Category Archives: Economics

Consider a country with two left-wing and two right-wing parties. In each side of the political spectrum one of the parties is a radical and the other is a moderate. Consider also that the moderates attract more voters than the […]

Unlike in perfectly competitive markets, there are many instances of economic situations in which selfish rational behavior does not imply an efficient allocation of resources. One example is the financing of a public good. Say some neighbors are asked to […]

Until the 80’s all Olympic Games took place in rich countries, with the only exception of Mexico 68. In the 80’s, Moscow 80, Seul 88 and Sarajevo 84 started a trend that encouraged bids from developing countries with the result […]

Mikel Lezaun is professor at the University of the Basque Country – UPV/EHU where he is director of the Mathematical Technology Transfer Group
Blood from donations is separated into three components: red cells, platelets and plasma, and one component […]

The last issue of the American Economic Review contains three articles on the performance of three different policies to fight poverty. Chetty et al. (2016) study a program in which families where moved from high-poverty neighborhoods to low-poverty […]

When I buy in a market I only deal with myself regardless of whether the market is competitive or in the hands of a monopoly. Given the price, I choose how much to buy. In an auction to get a […]

Energy sources in the modern world are mostly based on fossil fuels like oil, natural gas, and coal. They all share two main characteristics of the utmost importance for their economic analysis. First, they are depletable resources. The amount of […]

“We asked for workers. We got people instead.”
Max Frisch

In a past article, I reviewed the recent literature on the effects of immigration on the labor market. To sum up, it finds no significant negative effects on employment […]

I consider an offer for a gym membership and decide to accept it after being overconfident that I will use it regularly, but in the end I will not. In other words, I overvalue the offered contract. The opposite is […]

Standard supply and demand analysis shows that competitive markets will deliver a given commodity up to the point where costs (as perceived by producers) equal benefits (as perceiver by consumers). When both producers and consumers internalize all costs and benefits, […]