Diverse societal beliefs and redistributive policies, but equal welfare: The trade-off effect of information

Large empirical evidence shows that the difference in the political support for redistribution appears to reflect a difference in the social perceptions regarding the determinants of individual wealth and the underlying sources of income inequality. This paper presents a model of beliefs and redistribution which explains this evidence through multiple politico-economic equilibria. Differently from the recent literature which obtains multiple equilibria by modeling agents characterized by psychological biases, my model is based on standard assumptions. Multiple equilibria originate from multiple optimal levels of information for the society. Multiple optimal levels of information exist because increasing the informativeness of an economy produces a trade-off between a decrease in adverse selection and an increase in moral hazard. The framework allows to analyze various comparative statics in order to answer to policy questions

Beliefs and Redistributive Politics under Incomplete Information

The reason why the social contract is so different in two otherwise comparable societies like the United States and continental Western European countries represents a challenging question. Large empirical evidence shows that the difference in the political support for redistribution appears to reflect a difference in the social perceptions regarding the determinants of individual wealth and the underlying sources of income inequality. I present a model of beliefs and redistribution which explains this evidence through multiple politico-economic equilibria. Differently fromthe recent literaturewhich obtains multiple equilibria by modeling agents characterized by psychological biases, my model is based on standard assumptions. Multiple equilibria originate frommultiple optimal levels of information for the society. Multiple optimal levels of information exist because increasing the informativeness of an economy produces a trade-off between a decrease in adverse selection and an increase in moral hazard. The framework allows the analysis of various comparative statics in order to answer to policy questions.Politico-Economic Equilibria ; Redistribution ; Incomplete Information

Impact of Dry Granular Flows on a Rigid Wall: Discrete and Continuum Approach

Numerical simulations of impacts of granular flows with structures are complex because they have to take into account large deformations, large strain rates and interactions with boundaries or structures. Moreover, the material response is governed by interactions between grains, which leads to a complex rheology. Discrete methods (DEM), which apply a micromechanical approach, appears very well suited to this purpose, but they can hardly deal with large-scale problems. In contrasts, continuum methods can handle large granular volumes because they use a macroscopic approach in which the material behaviour is described by a constitutive model. The aim of this paper it to compare the results obtained by a discrete and a continuum approach in simulating the impact of a dry granular flow on a rigid wall. The problem is simulated with a DEM code and with a software based on the Material Point Method

Real Options and Game Theoretical Approaches to Real Estate Development Projects: Multiple Equilibria and the Implications of Different Tie-Breaking Rules

This paper contributes to a fast growing literature which introduces game theory in the analysis of real option investments in a competitive setting. Specifically, in this paper we focus on the issue of multiple equilibria and on the implications that different equilibrium selections may have for the pricing of real options and for subsequent strategic decisions. We present some theoretical results of the necessary conditions to have multiple equilibria and we show under which conditions different tie-breaking rules result in different economic decisions. We then present a numerical exercise using the in formation set obtained on a real estate development in South London. We find that risk aversion reduces option value and this reduction decreases marginally as negative externalities decrease.Game theory and real options, equilibrium selection, real estate development

Real Options and Game Theoretical Approaches to Real Estate Development Projects: Multiple Equilibria and the Implications of Different Tie-Breaking Rules

This paper builds on a fast growing literature which introduces game theory in the analysis of real option investments in a competitive setting. Specifically, in this paper we focus on the issue of multiple equilibria and on the implications that different equilibrium selections may have for the pricing of real options and for subsequent strategic decisions. We present some theoretical results of the necessary conditions to have multiple equilibria and we show under which conditions different tie-breaking rules result in different economic decisions. We then present a numerical exercise using the information set obtained on a real estate development in South London. We find that risk aversion reduces option value and this reduction decreases marginally as negative externalities decrease.game theory and real options, equilibrium selection, real estate development

Influence of Structural Stiffness on Ratcheting Convection Cells of Granular Soil under Cyclic Lateral Loading

In granular soils, long-term cyclically loaded structures can lead to an accumulation of irreversible strain by forming closed convective cells in the upper layer of the bedding. The size of the convective cell, its formation and grain migration inside this closed volume have been studied with reference to different stiffness of the embedded structure and different maximum force amplitudes applied at the head of the structure. This relation was experimentally investigated by applying a cyclic lateral force to a scaled flexible vertical element embedded in a dry granular soil. The model was monitored with a camera in order to derive the displacement field by means of the PIV technique. Furthermore, the ratcheting convective cell was also simulated with DEM with the aim of extracting some micromechanical information. The main results regarded the different development, shape and size of the convection cell and the surface settlements

Non-Existence of Competitive Equilibria with Dynamically Inconsistent Preferences

This paper shows the robust non existence of competitive equilibria even in a simple three period representative agent economy with dynamically inconsistent preferences. We distinguish between a sophisticated and naive representative agent. Even when underlying preferences are monotone and convex, we show by example that the induced preferences, at given prices, of the sophisticated representative agent over choices in first period markets are both non convex and satiated. Therefore, even allowing for negative prices, the market clearing allocation is not contained in the convex hull of demand. Finally, with a naive representative agent, we show that perfect foresight is incompatible with market clearing and individual optimization at given prices.dynamically inconsistent preferences ; competitive equilibrium ; existence ; satiation ; non convexity

Experiments and DEM Simulations of Granular Ratcheting

In this work we studied the effect of cyclic loading on a granular packing by means of numerical simulations and experiments. A confined packing of glass beads was prepared and one of the walls was moved cyclically with a prescribed amplitude of the order of the particle diameter. Different amplitudes were tested, and their effect on the free surface evolution, the force transmitted to the moving wall and the displacement patterns in the material was characterized. Discrete numerical simulations were also carried out with the specific purpose of evaluating the effect of the particle shape on the dynamics of the system. The displacement amplitude of the moving wall was shown to increase the maximum force experienced at the end of the compressive phase of the wall movement; the angularity of the particles had a similar effect. Force-wall displacement curves displayed a peculiar hysteretic behavior. The evolution of the system towards an asymptotic state was shown to be faster for spheres than for angular particles; the latter displayed an interesting long-time evolution of the force-displacement paths which deserves deeper investigations