This paper provides a full equilibrium characterization of warm-glow giving à la Andreoni (1989, 1990) by extending the Andreoni-McGuire (1993) algorithm. The characterization indexes individuals according to their free-riding or “dropout” levels of the public good. The dropout level is finite for an individual whose donation is always dictated by some altruism. We show that if all individuals ...

This paper presents an overlapping generations model in which children seek to manipulate the size of the end-of-life bequest they receive from the parent. I first use numerical simulations to show this intergenerational strategic behavior does not negate the debt neutrality assertions of Ricardian equivalence. Then, by introducing capital gains and inheritance taxes, I show the crowding out ef...

When the government gives a grant to a private charitable organization, do the donors to that organization give less? If they do, is it because the grants crowd out donors who feel they gave through taxes (classic crowd out), or is it because the grant crowds out the fund-raising of the charities who, after getting the grant, reduce efforts of fund-raising (fund-raising crowd out)? This is the ...

Regulations that are designed to improve social welfare typically begin with the premise that individuals are purely self-interested. Therefore, in a situation in which private and social interests diverge, it should be possible to bring about a welfare improvement by imposing rules that provide the necessary incentives for more socially efficient choices. However, experimental evidence shows t...

We study differently framed incentives in dynamic laboratory buyerseller relationships with multi-tasking and endogenous matching. The experimental design tries to mitigate the role of social preferences and intrinsic motivation. Absent explicit incentives, effort is low in both tasks. Their introduction boosts efficiency substantially increasing effort in the contractible task, mildly crowding...

The risk of external interventions crowding-out intrinsic motivation has long been established in economics. This paper introduces a new dimension by arguing that a crowdingout effect does become possible if individuals receive higher relative compensation. Using a unique, large data set that focuses on 26 seasons in basketball (NBA) we find empirical support for a relative crowding-out effect....

The need for effective safety nets and social security has been highlighted by the recent crisis in East-Asia. In other parts of the developing world or in transition economies, the large economic fluctuations, climatic shocks and natural disasters also demand further development of support systems during crises. In this paper, we discuss the role played by self-insurance (via savings) in the p...

It is commonly believed that a fiscal expansion raises interest rates. However, these crowding out effects of deficits have been found to be small or non-existent. One explanation is that financial integration offsets interest rate differentials on globalised bond markets. This paper measures the degree of integration of government bond markets, using spatial modelling techniques to take this s...