In this paper we deal with the problem of incentive mechanism design which yields efficient allocations for general mixed ownership economies when preferences, individual endowments, and coalition patterns among individuals are unknown to the planner. We do so by doubly implementing the proportional solution for economies with any number of private sector and public sector commodities and any n...

In a continuous-time economy with complete markets, we show how the heterogeneity in the individual consumers’ risk attitudes and impatience would affect the representative consumer’s counterparts. Specifically, our formulas tell us how his risk tolerance and impatience will change over time, and how his impatience will be affected by the changes in aggregate consumption levels. Under the assum...

We consider allocation problems with indivisible goods when agents’ preferences are single-peaked. Two natural procedures (up methods and temporary satisfaction methods) are proposed to solve these problems. They are constructed by using priority methods on the cartesian product of agents and integer numbers, interpreted either as peaks or opposite peaks. Thus, two families of solutions arise t...

We investigate the welfare effects of eliminating business cycles in a model with substantial consumer heterogeneity. The heterogeneity arises from uninsurable and idiosyncratic uncertainty in preferences and employment, where, regarding employment, we distinguish among employment and shortand long-term unemployment. We calibrate the model to match the distribution of wealth in U.S. data and fe...

We consider algorithmic problems in a distributed setting where the participants cannot be assumed to follow the algorithm but rather their own self-interest. As such participants, termed agents, are capable of manipulating the algorithm, the algorithm designer should ensure in advance that the agents’ interests are best served by behaving correctly. Following notions from the field of mechanis...

This paper discusses a novel approach to elicit people’s preferences for public goods, namely the life satisfaction approach. Reported subjective well-being data are used to directly evaluate utility consequences of public goods. The strengths of this approach are compared to traditional approaches and identification issues are addressed. Moreover, it is applied to estimate utility losses cause...

An open puzzle for climate-policy analysis is how policies could be made sensitive to climate change impacts spanning over centuries while keeping the shorterterm macroeconomic policies connected to the descriptive facts. We develop a tractable general-equilibrium model for climate-economy interactions with timedeclining pure discounting. The model resolves the puzzle: preferences over longterm...

Monetary valuation of environmental change is useful if one aims to rank alternative projects according to some specific social welfare function. However, if the project analysis is intended as background information to a democratic debate, the advantages of monetary valuation are less obvious. This paper analyzes aggregation of information, taking normative disagreement explicitly into account...

We study top trading cycles in a two-sided matching environment (Abdulkadiroglu and Sonmez (2003)) under the assumption that individuals’ preferences and objects’ priorities are drawn iid uniformly. We show that the number of individuals/objects assigned at each round follows a simple Markov chain and we explicitly derive the transition probabilities. This Markov property is used to shed light ...