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Lemons and Peaches: A (Robust) Multi-stage Buying Mechanism with Multiple Applications
(2019)CEPR Discussion PapersWe introduce a four-stage, multi-price buying mechanism, which can be used by a (big) buyer to separate low-quality sellers - called "lemon" owners - from high-quality sellers - called "peach" owners. With a partition of sellers, the buyer obtains the commodities from the "peach" owners at a price that matches the willingness to sell. By contrast, "lemon" owners are trapped into selling their items at a low, or even negligible, price. Our ...Working Paper -
Politsplaining: Populism Breeds Populism
(2019)CEPR Discussion PapersWe suggest a particular notion of populism. A populist is a politician who engages in so-called "politsplaining": He explains complex developments and assigns weights to potential causes and potential remedies as it best suits his objectives. We present a simple model of politsplaining in which two candidates compete for office. The income of citizens is affected by two shocks (say automation and globalization), but citizens only observe ...Working Paper -
Technology Treaties and Climate Change
(2019)CEPR Discussion PapersWe introduce an international technology treaty ("Tech Treaty") that couples the funding of research for a more advanced abatement technology with an international emissions permit market. While each country decides on domestic permit issuance, a fraction of these permits is auctioned by an international agency. Auction revenues scale up license revenues for the innovators of abatement technologies. We show that such a treaty increases ...Working Paper -
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The Effect of Handicaps on Turnout for Large Electorates: An Application to Assessment Voting
(2019)CEPR Discussion PapersWe analyze the effect of handicaps on turnout. A handicap is a difference in the vote tally between alternatives that strategic voters take as predetermined when they decide whether to turn out for voting. Handicaps are implicit in many existing democratic procedures. Within a costly voting framework with private values, we show that turnout incentives diminish considerably across the board if handicaps are large, while low handicaps yield ...Working Paper -
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Untimely Destruction: Pestilence, War and Accumulation in the Long Run
(2019)IZA Discussion Paper SeriesWorking Paper -
From Local to Global: A Unified Theory of Public Basic Research
(2019)SSRNWe analyze public investment in basic research in a multi-country, multiindustry environment with international trade. In our economy, basic research generates ideas which private rms take up in applied research to develop new varieties. Such development requires industry-speci c know-how. A country's current specialization in international trade thus determines which ideas can be commercialized domestically. We demonstrate that the ...Working Paper