1 This paper has bene…ted from communications with Steve Matthews on related issues. and suggestions. Any remaining errors are our own. A de…ning feature of the premium auctions is that the seller commits to o¤ering a share of pro…t, called " premium, " to a number of highest bidders when the auction ends successfully. This paper analyzes an English premium-auction (EPA) model in a setting that...

We consider a situation of full insurance coverage for prescription drugs where, at a certain point in time, people are given the opportunity to take a deductible in exchange for a lower premium. Four determinants of this premium reduction can be considered: expected out-ofpocket payments, adverse selection effects, moral hazard effects, and administration costs. The purpose of this study is to...

W analyze a large-scale field test conducted with a mail-order catalog firm to investigate how customers react to premium prices for larger sizes of women’s apparel. We find that customers who demand large sizes react unfavorably to paying a higher price than customers for small sizes. Further investigation suggests that these consumers perceive that the price premium is unfair. Overall, premiu...

The stylized facts suggest a negative relationship between tax progressivity and the skill premium from the early 1960s until the early 1990s, and a positive one thereafter. They also generally imply rising tax progressivity, except for the 1980s. In this paper, we ask whether optimal tax policy is consistent with these observations, taking into account the demographic and technological factors...

The object of this paper is to model and forecast both objective volatility and its associated risk premium using a non-Gaussian state space approach. Option and spot market information on the unobserved volatility process is captured via nonparametric, ‘model-free’ measures of option-implied and spot price-based volatility, with the two measures used to define a bivariate observation equation ...

Past research that asserts a fatherhood wage premium often ignores the heterogeneity of fathering contexts. I expect fatherhood to produce wage gains for men if it prompts them to alter their behavior in ways that increase labor-market productivity. Identity theory predicts a larger productivity-based fatherhood premium when ties of biology, coresidence with the child, and marriage to the child...

Non-linear external habit persistence models, which feature prominently in the recent “equity premium” asset pricing and macroeconomics literature, generate counterfactual predictions in the cross-section of stock returns. In particular, we show that in the absence of crosssectional heterogeneity in firms’ cash-flow risk, these models produce a “growth premium,” that is, stocks with high price-...