Excess entry, ambiguity seeking and competence: An experimental investigation

Excess entry refers to the high failure rate of new entrepreneurial ventures. Economic explanations suggest 'hit and run' entrants and risk-seeking behavior. A psychological explanation is that people (entrepreneurs) are overconfident in their abilities (Camerer & Lovallo, 1999). Characterizing entry decisions as ambiguous gambles, we alternatively suggest–following Heath and Tversky (1991)–that people seek ambiguity when the source of uncertainty is related to their competence. Overconfidence, as such, plays no role. This hypothesis is confirmed in an experimental study that also documents the phenomenon of reference group neglect. Finally, we emphasize the utility that people gain from engaging in activities that contribute to a sense of competence. This is an important force in economic activity that deserves more explicit attention.Competence, excess entry, entrepreneurship, overconfidence, Leex

Reforming the US Corporate Tax

The mainstay of federal business taxation, the US corporate income tax, is riddled with distortions and inequities. As a means of taxing the richest Americans--a popular goal--the corporate income tax is a hopeless failure. Many companies pay no corporate tax, and among those that do, the burden is highly uneven. Meanwhile, the richest Americans command income from numerous sources besides corporate dividends. The distortions and inequities are amazing. Under pressure from business lobbies, Congress legislates deductions and exemptions that twist the corporate tax base far from any plausible financial definition; then Congress enacts "targeted" tax credits to carry out ersatz industrial policies. Faced with a tax terrain of mountains and ravines, corporations employ armies of lawyers and accountants to devise avoidance strategies. This book proposes to replace the corporate income tax with a tax that has a much broader base at a much lower rate. Two alternatives are explored: the National Retail Sales Tax (NRST) and the Corporate Activity Tax (CAT). To address the issue of regressivity, both alternatives are coupled with measures to preserve the real spending power of households at the lowest income levels.

Chemical evolution of the Galactic bulge: different stellar populations and possible gradients

We compute the chemical evolution of the Galactic bulge to explain the existence of two main stellar populations recently observed. After comparing model results and observational data we suggest that the old more metal poor stellar population formed very fast (on a timescale of 0.1-0.3 Gyr) by means of an intense burst of star formation and an initial mass function flatter than in the solar vicinity whereas the metal rich population formed on a longer timescale (3 Gyr). We predict differences in the mean abundances of the two populations (-0.52 dex for ) which can be interpreted as a metallicity gradients. We also predict possible gradients for Fe, O, Mg, Si, S and Ba between sub-populations inside the metal poor population itself (e.g. -0.145 dex for ). Finally, by means of a chemo-dynamical model following a dissipational collapse, we predict a gradient inside 500 pc from the Galactic center of -0.26 dex kpc^{-1} in Fe.Comment: 9 pages, 9 figures, accepted for publication in Section 5. of Astronomy and Astrophysic

Legitimate Punishment, Feedback, and the Enforcement of Cooperation

In real life, punishment is often implemented only insofar as punishers are entitled to punish and punishees deserve to be punished. We provide an experimental test for this principle of legitimacy in the framework of a public goods game, by comparing it with a classic (unrestricted) punishment institution. A significant advantage of our institution is that it rules out antisocial punishment, a phenomenon which recent studies document to play a key role in undermining the scope for self-governance. Our findings show that, despite the lack of additional monetary incentives to cooperate, the introduction of legitimate punishment leads to substantial efficiency gains, in terms of both cooperation and earnings. Therefore, in businesses and other organizations, this device could successfully deal with the principal-agent problem, with the principal delegating a task to a team of agents. Further, we interestingly find that removing the information over high contributors’ choices only leads to a dramatic decline in cooperation rates and earnings. This result implies that providing feedback over virtuous behavior is necessary to make an institution based on legitimate punishment effective.Experimental Economics, Public Good Games, Costly Punishment, Cooperation, Legitimacy, Immunity

Senator Kerry on Corporate Tax Reform: Right Diagnosis, Wrong Prescription

Senator John Kerry has proposed a major overhaul in corporate taxation, with the goal of persuading multinational companies (MNCs) to employ more workers at home and fewer abroad. Kerry has correctly emphasized that domestic production is often taxed at a higher rate than production abroad, but his prescriptions will not boost US jobs.

Chemical evolution of the Galactic Center

In recent years, the Galactic Center (GC) region (200 pc in radius) has been studied in detail with spectroscopic stellar data as well as an estimate of the ongoing star formation rate. The aims of this paper are to study the chemical evolution of the GC region by means of a detailed chemical evolution model and to compare the results with high resolution spectroscopic data in order to impose constraints on the GC formation history.The chemical evolution model assumes that the GC region formed by fast infall of gas and then follows the evolution of alpha-elements and Fe. We test different initial mass functions (IMFs), efficiencies of star formation and gas infall timescales. To reproduce the currently observed star formation rate, we assume a late episode of star formation triggered by gas infall/accretion. We find that, in order to reproduce the [alpha/Fe] ratios as well as the metallicity distribution function observed in GC stars, the GC region should have experienced a main early strong burst of star formation, with a star formation efficiency as high as 25 Gyr^{-1}, occurring on a timescale in the range 0.1-0.7 Gyr, in agreement with previous models of the entire bulge. Although the small amount of data prevents us from drawing firm conclusions, we suggest that the best IMF should contain more massive stars than expected in the solar vicinity, and the last episode of star formation, which lasted several hundred million years, should have been triggered by a modest episode of gas infall/accretion, with a star formation efficiency similar to that of the previous main star formation episode. This last episode of star formation produces negligible effects on the abundance patterns and can be due to accretion of gas induced by the bar. Our results exclude an important infall event as a trigger for the last starburst.Comment: 10 pages, 8 figures, accepted for publication in MNRA

Il ruolo dell’autonomia della volontà nei regolamenti sui rapporti patrimoniali tra coniugi e sugli effetti patrimoniali delle unioni registrate. Alcune considerazioni sul coordinamento tra il regime giuridico stabilito dai nuovi regolamenti e altri st

 Abstract: The new Regulations (No. 2016/1103 and No. 2016/1104) recently adopted through an enhanced cooperation by the European Legislator aim to deal with all the private international law aspects of matrimonial property regimes and property consequences of registered partnerships, both as concerns the daily management of matrimonial property (or partner’s property) and its liquidation, in particular as a result of the couple’s separation or the death of one of the spouses (or partners). This paper aims to address the prominent role of party autonomy in the two Regulations and to focus on the coordination between the legal system embodied in the new two Regulations, and other relevant instruments of European private international law in force, such as the Succession Regulation and the Bruxelles II- bis Regulation. Keywords: party autonomy; successions; matrimonial property regime, partnership property regi­me, applicable law, choice of law, private international law. Riassunto: I due nuovi regolamenti (No. 2016/1103 e No. 2016/1104), recentemente adottati nell’ambito di una cooperazione rafforzata dal legislatore europeo, si propongono di regolare tutti gli aspetti internazional privatistici legati ai regimi patrimoniali tra coniugi e alle conseguenze patrimoniali delle partnership registrate, sia per ciò che concerne la regolare amministrazione dei beni sia per ciò che riguarda la liquidazione degli stessi beni facenti parte del regime matrimoniale (o della partnership regi­strata) nel caso si verifichino vicende che ne alterino il normale svolgimento, come la separazione della coppia o la morte di uno degli sposi (o dei partner). Il presente scritto si propone di esaminare il ruolo prominente che, all’interno di entrambi i regolamenti, è riservato alla volontà delle parti e di focaliz­zarsi sul coordinamento tra i due nuovi strumenti e gli altri regolamenti di diritto internazionale privato europeo attualmente in vigore e, particolarmente, il regolamento sulle successioni transfrontaliere e il regolamento Bruxelles II- bis Parole chiave: autonomia della volontà; successioni; rapporti patrimoniali tra coniugi; effetti pa­trimoniali delle unioni registrate; legge applicabile; scelta di legge; diritto internazionale privato.The new Regulations (No. 2016/1103 and No. 2016/1104) recently adopted through an enhanced cooperation by the European Legislator aim to deal with all the private international law aspects of matrimonial property regimes and property consequences of registered partnerships, both as concerns the daily management of matrimonial property (or partner’s property) and its liquidation, in particular as a result of the couple’s separation or the death of one of the spouses (or partners). This paper aims to address the prominent role of party autonomy in the two Regulations and to focus on the coordination between the legal system embodied in the new two Regulations, and other relevant instruments of European private international law in force, such as the Succession Regulation and the Bruxelles II- bis Regulation.I due nuovi regolamenti (No. 2016/1103 e No. 2016/1104), recentemente adottati nell’ambito di una cooperazione rafforzata dal legislatore europeo, si propongono di regolare tutti gli aspetti internazional privatistici legati ai regimi patrimoniali tra coniugi e alle conseguenze patrimoniali delle partnership registrate, sia per ciò che concerne la regolare amministrazione dei beni sia per ciò che riguarda la liquidazione degli stessi beni facenti parte del regime matrimoniale (o della partnership regi­strata) nel caso si verifichino vicende che ne alterino il normale svolgimento, come la separazione della coppia o la morte di uno degli sposi (o dei partner). Il presente scritto si propone di esaminare il ruolo prominente che, all’interno di entrambi i regolamenti, è riservato alla volontà delle parti e di focaliz­zarsi sul coordinamento tra i due nuovi strumenti e gli altri regolamenti di diritto internazionale privato europeo attualmente in vigore e, particolarmente, il regolamento sulle successioni transfrontaliere e il regolamento Bruxelles II- bis