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4
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32 views

Afriat theorem for negative goods

GARP and Afrait theorem assume that the alternative $x\in\mathbb R_+$ is always positive. In some economic contexts, such as financial choices, the attribute can be negative. I wonder if we can ...
4
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0answers
52 views

Examples of Analysis of Competition in a Latent Product Characteristic Space

Competition between firms offering heterogenous products is often an exercise of constructing the right kind of spatial model. There is the famous Hotelling model and many other papers that model ...
4
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0answers
67 views

How Africans use their wages?

I was researching poverty in Africa and was reading about their daily wages. Based on the article linked, 2/3 of Africans live on less than $1.25 USD, a day. However, what this article and many ...
4
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1answer
56 views

Markets that are linked to options prices

I recently went through a serious of lectures on economics and markets, and I was surprised by the lectures on options. The lecturer, said that the future prices of certain commodities like rice (food)...
4
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0answers
114 views

Nash equilibrium for Bertrand Model with Spatial Differentiation

Consider a town with consumers represented by a closed interval $[0,2]$ with the consumers spread continuously and uniformly. There are two stores, $A$ and $B$ who sell the same product at $p_A$ and $...
4
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0answers
65 views

Simultaneous consumption tax and subsidy

Suppose the government introduces a simultaneous tax and subsidy on a consumption good, which is produced under perfect competition. If the tax and the subsidy are equal, then there will be no ...
4
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0answers
34 views

Mechanics of Sterilized Intervention?

I'm looking to see if someone can help improve my understanding of sterilized intervention in FX markets. My intuition/understanding is: Assume that the domestic currency is depreciating, perhaps ...
4
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0answers
53 views

Existence of nash equilibria in finite games

I was going through the proof of existence of a Nash Equilibria in finite normal form games (Proof via Brouwer’s theorem) and got a question regarding the requirement of finiteness for the number of ...
4
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1answer
50 views

Negative Inflation, AS/AD framework, What Graph to use?

My macroeconomic homework contains the question below, and I'm not sure what graphs we're suppose to use to solve it. I believe I can answer the whole question using the IS-MP Diagram, but do I need ...
4
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0answers
28 views

Max Likelihood Estimators of a stable Gaussian VAR$(p)$ process. Are the Lutkepohl formulas correct?

In «New Introduction to Multiple Time Series», page 90, we have the following formulas for the ML estimators of a stable Gaussian VAR$(p)$ process: where $\tilde \alpha = vec(\tilde A_1,...,\tilde ...
4
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1answer
85 views

Insignificant Interaction effect in applied econometrics (multinomial logit regression)

I'm currently writing my master's thesis where I'm applying a multinomial logit regression with interactions effect. The model I'm using is $$ P(y=j) = exp(xb_j)/(1+∑exp(xb_h)) $$ where $$ xb_j =...
4
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0answers
106 views

Understanding the Diewertt Cost Function

The Diewert cost function (as described in Microeconomic Analysis by Hal Varian 3rd Edition) takes the form of: $$c(w,y)=y\sum_{i=1}^k\sum_{j=1}^kb_{ij}\sqrt{w_iw_j}$$ Varian goes on to say (page ...
4
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0answers
37 views

Economic valuation of green spaces using GIS

I was wondering if there are any standard methods that are employed to obtain insight of the economic value of tree cover in a particular area. I assumed using negative difference vegetation index ...
4
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0answers
160 views

Why is the symmetric grim trigger not a Nash?

Consider the stage game: Let $\delta\in(0,1)$ be the discount factor. Let $G$ be the symmetric grim trigger strategy profile. The payoffs are then $$E_{A}(G) = E_{B}(G) = \sum_{i=0}^{\infty}3\delta^{...
4
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0answers
52 views

Estimating Job Vacancy rate empirically

I'm currently reading up on matching models in terms of their ability to describe frictional unemployment, they generally follow a cobb-douglas form. $$M(u,v)=m=\mu u^\alpha v^{1-\alpha}$$ Where $M(...
4
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0answers
21 views

How did “excess liquidity” in the US contribute to the 2008 crash?

Here I'm using "excess liquidity" not in reference to monetary policy, but to the concentration of capital at the top in regard to private citizens. This excess liquidity, for which the tax cuts in ...
4
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0answers
162 views

How could the Roman sestertii/sesterces be converted into modern terms (say 2017 US$)?

Of course, the value of the sesterti must itself have fluctuated over the centuries it was in use. And so if I must narrow it down, I am particularly interested in its value during the time of ...
4
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0answers
56 views

How to econometrically identify perfect complements in production?

The production $$f(x_i,...,x_n)=\min\{x_i,...,x_n\}$$ is pretty straight forward and usually with smaller size data sets and can usually be picked up on rather quickly in an intuitive sense. ...
4
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0answers
123 views

Does a determinant ever have its own interpretation in economics?

I know there are applications of determinants in economics to compute equilibrium, aide in identifying profit maximisation/cost minimisation and in calculating elasticity of substitution. However, is ...
4
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0answers
188 views

Optimal Fight Purse and Boxing Strategies

The following is all public information available to all the players in this scenario. The General Setup In the aftermath of the infamous race between the tortoise and the hare, the salty hare went ...
4
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1answer
152 views

Can PPP adjusted values be compared over time?

I'm a little baffled about this: Let's say I want to compare the average income of 2 countries, A and B. Of course I'm interested in the real income so I adjust to PPP using the big mac index of that ...
4
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0answers
44 views

Common knowledge in model formulation and solution

Economics models usually assume that the structure of the economy is common knowledge among agents. Mathematically, an event is common knowledge if it lies in the meet of all agents' information ...
4
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0answers
319 views

Equilibrium Uniqueness in a General Equilibrium Framework

I was wondering if anyone had any insight into the conditions that lead to a unique equilibrium in an exchange economy under a general equilibrium framework. More specifically, I know that the two "...
4
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1answer
56 views

Looking for behavioral economics research about the redemption of gift cards

This is a long shot! I was wondering if anyone could point me to any behavioral economics or other economics research on perceived value, specifically I'm looking at why some people don't redeem ...
4
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0answers
190 views

Why are inventions inevitably correlated with imperfect competition?

Romer (1990) elaborates the incompatibility of nonrival inputs with constant returns to scale: If a production function depends on rival and nonrival inputs and both inputs are productive, then the ...
4
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0answers
97 views

Principal's beliefs in a repeated moral hazard problem

I have a question about models of repeated principal-agent models. There is this famous piece by Bengt Holmstrom: Moral hazard and observability, 1979, The Bell Journal of Economics. It presents the ...
4
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0answers
64 views

References on mathematically rigorous general equilibrium theories

I'm looking for a relatively recent survey on the state of the art for mathematical general equilibrium. I'm especially interested in questions of uniqueness, stability and dynamics. (I'm planing on ...
4
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0answers
151 views

Did a similar property boom take place in another country or throughout history like we have seen in London? If so how did it effect the economy?

The London property market has seen a sharp increase in the average house price. If we go back to the 70's the average UK and average London price were almost the same, however since than the gap has ...
4
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0answers
241 views

On the uniqueness of utility functions for both risk and time

I have a question regarding the uniqueness of preference functionals under risky and dynamic settings. Two well known models to represent preferences for both settings are the Expected Utility Model ...
4
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0answers
116 views

Regional disaggregation of a national input-output table

I am trying to disaggregate a "national" input-output table into three regions using Simple Location Quotients (SLQs) and RAS balancing. In particular, I'm trying to use the "Two region logic with ...
4
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0answers
167 views

Dynamic demand model in many good competitive markets and price optimization

This is a question about demand models, price optimization, dynamic pricing, big data, online learning, so I will cross-post in other communities. $\mathbf{Background}$ I am interested in dynamic ...
4
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0answers
40 views

Reading list: Housing Economics

Hi Im looking for some books or articles or books on the basics of housing economics. Where should I start?
4
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0answers
63 views

Don't let me take the last bit

I believe everyone has experienced something like the following once in her or his life : There is a cake on the table and three people to share it. The three people each eat a quarter of the cake. ...
4
votes
1answer
515 views

Implications of declining money velocity

In the United States, the velocity of both the M1 and M2 money supplies has been declining for over a decade. The decline in the velocity of M1 could be explained by the shift away from cash to cards ...
4
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0answers
157 views

Social Choice: from Independence axiom to Mixture symmetry axiom

Harsanyi's Utilitarian theorems' has been criticized by Diamond Cardinal Welfare, Individualistic Ethics, and Interpersonal Comparison of Utilities and others that, it is the morally unacceptable for ...
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0answers
56 views

Segal (2000) question about utility opportunity set

I am reading a JPE paper "Let's agree all dictatorship are equally bad" from Uzi Segal (2000). I have a small problem with this paper. We have the following Utility Opportunity Set (UOS): $$ S(w)=\{...
4
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0answers
797 views

Corner Solutions for Pareto Efficiency

I have been reviewing calculations to find walrasian equilibrium and pareto efficient allocations. Assume we are in an environment with two consumers, $A$ and $B$, and two goods, $x$ and $y$. From ...
4
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0answers
46 views

Taking a mechanism as given, what goal functions can we implement?

Let $\theta_i$ be $i$'s private information about the state of the world, $\theta \in \Theta$, where $\theta = \times_i \theta_i$. Each agent reports $\hat{\theta_i}$ to a social planner, so that $\...
4
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0answers
28 views

Estimates of the global STEM workforce?

I am looking for any recent estimates of the global STEM workforce (STEM = Science Technology Engineering Mathematics, and ideally includes software engineers). Time series data would be even better, ...
4
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0answers
71 views

R reproducible example, restrictions on cointegrating equations

The code given below estimates a VEC model with 4 cointegrating vectors. It is a reproducible code, so just copy and paste into your R console (or script editor). ...
4
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0answers
49 views

Test data for repeat sales indices

I'm interested in calculating a repeat sales index like that of Case and Shiller (1987) or Bailey, Muth and Nourse (1963). While I believe I have a handle on the econometrics, to test my ...
4
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0answers
230 views

Explanation of paper's econometric assumptions

The authors of this paper (http://andrewleigh.org/pdf/GunBuyback_Panel.pdf) appear to be essentially regressing the change in the death rate to the change in guns from a gun buy back in Australia, at ...
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0answers
4k views

Difference between embodied and commanded labor in the Labor Theory of Value?

Could the difference between "labor embodied" (production cost in labor value) and "labor commanded" (selling price in labor value) as described in the labor theory of value be attributable to the ...
4
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3answers
1k views

Relationship between Real Interest Rate and Employment

The country of Kingsland is considering the introduction of a compulsory retirement saving scheme. Under this scheme all workers are required to save ten per cent of their annual wages and ...
4
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0answers
148 views

Econometrics: Weights in regression that contains averages

Let's say I have a regression of the form: $$y_j=a_0+a_1*T_j+a_2*X_j+u_j$$ where $j$ stands for county, and $y$ and $X$ are averages over worker outcomes/characteristics for each county, and $T$ is ...
4
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0answers
75 views

How does real GDP take into account technological advancement?

I'm asking this question, since it was not explained in my textbook and since I couldn't find the answer in Internet. For example, 1 TB HDD costs 50 dollars now, and 100 GB HDD costed 50 dollars in ...
4
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0answers
2k views

Multiplier in the two-sector Keynesian model

Which of the following is most likely to reduce the size of the multiplier in the simple (2-sector) Keynesian model? Increased taxes on savings Reduced access to government funded medical care ...
4
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0answers
53 views

Non parametric and parametric tests of martingale?

A martingale is a model in which the expectation for the next value is equal to the presently observed value, even given knowledge of prior values, ie $E(X_{n+1} |X_1, X_2, ..,X_n)=X_n$ What tests ...
4
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0answers
210 views

What is the proper term for the “meta-value” of an object?

For instance, say I have a roll of quarters and a roll of dimes. I can use the dimes and quarters in a parking meter, but 50 cents in dimes gets me less time than 50 cents in quarters. Additionally, I ...
4
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0answers
56 views

How exactly do Participatory Notes induce volatility into the economy?

I was reading up on participatory notes. Wikipedia defines these as "instruments issued by registered foreign institutional investors (FII) to overseas investors, who wish to invest in the Indian ...

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