2007

 1. Cason, T., and T. Sharma,"Recommended Play and Correlated Equilibrium: An Experimental Study,"  Economic Theory, 33(2007): 11-27.

Abstract:

This study reports on a laboratory experiment wherein subjects play a hawk-dove game. We try to implement a correlated equilibrium with payoffs outside the convex hull of Nash equilibrium payoffs by privately recommending play. We find that subjects are reluctant to follow certain recommendations. We are able to implement this correlated equilibrium, however, when subjects play against robots that always follow recommendations, including in a control treatment in which human subjects receive the robot "earnings". This indicates that the lack of mutual knowledge of conjectures rather than social preferences, explains subjects' failure to play the suggested correlated equilibrium when facing other human players.


 2. Gomberg, A., F. Marhuenda., and I. Ortuño-Ortín, "Endogenous platforms: the case of many parties,"  International Journal of Game Theory, 35 (2007): 223-249.

Abstract:

We analyze existence of equilibrium in a one-dimensional model of endogenous party platforms and more than two parties. The platforms proposed by parties depend on their membership composition. The policy implemented is a function of the different proposals and the vote distribution among such proposals. It is shown that if voters are sincere there is always an equilibrium regardless of the number of parties. In the case of strategic voting behavior, existence of equilibrium can be shown provided a subadditivity condition on the outcome function holds.


 3. Lobato, I., and C. Velasco, "Efficient Wald Test for Fractional Unit Roots,"  Econometrica, 75 (2007): 575-589.

Abstract:

In this article we introduce efficient Wald tests for testing the null hypothesis of unit root against the alternative of fractional unit root. In a local alternative framework, the proposed tests are locally asymptotically equivalent to the optimal Robinson (1991, 1994a) Lagrange Multiplier tests. Our results contrast with the tests for fractional unit roots introduced by Dolado, Gonzalo and Mayoral (2002) which are inefficient. In the presence of short range serial correlation, we propose a simple and efficient two-step test that avoids the estimation of a nonlinear regression model. In addition, the first order asymptotic properties of the proposed tests are not affected by the pre-estimation of short or long memory parameters.


 4. Martinelli, C.,"Rational Ignorance and Voting Behavior,"  International Journal of Game Theory, 35 (2007): 315-335.

Abstract:

 We model a two-alternative election in which voters may acquire information about which is the best alternative for all voters. Voters differ in their cost of acquiring information. We show that as the number of voters increases, the fraction of voters who acquire information declines to zero. However, if the support of the cost distribution is not bounded away from zero, there is an equilibrium with some information acquisition for arbitrarily large electorates. This equilibrium dominates in terms of welfare any equilibrium without information acquisition--even though generally there is too little information acquisition with respect to an optimal strategy profile.


 5. Martinelli, C., and R. Escorza, "When Are Stabilizations Delayed? Alesina-Drazen Revisited,"  European Economic Review,51 (2007): 1223-1245.

Abstract:

 In an influential article, Alesina and Drazen (1991) model delay of stabilization as the result of a struggle between political groups supporting reform plans with different distributional implications. In this paper we show that ex ante asymmetries in the costs of delay for the groups will reduce the probability of conflict and will lead to a shorter expected delay. Accurate common information about the cost of delay may lead to no delay at all. In an asymmetric conflict, a wider divergence in the distributional implications of reform will reduce the probability of conflict but will lead to a longer expected delay. We motivate the asymmetric model of delay by reference to Latin American episodes of the 1980s.


 6. Rendón, S., "Does Wealth explain Black-White Differences in Early Employment Careers?,"  Journal of Business and Economic Statistics, 25 (2007): 484-500.

Abstract:

In this paper I inquire about the effects initial wealth has on black-white differences in early employment careers. I set up a dynamic model in which individuals simultaneously search for a job and accumulate wealth, and fit it to data from the National Longitudinal Survey (1979-cohort). Regime changes and decompositions of racial differences reveal that differences in the labor market environment and in preferences account fully for racial gaps in wealth and in wages persisting several years after High School graduation. Differences in initial wealth partially explain differences in early employment careers.


 7. Rendón, S.,"The Catalan Premium: Language and Employment in Catalonia,"  Journal of Population Economics, 20 (2007): 669-686.

Abstract:

In this paper I measure the contribution of knowing Catalan to finding a job in Catalonia. In the early eighties a drastic language policy change (normalització) promoted the learning and use of Catalan in Catalonia and managed to reverse the falling trend of its relative use versus Castilian (Spanish). Using census data for 1991 and 1996, I estimate a significant positive Catalan premium: the probability of being employed increases between 3 and 5 percentage points if individuals know how to read and speak Catalan; it increases between 2 and 6 percentage points for writing Catalan.