Association for Public Economic Theory

PET 02

Third International Conference on Public Economics

Paris, July 4th-6th 2002

Conference Program Members of the ADRES’ Administration Council :

· Le Centre National de la Recherche Scientifique · L'Institut National de la Statistique et des Etudes Economiques · La Fondation Banque de France · La Caisse des Dépôts et Consignations · Le CEPREMAP · Le Commissariat Général du Plan · Electricité de France · La Direction de la Prévision (du ministère de l'Economie, des Finances et du Plan) Program Committee

Bernard Cornet (University of Paris 1), Chair Hubert Kempf (University of Paris 1), co-Chair Cuong Le Van (CNRS, University of Paris 1), co-Chair Myrna Wooders (University of Warwick), co-Chair

Committee Members

Marcus Berliant (Washington University) Robin Boadway (Queens University) Raouf Boucekkine (IRES Louvain) Bernard Caillaud (CERAS) John Conley (University of Illinois) Luis Corchon (Carlos III University, Madrid) Jacques Cremer (CNRS - GREMAQ) Hossein Farzin (University of California-Davis) Françoise Forges (University of Cergy-Pontoise) Roger Gordon (University of Michigan) Roger Guesnerie (Collège de France) Leonid Hurwicz (University of Minnesota) Philippe Jehiel (CERAS) Jean-Dominique Lafay (LAEP, University of Paris 1) Didier Laussel (University of Aix-Marseille 2) Ben Lockwood (University of Warwick) Maurice Marchand (CORE) Alfredo Medio (University of Venice) Jean-François Mertens (CORE, UCL) Kazuo Nishimura (Kyoto University) Frank Page (University of Alabama) Pierre Pestieau (University of Liège) Thomas Piketty (CEPREMAP, EHESS) Alain Trannoy (University of Cergy-Pontoise)

Organizing Committee

Nizar Allouch (University of Warwick) Damien Gaumont (University of Paris 2) Pascal Gourdel (University of Paris 1) Hubert Kempf (University of Paris 1) Cuong Le Van (University of Paris 1) Etienne Lehmann (University of St-Etienne) Filipe Martins Da Rocha (U. Paris 1) Flavio Menezes (Australian National Univ.) Fabien Moizeau (Université de Paris 1) Bertrand Wigniolle (University of Paris 1)

Conference Administrator Tuyên Ngoc (University of Paris 1) Program Overview

Wednesday 3rd

7.30 pm Welcome Reception

Thursday 4th

8.00 - 9.00 Registration 9.00 - 9.45 Plenary Lecture 10.00 - 11.15 Session 1 11.15 - 11.45 Coffee Break 11.45 - 1.00 Session 2 1.00 - 3.00 Lunch 3.00 - 3.45 Plenary Lecture 4.00 - 5.15 Session 3 5.15 - 5.45 Coffee Break 5.45 - 7.00 Session 4

7.30 pm Buffet-Reception

Friday 5th

9.00 - 9.45 Plenary Lecture 10.00 - 11.15 Session 5 11.15 - 11.45 Coffee Break 11.45 - 1.00 Session 6 1.00 - 3.00 Lunch 3:00 - 4.15 Session 7 4.15 - 4.45 Coffee Break 4.45 - 6.00 Session 8

6.00 pm Cocktail

Saturday 6th

9.00 - 9.45 Plenary Lecture 10.00 - 11.15 Session 9 11.15 - 11.45 Coffee Break 11.45 - 1.00 Session 10

8.30 pm Jazz-Night on the Seine LOCATIONS

Plenary lectures

Thursday 4th morning : Sorbonne, Salle Liard Thursday 4th afternoon : Sorbonne, Salle Liard Friday 5th : Sorbonne, Amphithéâtre Richelieu Saturday 6th : Sorbonne, Amphithéâtre Richelieu

Sessions

Panthéon

Room 1 : Salle 216 Room 2 : Salle des fêtes Room 3 : Salle 3 Room 8 : Salle 4

Sorbonne

Room 5 : Salle 306 Room 6 : Salle 204 Room 7 : Salle 205 Room 4 : Salle 206 Room 9 : Salle 308 Room 10 : Amphithéâtre Liard PROGRAM

· Each presentation should last no more than 20 minutes (even for parallel sessions with only two speakers), thus, leaving 5 minutes for discussion and changing sessions. · Unless it is stated, the chairman (chairwoman) is the last speaker.

Wednesday 3rd

16.00 - 19.00 Registration:

Galerie Soufflot, University of Paris1, Pantheon-Sorbonne, 12 Place du Panthéon 75005 Paris (Métro Luxembourg) Thursday 4th

8.00 – 9.00 Registration

Galerie Soufflot, University of Paris1, Pantheon-Sorbonne, 12 Place du Panthéon 75005 Paris (Métro Luxembourg)

8.50 - 9.00

Welcome : salle Liard, Sorbonne

Bernard Cornet ( University of Paris 1)

9.00 – 9.45

Plenary lecture : salle Liard, Sorbonne Jean-Jacques Laffont (IDEI and U. of Toulouse) Renegotiation of Concession Contracts in Latin America Chair : Frank H. Page, Jr. (U. of Alabama)

10.00 – 11.15

Session 1 Room 1 : Lobbying Room 2 : Tax competition

Francesco GIOVANNONI (U. of Newcastle) Christoph SAUER (U. of Goettingen) and Margit SCHRATZENSTALLER (U. of Giessen) Heterogeneous lobbying Strategies on international fiscal competition for Sebastian BAVETTA (U. of Palermo and LSE) and foreign direct investment in a model with impure Giorgio BELLETTINI (U. of Bologna) public inputs

Lobbying on local public goods Amrita DHILLON, Myrna WOODERS and Ben ZISSIMOS (U. of Warwick) Guillaume CHEIKBOSSIAN (U. of Perpignan) Tax competition revisited Lobbying and rent-seeking for public goods in a fiscally centralized system Sam BUCOVETSKY (York U.) and Michael SMART (STICERD)

Tax competition and revenue equalization Room 3: Public Good Provision Room 4: Experimental Economics 1

Massimo MORELLI (Ohio State U.) and Alessandra CASELLA, Andrew GELMAN Lise VESTERLUND (U. of Pittsburg) (U. of Columbia) and Thomas PALFREY (Caltech)

Provision point mechanisms and over provision of Storable votes: initial experimental results public goods Arno RIEDL and Aljaz ULE (CREED) Martin KOLMAR (U. of Konstanz) Exclusion and cooperation in social network Endogenously excludable goods experiments

Ali AL-NOWAIHI and Gary BOLTON (Penn State U.), Jordi BRANDTS Clive D FRASER (U. of Leicester) (CSIC) and Axel OCKENFELS (U. of Magdeburg)

Will the public sector be too large in an economy Fair procedures. Evidence from games involving with club goods? lotteries

Room 5: Social Security Room 6: Regulation

Robert FENGE (U. of Munich), Silke ÛBELMESSER and Martin WERDING (CESifo) Axel GAUTIER (U. Bonn)

On the optimal timing of implicit social security Regulation under financial constraints taxes over the life cycle N. BOCCARD (U. of Salerno) and Suzanne PECH (U. of Linz) X.Y. WAUTHY (CEREC and CORE)

Tax incentives for private life annuities and the Ensuring quality provision in deregulated industries social security reform: effects on consumption and on adverse selection Jérôme POUYET (CERAS) and Anna BASSANINI (U. of Rome) Helmut CREMER (IDEI and GREMAQ), Jean-Marie LOZACHMEUR and Pierre PESTIAU (CREPP) Strategic choice of financing systems in regulated and interconnected industries Social security, retirement age and optimal income taxation

Room 7: Social Choice 1 Room 8: Growth 1

Orhan ERDEM (Boiaziçi U. of Turkey) and Remzi Sonia BASSI (LAEP) SANVER (Istanbul Bilgi U.) Determinants of public spending in developing Minimal monotonic extensions of scoring rules countries. Evidence from countries of the M.E.N.A. region Reiko GOTOH, Kotaro SUZUMURA and Naoki YOSHIHARA (Yale U.) Karsten JESKE (Federal Reserve Bank of Atlanta)

Existence of social ordering functions which embody Private international debt with risk of repudiation procedural values and consequential values Toshihiro IHORI (U. of Tokyo) Jean MERCIER-YTHIER (GREQAM) National emergency, security spending and growth Regular distributive social systems Session 1 Room 9: Matching 1 Room 10: Financial Structures and Currency Areas

Guillaume HAERINGER and Jean-Bernard CHATELAIN (Banque de France), Myrna WOODERS (U. of Warwick) Andrea GENERALE (Bank of Italy), Ignacio HERNANDO (Bank of Spain), Job market with commitment Ulf von KALCKREUTH (Bank of Germany) and Philip VERMUELEN (European Central Bank) Pablo REVILLA APARICIO (U. Pablo of Olavide) Firm investment and monetary policy transmission in the Euro Area Many-to-one matching when the colleagues do matter Julius HORVATH (Central European U.) Szilvia PAPAI (U. of Notre-Dame) Optimum currency area theory and correlation of Unique cores in general matching shocks between the accession-candidate countries

Michel BOUTILLIER, A. LABYE, C. LAGOUTTE, N. LEVY, A. MPACKO PRISO, V. OHEIX (MODEM), S. JUSTEAU (ESSCA Angers) and B. SEJOURNE (U. of Angers)

Financial wealth of households and activities of the European financial intermediaries

11.15 – 11.45 Coffee Break

11.45 – 1.00

Session 2 Room 1: Political Economy 1 Room 2: Tax Competition and Coordination

Catherine HAFER and Susana PERALTA and Dimitri LANDA (New York U.) Tanguy van YPERSELE (CORE-UCL)

Political formations under alternative decision rules Coordination of capital taxation among asymmetric countries Barbara VERONESE (STICERD) Marko KOTHENBURGER (U. of Munich) Should Prime Ministers be elected? Tax competition in a European-Style fiscal union with Philippe JEHIEL (CERAS) and decentralized leadership Jacques-François THISSE (CORE, CERAS, CEPR) Eckhard JANEBA (U. of Colorado) and How to win a decision in a federation Michael SMART (STICERD)

Is targeted tax competition less harmful than its remedies ? Session 2 Room 3 : Free Rider Problems Room 4

M.J.RYAN (U. of Hull)

Threshold incomes, public goods and Pareto improving free riding conditions

Chris JONES (The Australian National U.)

The optimal supply of public goods and distortionary taxes

Wolfgang LEININGER (U. of Dortmund)

Contests over public goods: evolutionary stability and the free-rider problem

Room 5 : Social Security and Health Room 6 : Inequality

William JACK (Georgetown U.) Ping WANG (Vanderbilt U.), Chien-Chieh HUANG (National Soo-cho U.) and Optimal redistributive taxation when individuals Derek LAING (Penn State U.) differ on two dimensions: The integration of health expenditure into a linear income tax. Crime and Poverty

Vincenzo GALASSO (U. Bocconi) and Udo EBERT (U. of Oldenburg) Carlos BETHENCOURT (U. Carlos III of Madrid) Decomposable poverty measures when households differ in size Does more health care lead to more social security ? Alain CHATEAUNEUF (CERMSEM) and Maurice MARCHAND (CORE), Robin BOADWAY, Patrick MOYES (U. Montesquieu) Manuel LEITE-MONTERO and Pierre PESTIAU Non-Welfarist Approaches to Inequality Measurement Social insurance and redistribution with moral hazard and adverse selection

Room 7 : Room 8 : Topics in Applied Game Theory Growth 2

Archishman CHAKRABORTY (Baruch College) and Giuseppe Di VITA (U. of Catania) Alessandro CITANNA (HEC Paris) Exhaustible resources and secondary materials: a Occupational Choice, Incentives and Wealth macroeconomic analysis Distribution with an Endogenous Rate of Interest Ben-Lon CHEN (Academia Sinica) Richard CORNES (U. of Nottingham) and Roger HARTLEY (Keele U.) Optimal taxation in a Growth model with public capital stock and adjustment costs Prize dissipation in large contests with small entry costs Stephen J TURNOVSKY (U. of Washington) and Santanu CHATTERJEE (U. of Georgia) Richard CORNES (U. of Nottingham) and Roger HARTLEY (Keele U.) Substitutability of capital, investment costs, and foreign aid Aggregate games and public economics Session 2 Room 9: Topics in Policy choice and Room 10: Insurance Decision Theory

Patrick GONZALEZ (CIRANO, GREEN, CIRPEE) Stefan PICKL (ZAIK) Optimal assignment of liabilities Optimisation of investment decision processes Nathalie LEPINE (GRAPE) Shyh-Fang UENG (Academia Sinica) Risk aversion and risk perception under asymmetric Political auction and policy choice information : a measuring based on data of car insurance contracts. Paul BELLEFLAMME and Jean HINDRIKS (Queen Mary) Bernard SALANIE (CREST)

Yardstick Competition and Political Agency Problem Testable implications of asymmetric information models of insurance

1.00 – 3.00 Lunch 3.00 – 3.45

Plenary lecture : salle Liard, Sorbonne Alain Duchateau (Bank of France) Economic Rationale for Prudential Regulation of Banking: Reform of the Basel Capital Accord.

Chair: Cuong Le Van (CNRS, U. of Paris 1)

4.00 – 5.15

Session 3 Room 1: Voting Room 2: Topics in Tax Competition

Stephen ANSOLABEHERE (MIT), Megan KHOSHYARAN (Catholic U. of Leuven) James M SNYDER (MIT) and Michael TING (U. of North Carolina) Jeux Sans Frontieres revisited: a new study of tax competition when transportation cost is complex. Legislative bargaining under weighted voting Robert FENGE (CESifo) and Volker MEIER Manfred DIX (Tulane U.) and Rudy SANTORE (U. of Tennessee) Why cities should not be subsidized

Campaign contribution with swing voters Katherine CUFF (McMaster U.) and John NURBIDGE Gilbert LAFFOND (CNAM) and Jean LAINE (CREST-LSM) Capital tax competition and strategic firms

Majority voting on budgets

Room 3 : Public Choice: Room 4 : Experimental Economics 3 Public Input and Public Goods

Carsten COLOMBIER Massimo FINOCCHIARO CASTRO (U. of Catania) (Federal Department of Finance, Switzerland ) The experimental approach to the voluntary provision The inefficiency of firm-augmenting public input of public goods vs. The inapplicability of provision rules Claude MEIDINGER and Antoine TERRACOL Stefan DODDS (Queen’s U.) (TEAM)

Monitoring and privacy: when private information is Reciprocation and reinforcement learning model in the a public good investment game

Jonathan CAVE (U. of Warwick)

Net public goods Session 3 Room 5: Room 6: Health Care Rent Seeking and Punishment

Heather BEDNAREK (St Louis U.), Lars FELD and Jean-Robert TYRAN Rowena PECCHENINO (Michigan State U.) and (U. of St Gallen) Sally STEARNS (U. of Aberdeen) Why people obey the law Fat and happy? Marie-Claire VILLEVAL (GATE), Juan Antonio LACOMBA (U. of Granada) David MASCLET, Charles NOUSSAIR and Steve TUCKER Population ageing and retirement age Monetary and non Monetary Punishment in the Pascal GOURDEL (CERMSEM, U. of Paris 1), Voluntary Contribution Mechanism Liem HOANG-NGOC (MATISSE, U. of Paris 1), Cuong LE VAN (CERMSEM, U. of Paris 1) and Tédié MAZAMBA (U. of Paris 2)

Training, healthcare and economic growth

Room 7: Bargaining, Institutions Room 8: Growth 3

Ferdinando COLOMBO and Guido MERZONI Cuong LE VAN (CERMSEM) and H.C. SAGLAM (ISEIS) (IRES)

Short-term vs. Long-term delegation contracts in Quality of knowledge technology, returns to repeated trust games production technology and economic development

BACACHE Maya (ENS-Ulm, EUREQUA) Najah SOUISSI-KACHOURI (LIEI)

How to hire civil servants ? a Trade-off between wages Rattrapage technologique, recherche de rente et and employment convergence économique

Ôzgür KIBRIS (Sabanci U.) and Damien GAUMONT and Daniel LEONARD Bart TAUB (U. of Illinois) (U. of Paris 2)

Bargaining power in stationary parallelogram games Endogenous labour, learning-by-doing and growth

Room 9: Matching in Labour Markets Room 10: Auctions 1

Etienne LEHMANN (EUREQUA) and Mario GILLI (U. of Milan-Bicocca), Bruno VAN DER LINDEN (IRES) Marco LICALZI (U. of Venice) and Alessandro PAVAN (Northwestern U.) Optimal unemployment benefits and non-linear income taxation in a matching model with wage bargaining Using the supply schedule to enhance

Mathieu L’HOIR (TEAM) Anna CRETI (IDEI-CEA) and Claude CRAMPES (GREMAQ-IDEI) Human capital and competition effect Price bid and capacity choice in Electricity markets Gleb KOSHEVOY (U. zu Koeln), V. DANILOV and C. LANG Georgia KOSMOPOULOU (U. of Oklahoma)

Substitutes, complements and equilibrium in two-sided Phantom bidding versus shill bidding: incentives to market models manipulate the auction outcome 5.15 – 5.45 Coffee Break

5.45 – 7.00

Session 4 Room 1: Electoral Outcomes Room 2: Tax Evasion

Lucia BUENROSTRO and Amrita DHILLON Alexander VASIN and Polina VASINA (U. of Warwick) (Moscow State U.)

When are scoring rule voting games dominance- Tax optimization under tax evasion: the role of solvable? penalty constraints

Juan Antonio LACOMBA (U. of Granada) and Marisa RATTO and Thibaud VERGE F.M. LAGOS (U. of Alicante) (U. of Bristol)

Election on retirement age Optimal audit policy and heterogenous agents

Georges CASAMATTA and Rainald BORCK (KPMG) Phillippe De DONDER (GREMAQ) Stricter enforcement may increase tax evasion On the influence of extreme parties in electoral competition with policy-motivated candidates

Room 3 Room 4: Industrial Organisation 1

Alberto IOZZI, Roberta SESTINI and Edilio VALENTINI (U. of Rome)

On the effects of regulating price discrimination by a price capped firm

Etienne B de VILLEMEUR (IDEI-GREMAQ)

Price and quality regulation with multi-dimensionl heterogeneity Session 4 Room 5: Education and Household Room 6: Solving Social Problems

Rick HARBAUGH (Claremont McKenna) Carmen BEVIA (Autonomous U. of Barcelona) Achievement vs aptitude: the incentive-screening tradeoff in college admissions A Theory of Rational Sabotage and How to avoid it

Francois GARDES (CREST-LSM) and Jacques DREZE (CORE), Charles FIGUIERES Christophe STARZEC (U. of Bristol) and Jean HINDRIKS (CORE)

Polish households between transition and informal Voluntary matching grants markets William THOMSON (U. of Rochester) Gianni DE FRAJA (York U.) and Pedro LANDERAS (U. of Cantabria) A difficulty in implementing fairness objectives in classical economies Could do better: the effectiveness of incentives for schools

Room 7: Topics in Game Theory Room 8: Growth and Macro

Stefan NAPEL (U. of Karlsruhe) and Rabah AMIR (U. of Manchester and CORE) Mika WIDGRÉN (Turku School of Economics) Market Structure, scale economies and industry Strategic power revisited performance

Alexandru POPP (Concordia U.) Agnès d’ARTIGUES (CREDEN) and Thierry VIGNOLO (LAMETA) Systemic game theory: Werterian approach A positive theory of the convergence to low inflation Sylvie THORON (GREQAM) rates

Which acceptable agreements are equilibria? Dominique PLIHON and Nacéra TALEB (CEPN and U. of Paris Nord)

The wealth effect in the new growth regime

Room 9: Coalition Formation Room 10: Auctions 2

Santiago SANCHEZ-PAGES David ETTINGER (CERAS) (U. Autonoma of Barcelona) Bidding among friends and enemies Rivalry, exclusion and coalitions James SCHUMMER (Kellogg School of Management), Licun XUE (U. of Aarhus) Sven de VRIES and Rakesh V. VOHRA

Coalitions, agreements and efficiency An ascending Vickrey auction for heterogeneous objects Steven BRAMS (New York U.), Michael JONES (Montclair U.) and Lutz-Alexander BUSCH (U. of Waterloo) and D. Marc KILGOUR (Wilfred Laurier U.) Gervan FEARON (York U.)

Forming stable coalitions: the process matters Auditing and competitive bidding in the public sector Friday 5th

9.00 – 9.45

Plenary lecture : amphithéâtre Richelieu, Sorbonne Alan Auerbach (U. California, Berkeley)

Uncertainty and the Design of Long-Run Fiscal Policy

Chair: TBA

10.00 – 11.15

Session 5 Room 1: Voting and Policy Room 2: Do Citizens Vote? And How?

Ascension ANDINA DIAZ (U. of Alicante) John CONLEY (U. of Illinois) and Myrna WOODERS (U. of Warwick) What do Media Groups complete for ? Evolution and voting: how nature makes us public Sanjit DHAMI (U. of Newcastle) spirited

Corruption and the size of the public sector with Randall REBACK (U. of Michigan) renegotiation-proof delegation of public output The existence of strategic voting Robert SCHWAGER and Christos KOTSOGIANNIS (U. of Mannheim) Amrita DHILLON (U. of Warwick) and Stefano DEMICHELIS (CORE) Political uncertainty and policy innovation Learning in elections and voter turnout

Room 3: Optimal Taxation Room 4 Industrial Organisation 2

John M CRESPI (Kansas State U.) and Ana CEBREIRO-GOMEZ (U. of Essex) Stephan MARETTE (INRA-INAPG)

Optimal taxation and factor mobility in an overlapping Industry concentration and the financing of generations economy product quality regulations

Soren BLOMQUIST (Uppsala U.) and David MARTIMORT (IDEI-GREMAQ) and Luca MICHELETTO Yolande HIRIART (IDEA-CEA)

Age related optimal income taxation Liability rules versus regulation for environmentally risky ventures

Catalin USUREL (U. of Oxford)

Consumer activism and the regulation of socially responsible goods Session 5

Room 5: Room 6: Education and Health Environment 1

Takashi MATSUHISA Salvatore BARBARO (U. of Goettingen) (Ibaraki National College of Technology) and Ryuichiro ISHIKAWA (Hitotsubashi U.) The distributional impact of subsidies to higher education – empirical evidence from Germany Rational expectation can preclude tradeable emission permits Roberta SESTINI (U. of Rome ‘La Sapienza’) Slim BEN YOUSSEF (U. of Tunis) Are you a doctor or a quack? Provision of quality and self-regulation in a market for professional services Transboundary pollution, asymmetric information and social welfare William BLANKENAU (Kansas State U.) and Gabriele CAMERA (Purdue U.) Effrosyni DIAMANTOUDI (Aarhus U.)

Productive education or a marketable degree? International environmental agreements - the role of foresight

Room 7: Room 8: Learning and Coordination Macro

Chair : Isabelle LAUDIER ( CDC) Christine CLEMENS and Thomas RIECHMANN (U. of Hanover) Raphaël FRANCK (U. of Paris II) and Voluntary contribution to a public good: strategic Audrey GENNEQUIN (U. of Paris I) learning of boundedly rational agents Partisan monetary policy delegation in a supra- Edward CARTWRIGHT (U. of Warwick) national federal state under a majority vote system

Imitation equilibrium Corinne AARON-CUREAU (U. of Paris I)

Theodore C BERGSTROM (U. of California) Institutional devices and welfare in a monetary union: a partisan analysis Evolution of social behavior: individual and group selection models Partha SEN (Indian Statistical Institute)

Debt policy in a competitive two-sector overlapping generations model Session 5 Room 9: Social Choice 2 Room 10: Network 1

Murat R SERTEL (Turkish Academy of Sciences) Miguel A MELENDEZ-JIMENEZ (U. of Alicante) and Remzi SANVER Network formation and coordination: bargaining the Strong equilibrium outcomes of voting games are the division of link costs generalized Condorcet winners Sunit CHOPRA (Northwestern U.), Goksel ASAN (Istanbul Bilgi U.) and Daniel GRANOT (U. of British Columbia) and Remzi SANVER Jeroen KUIPERS (U. of Maastricht)

The majority rule in the maximally decisive member Cost allocation for a tree network with of the family of anonymous, neutral, Pareto optimal heterogeneous customers and weakly monotonic aggregation rules Anne van den NOUWELAND (U. of Oregon) and William T. BIANCO (Penn State U.), Matthew O. JACKSON (Caltech) Ivan JELIAZKOV and Itai SENED (Washington U. in St Louis) Strongly stable networks

In search of the uncovered set : A technique for estimating the uncovered set in Real-world legislatures, with application to Party Organizations in the U.S. Congress

11.15 – 11.45 Coffee Break

11.45 – 1.00

Session 6 Room 1: Tax Enforcement, Tax Room 2: More on Lobbying Treaties

Francisco MARHUENDA (U. Carlos III of Madrid), Alexander VASIN (Moscow State U.) and Mattias WREDE (Aachen U.) Polina VASINA (Moscow State U.) Small states, large unitary states and federations Tax enforcement for heterogeneous firms Nuri SENEMEK (U. of Lille I) Dan ANDERBERG (U. of Stirling), Alessandro BALESTRINO (U. of Pisa), and Lobbying for protection and trade policy Umberto GALMARINI (U. of Insubria) determination in a customs union

Search and taxation in a model of underground Y.H. FARZIN (U. of California) and economic activities P.M. KORT (Tilburg U.)

Ron DAVIES (U. of Oregon) and Pollution abatement investment when firms lobby Richard CHISIK (Florida International U.) against environmental regulation

Gradualism in tax treaties with irreversible foreign direct investment Session 6 Room 3: Topics in Taxation Room 4: Contracts and Organisations

Chiara LOMBARDINI-RIIPINEN (FPPE, U. of Helsinki) Alberto CAVALIERE (U. degli Studi di Pavia)

Taxation policy in a duopoly vertically differentiated Price competition with information disparities in a in environmental quality vertically differentiated duopoly

Soren BO NIELSEN, Pascalis RAIMONDOS- Ella KALLAI (Alpha Bank Romania) MOLLER (Copenhagen Business School) and Guttorm SCHJELDERUP (CESifo) Are reallocation models right?

Tax spillovers under separate accounting and Luis C CORCHÓN (U. Carlos III of Madrid) formula apportionment Monk business: an example of the dynamics of Helmut CREMER (IDEI-GREMAQ) and organizations Firouz GAHVARI (U. of Illinois)

Environmental taxation, tax competition and harmonization Room 5: Applied Welfare Economics Room 6: Environment 2

Dolores COLLADO (U. of Alicante), Inigo ITURBE- Phu NGUYEN VAN (BETA-THEME) ORMAETXE (U. of Alicante) and Guadalupe VALERA (U. Pablo of Olavide of Sevilla) Endogenous population and environmental quality

Quantifying the impact of immigration on the Stéphane CALLENS (U. of Brest) Spanish welfare state "Regional constitution" and environmental risk Robert BREUNIG (The Australian National U.) and Thomas EICHNER (U. of Siegen) and Indraneel DASGUPTA (U. of Nottingham) Marco RUNKEL (U. of Munich) Welfare transfers and intra-household trickle-down: Efficiency management of product durability and a model with evidence from the US food stamp recyclability under utilitarian and chichilnisky program preferences

Room 7: Topics in General Room 8: Privatisation, Transition and Equilibrium 1 Exchange Rates Jean-Marc BONNISSEAU and Michael FLORIG Nandini GUPTA (U. of Michigan) (CERMSEM) Partial privatization and firm performance: evidence Oligopoly equilibria in linear exchange economies from India

John K.H QUAH (U. of Oxford) Jan BABETSKI (ROSES-CERGE),

Equilibrium comparisons and welfare theorems when Laurence BOONE (OECD) and goods are normal Mathilde MAUREL (ROSES-CEPR) Chiaki HARA (U. of Cambridge) Does EU enlarged towards Eastern countries Efficiency, equilibrium and core of an exchange constitute an OCA (Optimal Currency Area)? economy with bads and infinitely many consumers

Session 6 Room 9: Mechanism Design Room 10

Guillaume CARLIER (U. Montesquieu)

On a generalized Spence-Mirrlees condition and a reallocation principle

Paulo K. MONTEIRO (EPGE/FGV) and Frank PAGE (U. of Alabama)

Three principles of competitive nonlinear pricing

Jacques CREMER (IDEI-GREMAQ), Yossi SPIEGEL (Tel Aviv U.) and Charles ZENG (Northwestern U.)

Optimal selling mechanisms with costly information acquisition

1.00 – 3.00 Lunch 3.00 – 4.15

Session 7 Room 1: Room 2: Federalism and Cooperative Game Theory Decentralization

Vander LUCAS (IRES) Laszlo A. KOCZY (Katholieke U. of Leuven) Fiscal federalism and bargaining over transfers The core in the presence of externalities Mariano TOMMASI (CEDI) and Maria MONTERO (U. of Dortmund) Frederico WEINSCHELBAUM (U. of San Andrés)

The nucleolus as a Power Index A principal-agent building block for the study of decentralization and integration Irinel DRAGAN (U. of Texas) Luciano GRECO (U. delgi studi di Padova) On the inverse problem for semivalues of cooperative TU games Federalism, devolution and optimal regional grants: an asymmetric information approach

Room 3: Tax Design Room 4: Innovations

Marcel GERARD and Marie-France GILLARD Luca COLOMBO (Istituto di Economia e Finanza) (ARPEGE/FUCAM) Technology adoption with production externalities Tax relief mechanisms and the least taxed path for circulating income within a multinational enterprise Pedro PEREIRA (U. Carlos III)

Klaus BECKMANN (U. Passau) and Dynamics and Shake-Outs in Elctronic Markets Martin WERDING (IFO) Ricardo NIEVA (U. of Minnesota) Two cheers for the EITC Technological path dependence of institutions: the Leslie REINHORN (U. of Durham) case of property rights as a unique solution in supergames with payoffs shocks On optimal redistributive capital taxation

Room 5: Family and Welfare Room 6: Environmental Policies

Laurence JACQUET (IRES)

Optimality of a welfare system with heterogeneous Denis LESCOP (CRESE) preferences and endogenous stigma Optimal mechanisms for siting noxious facilities Antoine TERRACOL (TEAM) Holger MEINHARDT (U. of Karlsruhe) Analyzing the take-up of means-tested benefits in France A dynamic resource management problem

Annalisa LUPORINI (U. di Trieste), Alessandro CIGNO and Anna PETTINI (U. of Florence)

Scholarships or student loans ? Subsidizing higher education in the presence of moral hazard. Session 7 Room 7: Room 8: Privatisation, Transition Topics in General Equilibrium 2

Tony BRYANT (Macquarie U.) Michel GUILLARD and Guillaume GIRMENS (U. of Evry) Appropriate redistributions and the second welfare theorem when equilibrium is not unique Privatization and investments : crowding-out effect vs financial diversification Robert RUSSEL and Sushama MURTY (U. of California) Rinaldo BRAU (U. of Cagliari) and Massimo FLORIO Externality policy reform: a general-equilibrium analysis Privatisations as price reforms: evaluating consumers’ welfare change in the UK Nizar ALLOUCH and Myrna WOODERS (U. of Warwick) Mehrdad SEPAHVAND (U. of Nottingham)

Competitive Pricing in socially Networked Economy Privatization in a regulated market, open to foreign competition

Room 9: Applications of Networks Room 10 : Rights and Freedoms

Yu. E. MALASHENCO, N.M. NOVIKOVA and Catherine SOFER (TEAM) and Irina POSPELOVA David CLEMENT (CA-CEREQ-LEO, U. of Orléans) (Computing Center of Russian Academy of Sciences) An application of “post-welfarist” theories of A model of energy supply according to consumers’ justice: an empirical comparison between demands theoretical rights to compensation and actual policy measures against poverty Yuri YEVDOKIMOV (U. of New Brunswick) Anna RUBINCIK-PESSACH (U. of Colorado) and Sustainable transportation system; A system dynamic Roberto M SAMANIEGO (Washington U.) approach Anarchy, state, Paretopia : demand for the Ping WANG (Vanderbilt U.) and Nozickian minimal state Alison WATTS (Southern Illinois U.) Serge-Christophe KOLM (E.H.E.S.S.) Formation of buyer-seller trade networks in a quality- differentiated product market The theory of the distributive branch of public economics

4.15 – 4.45 Coffee Break 4.45 – 6.00

Session 8 Room 1: Room 2: Federation, Local Public Goods and More on Tax Competition Interregional Risk Sharing

Marc BAUDRY, Mathieu LEPRINCE and Cyriaque MOREAU (CREREG) Ron DAVIES and Christopher ELLIS (U. of Oregon) Bureaucratic bias and inefficiencies of local public expenditure: a theoretical and empirical inquiry in a Competition in taxes and performance requirements democratic context for foreign direct investment

Gregory BESHAROV (Duke U.) Jonathan HAMILTON (U. of Florida)

Influence costs in the provision of local public goods Tax competition and spatial competition: easing cross-border trading under different tax rules J. Ignacio CONDE-RUIZ (U. Bocconi), Marco CELENTANI and Klaus DESMET (U. Carlos III)

Incomplete interregional risk sharing with complete markets

Room 3: Multiregional and Urban Room 4: The Net and the Internet

Fabien MOIZEAU, Jean-Philippe TROPEANO and Soren BO NIELSEN (Copenhagen Business School) Jean-Christophe VERGNAUD (EUREQUA) and Christian KEUSCHNIGG (U. of St Gallen)

Informational neighborhood effects and the Start-ups, venture capitalists and the capital gains organisation of the city tax

Francisco MARTINEZ MORA (U. of Granada) Alain TRANNOY (THEMA)

Local provision of education with opting-out : the Internet, literacy and Earnings Inequality role of housing markets

Charles A.M.DE BARTOLOME (U. of Colorado) and Stephen L. ROSS (U. of Connecticut)

Comparison of urban equilibria: the conflict between efficiency and equity in the choice of the central city’s majority Room 5: Labour economics Room 6

Volker MEIER (CESifo)

Workfare in an efficiency wage model

Carmen ALVAREZ-ALBELO (U. de la laguna)

On-the-job-training- effects on working time and wage responses to changes in the social security payroll tax

Veronique REMY (LAEP)

On the efficiency of employment subsidies in limiting the effects of labour markets rigidities

Room 7: General Equilibrium 3 Room 8: Privatization, Transition 2

Antonio d'AGATA (U. of Catania) Maria E de BOYRIE (New Mexico State U.), Simon J. PAK (Penn State U.) and Star-shapedness of Richter-Aumann integral on a John S. ZDANOWICZ (Florida International U.) measure space with atoms: theory and economic applications Detecting abnormal pricing in international trade: the RUSSIA-USA case Cuong LE VAN (CERMSEM) and Yiannis VAILAKIS (IRES) Nauro F. CAMPOS and Francesco GIOVANNONI (U. of Newcastle) Existence of a competitive equilibrium in one sector growth model with heterogeneous agents and The looting investments Mathilde MAUREL (U. of Paris I) Manjira DATTA, Kevin REFFETT (Arizona State U.), Leonard MIRMAN (U. of Virginia) and On the way of EMU enlargements towards CEEC’s Olivier MORAND (U. of Connecticut) :what is the appropriate exchange rate regime?

Existence and characterisation of Markovian equilibrium in infinite horizon models with many agents and public policy

Room 9 Room 10: Social Choice 3

Mark R. JOHNSON (Neeley School of Business)

Comparison of three collective choice procedures by two complexities

Ipek OZKAL-SANVER and Remzi SANVER (Istanbul Bilgi U.)

Efficiency in the degree of compromise : a new axiom for social choice

Ayca E.G. KARA (Isik U.) and Murat R. SERTEL (Turkish Academy of Sciences)

Does majoritarian approval matter in selecting a social choice rule? : an exploratory panel study Saturday 6th

9.00 – 9.45

Plenary lecture : amphithéâtre Richelieu, Sorbonne John Weymark (Vanderbilt U.)

Strategy-Proof ness and the Tops-Only Property Chair: Serge Kolm (EHESS)

10.00 – 11.15

Session 9 Room 1 : Room 2: Political Economy 2 Topics in General Equilibrium 4

Eric LE BORGNE and Ben LOCKWOOD Pieter H.M. RUYS (U. of Tilburg) (U. of Warwick) A managed service economy with an equilibrium for Do elections always motivate incumbents ? marketable services Experimentation vs. career concerns Lionel de BOISDEFFRE (Cambridge U.) and Iide RIZZO (U. of Catania) Bernard CORNET (CERMSEM)

Independent authorities: the reasons for their Arbitrage with incomplete markets and asymmetric existence within a political economy information

Georges CASAMATTA (GREMAQ) and Wilfried Jean-Marc BONNISSEAU and Oussama LACHIRI ZANTMAN (LEN-CEBS and GREMAQ) (CERMSEM)

Citizen candidacy with asymmetric information Drèze’s criterion in a multi-periods economy with stock markets

Room 3 : Room 4 : Altruism and Public Policy Network and Coalition Formation

Haydee LUGO and Felipe PEREZ-MARTI Tone ARNOLD (U. of Hohenheim) and (I.E.S.A.) Myrna WOODERS (U. of Warwick)

Optimal taxation to form altruistic preferences in Dynamic club formation with coordination an economy with public goods Vjolica SADIRAJ,Frans van WINDEN (CREED) Carlos GARRIGA (FSU and CREB) and Fernando and Jan TUINSTRA (CeNDEF) SANCHEZ-LOSADA (CREB) A dynamic model of endogenous interest group sizes Does altruism affect the optimal fiscal policy ? and policy making

Al SLIVINSKI, Ignatius J. HORSTMANN Samir KAMAT, Frank PAGE (U. of Alabama) and (University of Western Ontario) and Myrna WOODERS (U. of Warwick) Kimberley A. SCHARF (University of Warwick) Networks and Farsighted Stability Can private giving promote economic segregation ? Session 9

Room 5 : Industrial Organisation 3 Room 6

Chair : Richard Arnould (U. of Illinois)

Francois BOLDRON (CORE)

Commodity taxation with non-linear pricing oligopoly

Flavio M. MENEZES and Paulo K. MONTEIRO(EPGE/FGV)

Corruption and auctions

Yutaka SUZUKI (Hosei U. and Stanford U.)

Managed competition as an incentive mechanism in supply relations

Room 7: Generations, Room 8 : the Old and the Young Integrations 1

Souresh SAHA and Arghya GHOSH (National U. of Singapore) Paola PROFETA (U. of Bocconi – U. of Pavia) An analysis of the effects of technology licensing on Demography, retirement and social security trade policy

Abdelkrim SEGHIR (CERMSEM Paris 1) Jill HOLMAN, Rebecca NEUMANN (U. of Wisconsin) and James ALM (Georgia State U.) Overlapping generations with incomplete markets: The numeraire case Globalisation and tax policy

Bruno DECREUSE and Bertrand WIGNIOLLE Oliver MORRISSEY (U. of Nottingham) and (EUREQua) Douglas R NELSON (Tulane U.)

Intergenerational conflicts and the minimum wage The role of the WTO in the transfer of policy knowledge on trade and competition 11.15 – 11.45 Coffee Break

11.45 – 1.00

Session 10

Room 1: Topics in Taxation 1 Room 2: Topics in Taxation 2

J.E. MULLAT (Tallinn Technical U. of Estonia) Alex POSSAJENNIKOV (U. Mannheim), Burkhard HEHENKAMP and A tax design from the principal of the maximum Wolfgang LEININGER (U. of Dormund) guaranteed happiness Evolutionary rent seeking J. Richard ARONSON, James DEARDEN, Vincent MUNLEY and David MYERS (Lehigh U.) Ebere AKOBUNDU, Andrew JOHNS, Nicolaus TIDEMAN and Prapaiporn Why public plans have taken on more risk than WUTTHICHAROEN (Virginia Tech) private plans The avoidable excess burden of broad-based US Wolfgang EGGERT (EPRU U. of Copenhagen) and taxes Martin KOLMAR (U. of Konstanz and Brown U.) Gareth D. MYLES (U. of Exeter) and Ase UYDURANOGLU (Istanbul Bilgi U.) Information sharing, multiple Nash equilibria and asymmetric capital tax competition Product choice, taxation and switching costs: an application to car production

Room 3 : Fiscal Policy Room 4 : Public Goods and Taxation

Myriam MORER (LIBRE) Michael PICKHARDT (Bergische U.)

Size difference as an obstacle to horizontal tax Fifty years after Samuelson’s “The Pure Theory of cooperation between local governments Public Expenditure”, what are we left with?

Anna CRETI and Bertrand VILLENEUVE Pedro H ALBUQUERQUE (CEA-IDEI-LEERNA) (Texas A&M International U.)

Energy and Environmental policy : strategic issues How bad is bad taxation ? Disintermediation and for the tax system illiquidity in a bank account debits tax model

Emmanuelle TAUGOURDEAU (EUREQUA) Cyril HARITON (GREMAQ) and Gwenael PIASER (CORE-UCL) Fiscal cooperation always sustainable when regions differ in size? Optimal taxation and imperfect labour market Session 10

Room 5: Transition Economies 2 Room 6

Donatella GATTI (MODEM)

European integration and employment: a new role for active fiscal policies ?

Giovanni FACCHINI (U. of Illinois)

Why join a common market? The political economy of international factor mobility in a multi-country setting

Peter HUBER (Austrian Institute for Economic Research) and Jon FIDRMUC (ZEI- CEPR )

The puzzle of rising regional disparities and falling migration rates during transition

Room 7: Empirical Economics Room 8 : Integrations 2

Xisco OLIVER-RULLAN (U. de las Islas Baleares) Wolfgang EGGERT (CoFE and CESifo) and and Amedeo SPADARO Laszlo GOERKE (IZA and CESifo) (DELTA and U. de las Islas Baleares) Fiscal policy, economic integration and unemployment Are Spanish governments really averse to inequality? A normative analysis using the 1999 reform of the Anne-Célia DISDIER (TEAM) and Spanish tax-benefit system as a natural experiment Thierry MAYER (TEAM)

Daniel MACEIRA (U. of Buenos Aires) How different is Eastern Europe? Structure and determinants of location choices by French firms in Income distribution and the public-private mix in eastern and western Europe health care provision: the Latin American case Mathieu CROZET (TEAM) and Pamina KOENIG- Iwan BARANKAY (U. of Warwick) SOUBEYRAN (CREST)

Decentralization, yardstick competition and the EU enlargement and industrial relocation within the quality of public goods CEEC’s