The technological advances in recent years are allowing Internet Service Providers (ISPs) to provide Quality of Service (QoS) assurance for traffic through their domains. This article develops a spot pricing framework for intra-domain expected bandwidth contract with'a loss based QoS guarantee. The framework accounts for both the cost and the risks associated with QoS delivery. A nonlinear pric...

The price dispersion means different prices for same goods. In the Internet economy, many economists reckon that the price dispersion in the e-commerce markets should descend along with the dropping of search cost. However, the correlative empirical studies reach a contrary opinion: there not only exist price dispersion in the e-commerce market, but also has larger dispersion degree than the tr...

Quality-Adjusted Life Years (QALYs) are the most widely-used measure of health in cost– effectiveness analysis and cost–benefit analysis. Within a welfarist framework QALYs are consistent with people’s preferences under stringent assumptions. Several authors have argued that QALYs are a valid measure of health within an extra-welfarist framework. This paper studies the applicability of QALYs wi...

Tradable permits are celebrated as a political instrument since they allow (i) firms to equalize marginal abatement costs through trade and (ii) the government to distribute the burden of the policy in a politically fair and feasible way. These two concerns, however, conflict in a dynamic setting. Anticipating that high-cost firms will receive more permits in the future, firms purchase excessiv...

This paper attempts to reconcile an apparent contradiction between short-run and long-run movements in the price of gold. A theoretical model is developed that suggests a set of the conditions that would have to be satisfied for the price of gold to rise over time at the general rate of inflation and hence be an effective long-run hedge against inflation. The model also demonstrates that short-...

This paper examines whether consumers necessarily benefit from tightening the price cap. We find that a tighter price cap always increases consumer welfare when demands are independent. Conversely, when demands are interdependent a tighter price cap may reduce consumer welfare.  2000 Elsevier Science S.A. All rights reserved.

British government bonds formed the deepest, most liquid, and most transparent financial market of the 19th century. This paper shows that those bonds had long periods, extending over decades, of anomalous behavior, in which Consols, the largest and best known of these instruments, were noticeably overpriced relative to equivalent securities which offered the same interest rate and the same gua...

Inflation targeting needs to be supplemented by an economic growth target so that central banks will not adopt monetary policy which results in stagnation. There is no guarantee that the economy will move towards full employment by itself when the inflation rate is kept between two to three per cent. Monetary policy does not have a comparative advantage in achieving price stability. Svensson's ...

This paper examines the conditions required to guarantee positive prices in the CAPM. Positive prices imply an upper bound on the equity premium. This upper bound depends on the degree of diversity of firms’ fundamentals, and it is independent of investors’ preferences. In economies with realistically diverse assets the only positive-price CAPM equilibrium theoretically possible is a degenerate...

We show the existence of Nash equilibria in a Bertrand oligopoly price competition game using a possibly asymmetric attraction demand model with convex costs under mild assumptions. We show that the equilibrium is unique and globally stable. To our knowledge, this is the first paper to show the existence of a unique equilibrium with both non-linear demand and non-linear costs. In addition, we g...