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1500 questions
9
votes
3 answers
Why do low-budget films charge the same amount at the box office as super-high budget films?
In most occurrences, lower production costs translate into lower sales costs. Obviously there are other factors that influence price, including perceived value (affected by advertising), monopolies, and so on.
However there are many companies that…
JSideris
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8
votes
4 answers
How is Singapore able to provide first-world public services, given its low income tax rate?
Singapore has a relatively low personal income tax rate. Somebody who earns $80,000 after deductions only pay 3,350 in taxes, or about 4% effective rate (see 2012-2016 tax table). 80,000 is already well above the gross median income in Singapore,…
user69715
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8
votes
1 answer
Show that $W_t - \int_0^t \xi_s ds$ is forward-measure-Brownian
Definitions and stuff:
Consider a filtered probability space $(\Omega, \mathscr F, \{\mathscr F_t\}_{t \in [0,T]}, \mathbb P)$ where
$$T > 0$$
$$\mathbb P = \tilde{\mathbb P}$$
This is risk-neutral measure.
$$\mathscr F_t = \mathscr F_t^{{W}} =…
BCLC
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8
votes
4 answers
Fair and efficient allocation of "family goods"
Consider an exchange economy with two goods, e.g. home furniture (x) and electrical equipment (y). The interesting thing about these goods is that, when a family owns a bundle, all members of the family enjoy the same bundle (it is like a "club…
Erel Segal-Halevi
- 3,065
- 3
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8
votes
2 answers
Utility function types - request for review
I am working on a Wikipedia page that compares several common utility functions. Although I found some information about these topics on the web, I didn't find it all in one place, and often got confused by the different terms. I will be happy for…
Erel Segal-Halevi
- 3,065
- 3
- 15
- 36
8
votes
4 answers
Has the world become poorer?
This question is not backed by serious economic research but mainly by a very simple attempt to look at how the world economy has changed.
I am asking whether and why the world has, over the past 50 or so years, become less productive (not used in…
fishlein
- 191
- 3
8
votes
1 answer
A timeline on the the key achievements of Economics and its evolution
Something I've never seen in Economics but have in Maths and Chemistry and really enjoyed is that when I took it we got to the see the evolution of the science (and yes Economics is a [social] science ) showing us the very building blocks and the…
Ivan
- 257
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8
votes
4 answers
Can absence of inflation be accounted for by a reconfigured class structure?
A previous and oft-heard question asked why no inflation results from the Fed pumping money into the economy.
Are we simply seeing a methodical wage suppression, thus no official "inflation," while prices soar in certain sectors dominated by…
Nelson Alexander
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8
votes
2 answers
Will high computing power substitute the certainty-equivalence assumption?
Bloom in a recent JEP paper considers that "the increase in computing power has made it possible to include uncertainty shocks directly in a wide range of models, allowing economists to abandon assumptions built on “certainty equivalence,” which…
emeryville
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8
votes
1 answer
What is the difference between Stochastic game and Bayesian game ?
I was studying definitions of Stochastic and Bayesian game and it appears that Stochastic game is a generalized form of Bayesian game. Could anybody please explain the fundamental differences between Stochastic game and Bayesian game and imperfect…
Sub-Optimal
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8
votes
1 answer
Gale-Shapley Follow-up Literature and General Questions
The Gale-Shapley Algorithm is a way of matchmaking between two different entities of people. It guarantees that every individual player is matched and that the matches are stable.
What sort of literature has been done building off of this? How does…
Kitsune Cavalry
- 6,628
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8
votes
2 answers
Relationship between strong and weak axioms of revealed preference
I keep seeing these following facts just asserted while reading:
Let W = weak axiom of revealed preference
Let S = strong axiom of revealed preference
Let C = the commodity vector
$W \iff S$ when $C \in R^2$
$W \not\to S$ when $C \in R^i,…
guest123456789
- 121
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8
votes
1 answer
Why would a cash-rich company borrow money?
I have read that Apple Computer issues corporate bonds.
Considering that it has $200 billion in cash, and the company complains it has been unable to spend its enormous amount of cash, why would they be issuing corporate bonds?
Lassie Fair
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8
votes
4 answers
Nash equilibrium of a Bertrand game with different marginal costs
Consider the following game of Bertrand (price competition):
There are two players, $1$ and $2$. Each has a publicly known marginal cost, $c_i$.
A strategy is a price, $p_i\in\mathbb{R}$.
Player $i$'s payoff (profit) is $\pi(p_i,p_j)=p_i-c_i$ if…
Ubiquitous
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8
votes
4 answers
Why couldn't the Karush-Kuhn-Tucker optimization find the solution?
I have the following utility maximization problem:
$$\max (xy)$$
$$(x+y-2)^2 \leq 0$$
Conditions:
$$y-2\lambda (x+y-2) =0$$
$$x-2\lambda (x+y-2) =0$$
$$\lambda(x+y-2)^2=0$$
When I set $\lambda>0$, I get:
$$(x+y-2)^2=0 \Rightarrow (x+y-2) =…
Übel Yildmar
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