It is commonly alleged that a substantial proportion of lawsuits are frivolous and are filed only for their nuisance value. This paper models settlement bargaining in the presence of frivolous suits as a game of asymmetric information, where the plaintiff knows the true merits of his claim, and the defendant does not, apart from any inferences he can draw from the fact of suit. When there is fr...

We model the bidding for a government contract in which there is imperfect competition; each bidder is better informed about his own costs than either his rival bidders or the government; and the distribution of the domestic firms’ costs differs from the distribution of foreign firms’ costs because of comparative-advantage effects. We find that the gcyemment minimizes its expected procurement c...

At the zero lower bound, expected duration of interest rate policy has two dimensions which are key to understanding stance monetary policy: (i) actual communicated by central bank or private sector, and (ii) prescribed underlying rule—the rule that is in place normal times. In a small open economy, depends part on foreign economic conditions. including policy. A tightening abroad depreciates e...

With the enactment of the Federal Rules of Civil Procedure (FRCP), the legal discovery process in healthcare is beginning a radical transformation. The rules governing the discovery of electronic information and the legal process will vary by court jurisdiction (federal, state, or local) as well as the nature, size, and type of case under litigation (civil, criminal, or class action). To prepar...

In many product recovery situations returned products can be reused in multiple ways. Under these circumstances the problem arises in which quantities reusable items should be allocated to the different remanufacturtng options, especially in case of insufficient stock of returns. For this problem a pertodic review model Is formulated which also includes a disposal option and incorporates uncert...

We investigate whether fiscal rules help to reduce the extent of policy procyclicalitydhow government expenditure policy responds to GDP– in a dynamic panel framework with 81 advanced, emerging and developing countries over 1985e2012. We construct two new fiscal rule indices and investigate whether rules help to dampen procyclical policies. We condition our empirical specifications on the degre...

The paper shows that common fiscal rules, such as a limit to the deficit-output ratio, induce an ‘‘escape clause’’–type fiscal policy, similar to that studied for monetary policy by Flood and Isard (1988 and 1989) and Lohmann (1992): The government resorts to an active stabilization (for example, countercyclical) policy only during ‘‘exceptional times’’ by running deficits in recession phases a...

This paper studies the interactions of fiscal and monetary policies in the presence of fiscal spillovers within a monetary union. When capital markets are integrated, the fiscal policy of any member country will influence equilibrium wages and interest rates across the whole union. Thus there are fiscal spillovers within a federation. Within a general class of monetary policy rules, there does ...

We consider a general class of endogenous growth models with infinitely lived households and analyze how different budgetary rules affect the stability of the economy. We show that a discretionary fiscal policy implies that the government always violates its inter-temporal budget constraint along a balanced growth path, whereas a balanced budget rule tends to stabilize the economy. A rule based...

In this paper, the sustainability of public debt is interpreted as the result of the interaction of fiscal policy with the economic environment, and not as a statistical concept as in most of the recent literature. If debt must not explode over time, policy makers have to respond to the changing conditions in the macroeconomic environment. This paper defines the conditions which will ensure com...