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1500 questions
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Convex hull operator in the definition of rationalizable strategies
In Game Theory by Fudenberg and Tirole, they define the set of rationalizable strategies in the following way.
Definition 2.3 in FT: Set $\tilde{\Sigma}_{i}^{0}=\Sigma_{i}$ where $\Sigma_{i}$ is the space of mixed strategies for player $i$. For…
John
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Does a monotonic transformation of a homothetic utility function imply the preference relation on the set of consumption bundles is still homothetic?
Does a monotonic transformation of a homothetic utility function imply the preference relation on the set of consumption bundles is still homothetic?
Obviously, if a utility function on a set of consumption bundles is homothetic, then the…
Stan Shunpike
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7
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How does buying/selling houses affect the GDP?
Suppose I buy a house and sell it off in the same year for the same price, would the GDP for that year increase by twice the value of the house, or only once, or not at all?
Axel Boldt
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Is elasticity purely an aggregate concept or can it be individualized
First question here. I am not an economist by training, but I do quite a bit of econometric analysis in my job (my background is maths). I often get asked about elasticity, and I am familiar with several different ways of calculating elasticity. …
Paul
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7
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Models for online markets with reputation system
The only relevant model I'm aware of is Liu Qingmin(2011 R.E.S). Is there any other decent models dealing with the mechanism of online markets under reputation system, and perhaps linking to regulation?
Metta World Peace
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Deriving formulas from Gali's book on the New Keynesian model
I've found this link with all the derivations from Gali's book on New Keynesian model.
In page 13, eq. $(3.7)$, the author derives the optimal price-setting rule $P_t^*$ by a representative firm that solves an intertemporal profit maximization…
An old man in the sea.
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2 answers
Are there any behavioral macro models with rigorous micro-foundations?
I am looking for some paper that tries to establish rigorous micro-foundations the behavioral New Keynesian (or any other) macro models.
This is surprisingly hard, most work on this topic (like De Grauwe 2012), simply starts already by setting up IS…
1muflon1
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7
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Can A Utility Function Take On Negative Values?
Can someone provide a rigorous definition of a utility function? I had thought that a utility function only needs to the preserve the order of preferences. Thus a utility function can take on negative values as long as it preserves the order of…
Tony Bui
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Graduate Level Textbook on Labor Economics and Macro-Labor
What would be good textbooks at the graduate level that deal with Labor Economics and Labor-Macro (As in, Equilibrium Unemployment Theory, Shimer Puzzle etc)?
FooBar
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Incidental Parameters and Poisson Regression
Consider:
$\ln(E[Y|X])=X_{it}'\beta+\alpha_i$ and thus $E[Y|X]=e^{X_{it}'\beta+\alpha_i}$.
We can write this regression model as:
$$Y_{it} =e^{X_{it}'\beta+\alpha_i}\eta_{it} $$
For which the contemporaneous exogeneity assumption is…
Michael Gmeiner
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What are the pros and cons of eliminating corporate taxes?
I recently heard a story on npr about economic policy changes that both liberal and conservative economists definitively agree on. Among other things, complete elimination of corporate taxes was mentioned.
I'm curious to know more about what the…
Paul
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7
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2 answers
Could a Cap-and-Trade and a Carbon Tax both work together as a system to reduce carbon emissions?
For example, the European Union currently has a Carbon Emissions Trading Scheme in progress the ETS which acts to cap the amount of carbon dioxide released by large corporations. However, let us imagine, for example that the UK implements a carbon…
AlexLipp
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7
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Intuition behind Euler Lagrange equation in economics
When being exposed to the concept of the Euler Lagrange equation as a mathematical concept, many ideas from the physical sciences are used to explain its relevance in terms of choice of shortest path, brachistochrone problem which are great for…
EconJohn
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7
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2 answers
The economic impact of corruption
I know nothing about the 'economics of corruption' literature, whether in the medium(fluctuations) or long-run(growth)... Although I've found many surveys (mostly +5 years, and from journals I don't recognize), since I known nothing about this…
An old man in the sea.
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7
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Small Open Economy Without Government
Suppose we have an economy with a representative consumer with the following utility function: $$U=\sum_{t=0}^\infty\beta^t\frac{c_t^{1-\sigma}}{1-\sigma} $$ There is no uncertainty and the household can invest in a single risk-free asset bearing a…
Maybeline Lee
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