We raise the problem of the minorities' survival in the presence of positive network externalities. We rely on the example of thematic clubs to illustrate why and in which circumstances such survival problems might appear, …rst considering the case of simple network externalities and then the case of cross network externalities. Sonnac and Skerdilajda Zanaj for their comments and suggestions.

Here we perform the same kind of “integration experiments” as in Rivera-Batiz and Romer (1991), this time in the context of a “quality ladder model”, where international trade integration is not enough to prevent redundancy of R&D efforts. Thus a further kind of integration is analysed: “financial market integration”. We adopt as a setup the Simple Schumpeterian Model in Aghion and Howitt (2005...

In this paper, we examine the role of recessions on the relative forecasting performance of the Fed and the private sector. Romer and Romer (2000) show that the Fed’s forecasts of in‡ation and output were superior to that of the private sector for the pre-1991 period. D’Agostino and Whelan (2007) …ndings suggest that the information superiority of the Fed deteriorated after 1991. Our results sh...

This paper is analyzes a neoclassical overlapping generations model. We discuss a two-sector economy with intermediate and final goods in the spirit of Romer (1990). Agents engage in one of two alternative occupations: either self–employment in the intermediate goods sector, which is characterized by monopolistic competition, or employment as an ordinary worker in this sector. Entrepreneurial p...

In most economic applications, externalities prevail: the worth of a coalition depends on how the other players are organized. We show that there is a unique natural way of extending the nucleolus from (coalitional) games without externalities to games with externalities. This is in contrast to the Shapley value and the core for which many different extensions have been proposed.

We describe the behaviour of a monopolist supplying a vertically di¤erentiated good with network externalities. Assuming a ...xed cost of quality improvements, we show that the presence of network externalities enhances the incentive to expand output associated with scale economies. Although the quality distortion operated by the monopolist increases with network externalities, the output expan...

We introduce contingent auction mechanisms, which is a superset of combinatorial auctions, and where bidders submit bids on packages that are contingent on the whole nal assignment. Without externalities, the Vickrey and the Ausubel-Milgrom Proxy Auction are both robust if items are perceived as substitutes. Such an equivalence between those formats may not hold with externalities and the analo...

Gasoline-powered vehicles produce many negative externalities including congestion, air pollution, global climate change, and accidents. A gasoline tax is perhaps the best policy to jointly address these externalities. This paper calculates the optimal gasoline tax for China. Using a model developed by Parry and Small [1] [2], we calculate the optimal adjusted Pigovian tax in China to be $1.58/...