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Articles 1 - 7 of 7
Full-Text Articles in Social and Behavioral Sciences
2023-1 The Macroeconomic Consequences Of Subsistence Self-Employment, Juan Herreno, Sergio Ocampo
2023-1 The Macroeconomic Consequences Of Subsistence Self-Employment, Juan Herreno, Sergio Ocampo
Department of Economics Research Reports
We evaluate the aggregate effects of expansions of credit supply in environments where subsistence self-employment is prevalent. We extend a standard macro development model to include unemployment risk, which becomes a key driver of selection into self-employment. The model is consistent with the joint distribution of earnings and occupations, the reaction of wages to labor demand shocks, and the small effects of expansions in the supply of microloans on the earnings of the self-employed. We find that the elasticity of aggregate output to expansions in credit supply is proportional to the elasticity of individual earnings. This proportionality arises due to …
2023-2 Dynamic And Stochastic Rational Behavior, Nail Kashaev, Charles Gauthier, Victor H. Aguiar
2023-2 Dynamic And Stochastic Rational Behavior, Nail Kashaev, Charles Gauthier, Victor H. Aguiar
Department of Economics Research Reports
We analyze consumer demand behavior using Dynamic Random Utility Model (DRUM). Under DRUM, a consumer draws a utility function from a stochastic utility process in each period and maximizes this utility subject to her budget constraint. DRUM allows unrestricted time correlation and cross-section heterogeneity in preferences. We fully characterize DRUM for a panel data of consumer choices and budgets. DRUM is linked to a finite mixture of deterministic behavior represented as the Kronecker product of static rationalizable behavior. We provide a generalization of the Weyl-Minkowski theorem that uses this link and enables conversion of the characterizations of the static Random …
2023-3 Dynamic Programming For Pure-Strategy Subgame Perfection In An Arbitrary Game, Peter Streufert
2023-3 Dynamic Programming For Pure-Strategy Subgame Perfection In An Arbitrary Game, Peter Streufert
Department of Economics Research Reports
This paper uses value functions to characterize the pure-strategy subgame-perfect equilibria of an arbitrary, possibly infinite-horizon game. It specifies the game’s extensive form as a pentaform (Streufert 2023p, arXiv:2107.10801v4), which is a set of quintuples formalizing the abstract relationships between nodes, actions, players, and situations (situations generalize information sets). Because a pentaform is a set, this paper can explicitly partition the game form into piece forms, each of which starts at a (Selten) subroot and contains all subsequent nodes except those that follow a subsequent subroot. Then the set of subroots becomes the domain of a value function, and the …
2023-5 History Of Economic Thought's Place In Macroeconomics Revisited, David Laidler
2023-5 History Of Economic Thought's Place In Macroeconomics Revisited, David Laidler
Department of Economics Research Reports
The History of Economics Society was founded at a time when the History of Economic Thought was being expelled from the Economics post-graduate curriculum in many universities, and was one of the key institutions around which the sub-discipline successfully re-organised itself and continued to develop. Laidler (2003) argued that Economics itself, especially Macroeconomics, was suffering serious damage from this expulsion. It has continued to do so since.
2023-01 The Insurance Implications Of Government Student Loan Repayment Schemes, Martin Gervais, Qian Liu, Lance Lochner
2023-01 The Insurance Implications Of Government Student Loan Repayment Schemes, Martin Gervais, Qian Liu, Lance Lochner
Centre for Human Capital and Productivity. CHCP Working Papers
No abstract provided.
2023-02 Adverse Selection Among Early Adopters And Unraveling Innovation, Rory Mcgee
2023-02 Adverse Selection Among Early Adopters And Unraveling Innovation, Rory Mcgee
Centre for Human Capital and Productivity. CHCP Working Papers
I provide an equilibrium analysis of “selection markets”: where consumers not only vary in how much they are willing to pay, but also in how much they cost to the seller. The model provides a joint explanation for three empirical phenomena: low uptake of existing products, slow demand for new products, and market inactivity despite unmet demand. I characterize when early adopters are more adversely selected in new markets. This lowers demand, increases costs, and leads markets to unravel prematurely. With endogenous market entry for new products (e.g., reverse mortgages, annuities), extended patents serve as de facto time-varying subsidies.
2023-4 Macro’S Missing Link: The Unbridged Gap Between Monetarism And The Wicksell Connection, David Laidler
2023-4 Macro’S Missing Link: The Unbridged Gap Between Monetarism And The Wicksell Connection, David Laidler
Department of Economics Research Reports
Modern mainstream macroeconomics treats the economy “as if” always in equilibrium. Two older traditions, Monetarism and the Wicksell Connections have always dissented, arguing that how agents gather information and apply it to the coordination of their activities are prior problems requiring attention before equilibrium can, or cannot, be assumed. They have developed the implications of this claim along different lines, however, with the former dealing with questions raised by the existence of monetary exchange in general and the latter concentrating in particular on inter-temporal issues. This gap has persisted since Wicksell opened it up, and has never been satisfactorily bridged: …