用到对两个案例的分析之中。本文认为,不同的政治化模式影响了政治危机的界定过程。     

邓小平富民思想解读

让中国人民富裕起来,使中国繁荣昌盛,是邓小平一生的追求。为此,他进行了艰辛探索和伟大实践,并逐渐形成了完整的思想体系。细细解读邓小平这一思想可以发现,这一思想的发展呈现阶段性特点,实现手段是解放生产力、发展生产力,制度基础是社会主义,而允许一部分地区、一部分人先富起来,然后达到共同富裕则是致富的基本途径。一、邓小平富民思想的产生和发展邓小平曾说,我是中国人民的儿子,我深情地爱着我的祖国和人民。他这种爱国爱民思想的具体表现之一就是力争使人民群众过上好日子。抗日战争时期,邓小平在晋冀鲁豫边区主张“应当把生产当作…     

To Commit or Not to Commit: Endogenous Timing in Experimental Duopoly Markets

In this paper we experimentally investigate the extended game with action commitment of Hamilton and Slutsky (1990, Games Econ. Behavior2, 29–46). In their duopoly game firms can choose their quantities in one of two periods before the market clears. If a firm commits to a quantity in period 1, it does not know whether the other firm also commits early. By waiting until period 2, a firm can observe the other firm's period-1 action. Hamilton and Slutsky predicted the emergence of endogenous Stackelberg leadership. Our data, however, do not confirm the theory. While Stackelberg equilibria are extremely rare, we often observe endogenous Cournot outcomes and sometimes collusive play. This is partly driven by the fact that endogenous Stackelberg followers learn to behave in a reciprocal fashion over time, i.e., they learn to reward cooperation and to punish exploitation. Journal of Economic Literature Classification Numbers: C72, C92, D43.     

Confidence or competence: Do presidencies matter for households’ subjective preferences?

This paper investigates how households form subjective preferences. We examine the relationship between subjective economic confidence or sentiments and the perception of the incumbent government's competence, and consider how preferences affect each other. We further consider consequences of different presidencies. A theoretical model shows how households ‘anchor’ subjective views of the incumbent's competence on the household's confidence. Empirical analysis confirms the posited behavior and confirms that different presidencies have a bearing on the relationship.     

Resource Curse or Not: A Question of Appropriability*

Whether natural resources are good or bad for a country's development are shown to depend on the interaction between institutional setting and, crucially, the types of resources possessed by the country. Some natural resources are, for economical and technical reasons, more likely to cause problems such as rent‐seeking and conflicts than others. This potential problem can, however, be countered by good institutional quality. In contrast to the traditional resource curse hypothesis, we show the impact of natural resources on economic growth to be non‐monotonic in institutional quality, and increasingly so for certain types of resources. In particular, countries rich in minerals are cursed only if they have low‐quality institutions, while the curse is reversed if institutions are sufficiently good. Furthermore, if countries are rich in diamonds and precious metals, these effects—both positive and negative—are larger.     

Tying the politicians’ hands: The optimal limits to representative democracy

The citizen candidate models of democracy assume that politicians have their own preferences that are not fully revealed at the time of elections. We study the optimal delegation problem which arises between the median voter (the writer of the constitution) and the (future) incumbent politician under the assumption that not only the state of the world but also the politician's type (preferred policy) are the policy‐maker's private information. We show that it is optimal to tie the hands of the politician by imposing both a policy floor and a policy cap and delegating him/her the policy choice only in between the cap and the floor. The delegation interval is shown to be the smaller the greater is the uncertainty about the politician's type. These results are also applicable to settings outside the specific problem that our model addresses.     

Demand for Redistribution: Individuals’ Responses to Economic Setbacks

Economic circumstances have been argued to be a major determining factor of attitudes toward redistribution, but there is little well‐established evidence at the individual level. The Swedish National Election Studies are constructed as a rotating survey panel, which makes it possible to estimate the causal effect of economic changes. The empirical analysis shows that individuals who lose their job become considerably more supportive of redistribution. Yet, attitudes toward redistribution return to their initial level as economic prospects improve, suggesting that the effect is only temporary. While a job loss also changes attitudes toward the political parties, the probability of voting for the left‐wing is not affected.     

eBay’s proxy bidding: A license to shill

We introduce a bidding strategy which allows the seller to extract the full surplus of the high bidder in eBay auctions. We call this a “Discover-and-Stop” bidding strategy and estimate that 1.39 percent of all bids in eBay auctions are placed by sellers (or accomplices) who execute this strategy. We argue that this kind of shill bidding is unnecessarily effective due to eBay’s proxy system and the predictability of other bidders’ bids. We also model eBay auctions with shill bidding and find that, in equilibrium, eBay’s profits are higher with shilling than without it. Finally, to determine whether bidders have an incentive to bid on their own items, we mimic the bidding behavior of shill bidders in actual eBay auctions and find some evidence of the strategy’s success.     

From theory to practice: Canadian economists’ contributions to public finance

We survey Canadian economists’ contributions to the field of public finance from the mid‐1980s to 2016. We highlight the development and extension of the models and tools of public economics and the empirical studies that have deepened our understanding of the efficiency and distributional issues over a wide range of public finance issues. We also highlight contributions to the development of policies through commissioned reports and the important role that Canadian institutions—the Canadian Tax Foundation, the think tanks and the federal and provincial departments of finance—have played in shaping tax and fiscal policies.     

The political economics of complexity : From the information economy to the ‘complexity’ economy

The economics of information allows one to distinguish within the national product the real production from the costs of organization. It reveals a continuous inflation of these costs which, per employee and since 1900, has been twice as fast as the increase of productivity. From this, one can conclude that the growth of productivity comes up against a real ‘wall’ when the costs of organization approach 50% of the national product. This is the essential cause of the present crisis. The author subsequently designs an economy of organization structures applicable to complex systems, such as physical, biological or social systems. He shows how the 50% wall is characteristic for centralized structures. Most economic structures are those where social forces and solidarities are distributed justly among all levels of organization, from local to global ones. They tend to establish themselves by self-organization, but a new political economy applying these principles would, aided by information and communication technologies, accelerate this process.     

‘Us’ and ‘Them’: the origin of identity,and its economic implications

Abstract We investigate the origins of identity and the innate proclivity to draw a distinction between ‘insiders’ and ‘outsiders’. We propose an evolutionary explanation: we argue that identity arises because it facilitates survival. In an evolutionary setting we endogenize preferences and demonstrate that the evolutionarily stable preferences fashioned by natural selection would distinguish between insiders and outsiders. We then work out the implications of such preferences in two contemporary scenarios, one entailing rent‐seeking behaviour and the other involving public good provision. Our results are in conformity with empirical evidence.