The costs of shortages and rationing are not captured by standard consumer price indices. Thus the change in real GDP per capita is an overestimate of welfare losses in transition economies. In this study virtual prices are used to calculate new cost-of-living indices (CLIs). The results for Poland show that from 1987 to 1992 the CLI ignoring the rationing effects is biased upward from 1.53 to ...

Theoretical studies on the e¤ect of life settlement market on consumer welfare show that it crucially depend on the reasons for the lapsation of life insurance policies: if lapsation is purely due to the loss of bequest motives by the policyholders, then life settlement is shown to be detrimental to consumer welfare in equilibrium; on the other hand, if lapsation results from liquidity shocks, ...

This paper applies a model of potentially time-inconsistent preferences to the problem of dynamic labor supply and welfare program participation. From panel data on the choices of single women with children, we provide estimates of the degree of time-inconsistency. With these estimates we can quantify the utility loss stemming from the inability to commit to future decisions, and the potential ...

Even with environmental externalities, money metric measures of individual welfare can often be constructed by methods similar to those of Vartia (1983), provided that individual’s willingness to pay functions are known. Satisfactory money metric measures of social welfare are harder, however. Following Feldstein (1974) and Rosen (1976), a “uniform” money metric measure is proposed, based on th...

We study dual job incentives with a focus on public-service physicians referring patients to their private practices. We call this moonlighting. Not all physicians moonlight; we introduce a group of dedicated doctors who in the base models behave nonstrategically in the public system. Allowing moonlighting can always enhance aggregate welfare. The equilibrium care quality in the public system m...

A. PROOF OF PROPOSITION 4.1 A.1. The Claim to Prove In order to prove Proposition 4.1, we quantify the performance loss of strategies restricted to Aas. The performance loss is determined in the following claim. Claim. Starting from any initial rating profile θ , the maximum social welfare achievable at the PAE by (π0, π · 1N) ∈ (Aas) × N(Aas) is at most b− c − c · ρ(θ , α∗ 0, S∗ B) ∑ s′∈S∗ B q...

In this paper we experimentally compare the welfare efficiency of ‘information markets’ – markets where consumer information can be traded, to markets where no trade in information take place. Consumers face a loss in privacy when revealing personal information and take this loss into account before deciding to trade their information. The experimental setting allows us to set up agent incentiv...

Graphical presentation in textbooks of the problem of technology adoption by a monopolist always assumes a uniformly downward shift in the marginal cost curve. My purpose in this article is to show that, despite its convenience, this nonintersecting marginal cost assumption obscures some of the workings of a monopoly and incorrectly suggests that welfare improvements and adoption are synonymous...

BACKGROUND In the UK many people with cancer and their carers do not have easy access to the welfare benefits to which they are entitled adding further strain to the process of dealing with cancer. It is estimated that nine out of ten cancer patients' households experience loss of income as a direct result of cancer, which, due to its socio-economic patterning disproportionately affects those m...