Do side payments help? Collective decisions and strategic delegation

I investigate when a exible bargaining agenda, where side payments are possible, facilitates cooperation in a context with strategic delegation. On the one hand, allowing side payments may be necessary when one partys participation constraint otherwise would be violated. On the other, with side payments each principal appoints a delegate that values the project less, since this increases her bargaining power. Reluctant agents, in turn, implement too few projects. I show that side payments are bad if the heterogeneity is small while the uncertainty and the typical value of the project are large. With a larger number of parties there may be a stalemate without side payments, but delegation becomes more strategic as well, and cooperation decreases in either case.Collective action, side transfers, bargaining agenda, strategic delegation, issue linkages

Flexible Integration

For a club such as the European Union, an important question is when, and under which conditions, a subset of the members should be allowed to form "inner clubs" and enhance cooperation. Flexible cooperation allows members to participate if and only if they benefit, but it generates a freerider problem if potential members choose to opt out. The analysis shows that flexible cooperation is better if the heterogeneity is large and the externality small. The best possible symmetric and monotonic participation mechanism, however, is implemented by two thresholds: A mandatory and a minimum participation rule. Rigid and flexible cooperation are both special cases of this mechanism. For each of these thresholds, the optimum is characterized.

Incomplete Contracts in Dynamic Games

I develop a dynamic model of costly private provision of public goods where agents can also invest in cost-reducing technologies. Despite the n+1 stocks in the model, the analysis is tractable and the (Markov perfect) equilibrium unique. The frame-work is used to derive optimal incomplete contracts in a dynamic setting. If the agents can contract on provision levels, but not on investments, they invest suboptimally little, particularly if the contract is short-term or close to its expiration date. To encourage sufficient investments, the optimal and equilibrium contract is more ambitious if it is short-lasting, and it is tougher to satisfy close to its expiration date. If renegotiation is possible, such a contract implements the first best. The results have important implications for how to design a climate treaty.Dynamic private provision of public goods, dynamic common-pool problems, dynamic hold-up problems, incomplete contracts, renegotiation design, climate change and climate agreements JEL Classification Numbers: D86, H87, Q54, F53

The Dynamics of Climate Agreements

I provide a novel dynamic model with private provision of public bads and investments in technologies. The analysis is tractable and the MPE unique. By adding incomplete contracts, I derive implications of and for international climate treaties. While the non-cooperative equilibrium is bad, short-term agreements are worse due to hold-up problems. A long-term agreement should be more ambitious if it is rela- tively short-lasting and the technological externality large. The length itself should increase in this externality. With renegotiation, the outcome is …rst best. The technological externalities are related to trade agreements, making them strategic substitutes to climate treatieDynamic private provision of public goods, dynamic common pool prob- lems, dynamic hold-up problems, incomplete contracts, time horizon of contracts, renegotiation design, climate change, climate agreements and trade agreements

On dimensional line radiative transfer

Integrations over solid angle and frequency are performed in the expressions for the radiant heat flux and local energy loss of a line in a region of strong variations of the source function in one direction. Approximations are given for coefficients and kernels in the resulting forms which involve integrals over the physical coordinate

The Dynamics of Climate Agreements

I develop a dynamic model of private provision of public bads allowing investments in technologies. The analysis is tractable and the MPE unique. The framework is used to derive optimal incomplete contracts in a dynamic setting. While the noncooperative equilibrium is very inefficient, short-term contracts can be worse due to hold-up problems. The optimal long-term contract is more ambitious if its length is relatively short and the technological spillover large. The optimal length increases in this externality. With renegotiation, the outcome is first best. The results have several implications for how to design a climate treaty.dynamic private provision of public goods, dynamic common pool problems, dynamic hold-up problems, incomplete contracts, contract-length, renegotiation design, climate change and climate agreements

William S. Vickrey

Entry for William Vickrey, prepared for the Dictionary of Scientific BiographyVickrey's Contributions, Vickrey Auction, Public Economics, Asymmetric Information

Transport equations for gases and plasmas obtained by the 13-moment method - A summary

Momentum transfer solutions to Boltzmann transport equations for gas mixture and plasma

Nonstationary homogeneous nucleation

The theory of homogeneous condensation is reviewed and equations describing this process are presented. Numerical computer solutions to transient problems in nucleation (relaxation to steady state) are presented and compared to a prior computation

Does a Seller Really Want Another Bidder?

Several papers compare auctioning heterogeneous assets sequentially with sequentially selling the right to choose among assets not yet taken. Typically motivated by auctions of condos for owner occupation, these papers have assumed that each winning bidder exits, so each successive auction has less competition. In many heterogeneous-asset-sale situations, a winning bidder may still be interested in acquiring further assets. We build a simple model of persistent competition, in which the distribution of equilibrium revenue from separate sales is shown to be a mean-preserving spread of the distribution of revenue from selling rights to choose. Persistent competition reveals that a high bidder does not always select his most preferred asset, and that one asset being slightly more likely to be a favored asset discontinuously affects equilibrium bidding.auction theory; rights-to-choose auctions; revenue comparisons; persistent competition; private information