How does the structure of an organization affect corruption? This paper analyzes a model that views organizations as networks on which coalitions of corrupt accomplices may form. This network approach to corruption provides new insights into the problem: (i) corruption will arise in enclaves, i.e. coalitions that minimize joint exposure to witnesses, (ii) making the organization more connected may increase corruption, and (iii) corruption will involve larger coalitions under better monitoring. Simulation results also suggest that more hierarchical organizations are more corrupt than flatter organizations. I test these predictions in the lab. Results confirm the predictions and reveal a systematic deviation that has implications for why better monitoring reduces corruption: participants disproportionately fail to realize larger coalitions, which are more necessary under good monitoring. Results suggest it would be sensible to redesign public agencies to puncture the isolation of enclaves.
We investigate how asymmetric information on final demand affects strategic interaction between a downstream monopolist and a set of upstream monopolists, who independently produce complementary inputs. We study an intrinsic private common agency game in which each supplieriindependently proposes a pricing schedule contract to the assembler, specifying the supplier's payment as a function of the assembler's purchase of inputi. We provide a necessary and sufficient equilibrium condition. A lot of equilibria satisfy this condition but there is a unique Pareto-undominated Nash equilibrium from the suppliers' point of view. In this equilibrium, there are unavoidable efficiency losses due to excessively low sales of the good. However, suppliers may be able to limit these distortions by implicitly coordinating on an equilibrium with a rigid (positive) output in bad demand circumstances.
This paper provides experimental support for the hypothesis that insurance can be a motive for religious donations. We randomize enrollment of members of a Pentecostal church in Ghana into a commercial funeral insurance policy. Then church members allocate money between themselves and a set of religious goods in a series of dictator games with significant stakes. Members enrolled in insurance give significantly less money to their own church compared to members that only receive information about the insurance. Enrollment also reduces giving towards other spiritual goods. We set up a model exploring different channels of religiously based insurance.
The implications of the model and the results from the dictator games suggest that adherents perceive the church as a source of insurance and that this insurance is derived from beliefs in an interventionist God. Survey results suggest that material insurance from the church community is also important and we hypothesize that these two insurance channels exist in parallel.
While payoff-based learning models are almost exclusively devised for finite action games, where players can test every action, it is harder to design such learning processes for continuous games. We construct a stochastic learning rule, designed for games with continuous action sets, which requires no sophistication from the players and is simple to implement: players update their actions according to variations in own payoff between current and previous action. We then analyze its behavior in several classes of continuous games and show that convergence to a stable Nash equilibrium is guaranteed in all games with strategic complements as well as in concave games, while convergence to Nash equilibrium occurs in all locally ordinal potential games as soon as Nash equilibria are isolated.
This paper provides an empirical assessment of the effect of income inequality on credit dynamics in 12 advanced economies over the period 1948–2015. We use foreign Communist influence as an instrument to identify exogenous variation in inequality and estimate the dynamic effect of a top income shock on credit over GDP. The results suggest that the evolution of top incomes has persistent effects on credit expansion, especially for mortgage and business loans.
This paper analyzes the link between asset bubbles, endogenous labor and capital. First, we explicitly and theoretically derive the conditions to have a crowding-in effect of the bubble, i.e. higher levels of capital and labor. Second, the utility function we consider shows that this result does not require an arbitrarily high elasticity of intertemporal substitution in consumption.
Les communs, dont les racines historiques sont lointaines, ont toujours prouvé, au fil du temps, leur efficacité comme mode d'action collective et solidaire et sont aujourd'hui une réalité incontournable de ce début du XXIe siècle. Ils manifestent la volonté d'un nombre croissant de citoyens de reprendre la main sur leur destin, à l'heure où les grands centres de décision s'éloignent de leur vie quotidienne dans les contingences de la mondialisation économique et financière.
Un commun, c'est un mode d'action collective autour d'une ressource partagée, pour la gérer efficacement au bénéfice de chacun et la préserver contre la dégradation ou une appropriation abusive. On trouve des communs dans une très grande variété de domaines : ressources naturelles et foncières, cognitives, sociales, urbaines... Des jardins partagés à Wikipedia, des AMAP aux monnaies locales, les initiatives collaboratives se multiplient. Les communs ne sont pas, comme certains de leurs détracteurs les qualifient, une naïve utopie débouchant sur une indescriptible pagaille dans laquelle chacun n'agirait qu'en fonction de son intérêt propre. Un commun, c'est aussi une gouvernance s'appuyant sur une structure et un système de règles, produites collectivement et acceptées par tous avec, pour chacun, des rôles différenciés en termes de droits et de responsabilités.
Cet ouvrage a été rédigé avant la pandémie de la Covid-19. Or, par-delà le repli sur soi et la peur de l'autre, la crise sanitaire a aussi donné lieu à de magnifiques initiatives de solidarité et d'action collective. Elle a rappelé à quel point la problématique des communs, qui ouvre une troisième voie, hors de la dualité État/marché, est plus que jamais d'actualité. Ce livre propose une analyse des fondements du phénomène et de la variété de ses manifestations. Il interroge sur la question de savoir dans quelle mesure les communs peuvent constituer un moteur de transformation profonde de nos sociétés.
Measuring Economic Growth and Productivity is not only a book on an essential topic, namely that of "growth and productivity", it is also a fabulous ensemble, bringing together contributions from many top specialists. But, in addition, it is a tribute to Dale W. Jorgenson, who has for decades been an exceptional contributor to gaining a better knowledge of the mechanisms of growth and productivity. The volume is dedicated to him. I was present in January 2020 at the annual IPM dinner at the AEA conference, when a preprint of the book was presented to him by the editor, Barbara Fraumeni. I openly admit that it was a very emotional moment.
Intermediary organisations have increasingly played a role in payments for agri-environment services across Europe over the last two decades. However, the economics literature has so far not examined the impact of this new governance mechanism on environmental protection and on individuals' behaviour. We develop a new theoretical economic framework to compare an incentive mechanism using intermediaries, such as environmental knowledge brokers and information providers, with a standard central governance mechanism, in terms of environmental impact. We show that the emergence of knowledge intermediaries is particularly effective where farmers initially have low environmental awareness, or when the public institution organising the scheme is insufficiently aware of individuals' characteristics. Our findings provide theoretical support for previous empirical results on payment schemes for agri-environment measures.