Electronic titling: Potential and risks

Initiatives in electronic conveyancing and registration show the potential of new technologies to transform such systems, reducing costs and enhancing legal security. However,they also incur substantial risks of transferring costs and risks among registries, conveyancersand rightholders, instead of reducing them; entrenching the private interests of conveyancers,instead of increasing competition and disintermediating them; modifying the allocation of tasksin a way that leads in the long term to the debasement of registries of rights with indefeasibletitle into mere recordings of deeds; and empowering conveyancers instead of transactors andrightholders, which increases costs and reduces security. Fulfilling the promise of newtechnologies in both costs and security requires strengthening registries incentives andempowering rightholders in their interaction with registries.

Audit quality: Attributes, private safeguards and the role of regulation

This article examines the private mechanisms used to safeguard quality in auditing, with a view to defining rules capable of facilitating the performance of market forces. An outline is given of a general theory of private quality assurance in auditing, based on the use of quasi-rents to self-enforce quality dimensions. Particular attention is paid to the role of fee income diversification as the key ingredient of private incentives for audit quality. The role of public regulation is then situated in the context defined by the presence of these safeguard mechanisms. This helps in defining the content of rules and the function of regulatory bodies in facilitating and strengthening the protective operation of the market. By making sense of the interaction between regulation, quality attributes and private safeguards, the analysis helps to evaluate the relative merits of different regulatory options.

Reputation and honesty in a market for information

Previous works on asymmetric information in asset markets tendto focus on the potential gains in the asset market itself. We focus on the market for information and conduct an experimental study to explore, in a game of finite but uncertain duration, whether reputation can be an effective constraint on deliberate misinformation. At the beginning of each period, an uninformed potential asset buyer can purchase information, at a fixed price and from a fully-informed source, about the value of the asset in that period. The informational insiders cannot purchase the asset and are given short-term incentives to provide false information when the asset value is low. Our model predicts that, in accordance with the Folk Theorem, Pareto-superior outcomes featuring truthful revelation should be sustainable. However, this depends critically on beliefs about rationality and behavior. We find that, overall, sellers are truthful 89% of the time. More significantly, the observed frequency of truthfulness is 81% when the asset value is low. Our result is consistent with both mixed-strategy and trigger strategy interpretations and provides evidence that most subjects correctly anticipate rational behavior. We discuss applications to financial markets, media regulation, and the stability of cartels.

Setting standards: Information accumulation in development

We propose a model in which economic relations and institutions in advancedand less developed economies differ as these societies have access to different amounts of information. This lack of information makes it hard to give the right incentives to managers and entrepreneurs. We argue that differences in the amount of information arise because of the differences in the scale of activities in rich and poor economies; namely, there is too little repetition of similar activities in pooreconomies, thus insufficient information to set the appropriate standards for firm performance. Our model predicts a number of institutional and structural transformations as the economy accumulates capital and information.

Gerontocracy, retirement, and social security

Why are the old politically successful? We build a simple interest group model in which political pressure is time-intensive, showing that in the political competitive equilibrium each group lobbies for government policies that lower their own value of time but the old do so to a greater extent and as a result are net gainers from the political process. What distinguishes the elderly from other political groups (and what makes them more succesful) is that they have lower labor productivity and/or that we are all likely to become elderly at some point, while we are relatively unlikely to change gender, race, sexual orientation, or even ocupation, The model has a variety of implications for the design of social security programs, which we test using data from the Social Security Administration. For example, the model predicts that social security programs with retirement incentives are larger and that the old are more "single-minded" in their politics, implications which we verify using cross-country government finance data and cross-country political participation surveys. Finally, we show that the forced savings programs intended to "reform" the social security system may increase the amount of intergenerational redistribution. As a model for evaluating policy reforms, ours has the attractive feature that reforms must be time time consistent from a political point of view rather than a public interest point of view.

Lending to the borrower from hell: Debt and default in the age of Philip II, 1556-1598

What sustained borrowing without third-party enforcement, in the early days of sovereignlending? Philip II of Spain accumulated towering debts while stopping all payments tohis lenders four times. How could the sovereign borrow much and default often? Weargue that bankers ability to cut off Philip II s access to smoothing services was key. Aform of syndicated lending created cohesion among his Genoese bankers. As a result,lending moratoria were sustained through a cheat the cheater mechanism (Kletzer andWright, 2000). Our paper thus lends empirical support to a recent literature emphasizingthe role of bankers incentives for continued sovereign borrowing.

Will EMU increase eurosclerosis?

In this paper we study the relationship between labor market institutions and monetary policy. We use a simple macroeconomic framework to show how optimal monetary policy rules depend on labor institutions (labor adjustment costs, and nominal and real wage rigitidy) and social preferences regarding inflation, employment, and real wages. We also calibrate our model tocompute how the change in social welfare brought about by giving up monetary policy as a result of joining the Economic and Monetary Union (EMU) depends on institutions and preferences. We then use the calibrated model to analyze how EMU affects the incentives for labor market reform, both for reformsthat increase the economy's adjustment potential and for those that affect the long-run unemployment rate.

The effects of tax deductibility on the mix of property taxes and use charges: an empirical analysis of the spanish case

This paper tests some hypothesis about the determinants of the local tax structure. In particular, we focus on the effects that the property tax deductibility in the national income tax has on the relative use of the property tax and user charges. We deal with the incentive effects that local governments face regarding the different sources of revenue by means of a model in which the local tax structure and the level of public expenditure arise as a result of the maximizing behaviour of local politicians subject to the economic effects of the tax system. We attempt to test the hypothesis developed with data corresponding to a set of Spanish municipalities during the period 1987-9l. We find that tax deductibility provides incentives to raise revenues from the property tax but does not introduce a biass against user charges or in favor of overall spending growth

¿Las patentes aceleran o retrasan la comercialización de nuevos medicamentos en los países en desarrollo?

Este trabajo analiza el impacto de las patentes en la dinámica de introducción de nuevos medicamentos en diferentes mercados nacionales. El estudio de un conjunto de mercados de medicamentos contra el VIH/SIDA en una muestra de países en desarrollo indica que las patentes sólo aceleran significativamente la introducción de los nuevos medicamentos después de que hayan pasado entre 1 y 4 años desde su lanzamiento mundial. Las patentes impiden que se introduzcan copias locales de los nuevos medicamentos comercializados por las grandes multinacionales, y la falta de competencia y los mayores precios de introducción resultantes ofrece a las multinacionales mayores ingresos en la comercialización de nuevos medicamentos mientras dura la patente. Sin embargo, el incentivo económico que debería acelerar la disponibilidad de nuevos medicamentos parece operar con cierto retraso

The effects of tax deductibility on the mix of property taxes and use charges: an empirical analysis of the spanish case

This paper tests some hypothesis about the determinants of the local tax structure. In particular, we focus on the effects that the property tax deductibility in the national income tax has on the relative use of the property tax and user charges. We deal with the incentive effects that local governments face regarding the different sources of revenue by means of a model in which the local tax structure and the level of public expenditure arise as a result of the maximizing behaviour of local politicians subject to the economic effects of the tax system. We attempt to test the hypothesis developed with data corresponding to a set of Spanish municipalities during the period 1987-9l. We find that tax deductibility provides incentives to raise revenues from the property tax but does not introduce a biass against user charges or in favor of overall spending growth

¿Las patentes aceleran o retrasan la comercialización de nuevos medicamentos en los países en desarrollo?

Este trabajo analiza el impacto de las patentes en la dinámica de introducción de nuevos medicamentos en diferentes mercados nacionales. El estudio de un conjunto de mercados de medicamentos contra el VIH/SIDA en una muestra de países en desarrollo indica que las patentes sólo aceleran significativamente la introducción de los nuevos medicamentos después de que hayan pasado entre 1 y 4 años desde su lanzamiento mundial. Las patentes impiden que se introduzcan copias locales de los nuevos medicamentos comercializados por las grandes multinacionales, y la falta de competencia y los mayores precios de introducción resultantes ofrece a las multinacionales mayores ingresos en la comercialización de nuevos medicamentos mientras dura la patente. Sin embargo, el incentivo económico que debería acelerar la disponibilidad de nuevos medicamentos parece operar con cierto retraso

Heterogeneity, selection and labor market disparities

We study the incentives to acquire skill in a model where heterogeneous firmsand workers interact in a labor market characterized by matching frictions and costlyscreening. When effort in acquiring skill raises both the mean and the variance of theresulting ability distribution, multiple equilibria may arise. In the high-effort equilibrium, heterogeneity in ability is sufficiently large to induce firms to select the bestworkers, thereby confirming the belief that effort is important for finding good jobs.In the low-effort equilibrium, ability is not sufficiently dispersed to justify screening,thereby confirming the belief that effort is not so important. The model has implications for wage inequality, the distribution of firm characteristics, sorting patternsbetween firms and workers, and unemployment rates that can help explaining observedcross-country variation in socio-economic and labor market outcomes.

Immigration and housing: rethinking the role of fiscal policies to manage diversity

We study the two key social issues of immigration and housing in lightof each other and analyse which housing policies work best to distributediversity (racial, economic, cultural) equally across our cities and towns. Inparticular, we compare the impact of direct government expenditure andtax incentives on the housing conditions of immigrants in four Europeancountries: France, Germany, Spain and the United Kingdom. The analysisshows that the different policies which have been adopted in these countrieshave not succeeded in preventing immigrants from being concentratedin certain neighbourhoods. The reason is that housing benefits andtax incentives are normally “spatially blind”. In our opinion, governmentsshould consider immigration indirectly in their housing policies and, forinstance, distribute social housing more evenly across different areas topromote sustainable levels of diversity.

Transferència científica a l'Institut de Ciència i Tecnologia Ambientals : anàlisi de la vinculació universitat - societat

Aquest projecte ha estat impulsat per l’Observatori de la Divulgació de la Ciència (ODC) de la UAB i dut a terme a l’Institut de Ciència i Tecnologia Ambientals (ICTA). Està emmarcat dins el marc del nou Programa Europeu Horizon 2020 i més específicament dels conceptes establerts per la RRI. L’objectiu d’aquest projecte és analitzar la comunicació científica que duu a terme l’ICTA cap a al societat i conèixer la filosofia, els incentius i la motivació de l’ICTA i els seus investigadors per donar a conèixer la seva recerca a la ciutadania. L’anàlisi de la comunicació de l’ICTA consta d’un anàlisi del contingut de la pàgina web del centre de recerca, una entrevista feta a la directora de l’institut i un qüestionari realitzat a 14 investigadors Les formes de comunicació que més utilitzen són els articles científics en revistes dirigides a públic acadèmic. Respecte la comunicació no acadèmica, s’ha pogut observar que la majoria dels investigadors, tot i la manca de facilitats realitzaven activitats per interès personal, molts cops però, no comuniquen la seva recerca, principalment perquè tenen altres tasques de docència, de recerca i gestió per atendre. Hi ha una minoria que es refereix a la comunicació científica com un “estil essencialment vocacional”. Per tal d’impulsar i promoure una estratègia contínua i efectiva de comunicació científica cal definir un pla de comunicació a nivell institucional que contribueixi a millorar les capacitats divulgatives, comunicatives i educatives de l’ICTA per tal d’ajudar a les persones que hi fan recerca a apropar la seva tasca a la societat a la que pertanyen.

Endogenous depth of reasoning

We introduce a model of strategic thinking in games of initial response. Unlike standard level-k models, in this framework the player's `depth of reasoning' is endogenously determined, andit can be disentangled from his beliefs over his opponent's cognitive bound. In our approach,individuals act as if they follow a cost-benefit analysis. The depth of reasoning is a function ofthe player's cognitive abilities and his payoffs. The costs are exogenous and represent the gametheoretical sophistication of the player; the benefit instead is related to the game payoffs. Behavioris in turn determined by the individual's depth of reasoning and his beliefs about the reasoningprocess of the opponent. Thus, in our framework, payoffs not only affect individual choices inthe traditional sense, but they also shape the cognitive process itself. Our model delivers testableimplications on players' chosen actions as incentives and opponents change. We then test themodel's predictions with an experiment. We administer different treatments that vary beliefs overpayoffs and opponents, as well as beliefs over opponents' beliefs. The results of this experiment,which are not accounted for by current models of reasoning in games, strongly support our theory.Our approach therefore serves as a novel, unifying framework of strategic thinking that allows forpredictions across games.