Anastasios Koukoumelis

A voluntary contribution experiment with one-way communication and income heterogeneity

One-way communication has been found to increase contributions in linear Voluntary Contribution Mechanisms (VCMs). We confirm the robustness of this result in the presence of income heterogeneity. Our analysis indicates that the communicator directs the members of his group to the highest pay-off that they may attain.

Aids and Dualism : Ethiopia's Burden Under Rational Expectations

An AIDS epidemic threatens Ethiopia with a long wave of premature adult mortality, and thus with an enduring setback to capital formation and economic growth. The authors develop a two-sector model with three overlapping generations and intersectorally mobile labor, in which young adults allocate resources under rational expectations. They calibrate the model to the demographic and economic data, and perform simulations for the period ending in 2100 under alternative assumptions about mortality with and without the epidemic. Although the epidemic does not bring about a catastrophic economic collapse, which is hardly possible in view of Ethiopias poverty and high background adult mortality, it does cause a permanent, downward displacement of the path of output per head, amounting to 10 percent in 2100. An externally funded program to combat the disease is socially very profitable.

On the measurement of convergence as an ongoing process

Time-varying parameter techniques are commonly used to examine whether convergence in income has been a stable process. This article incorporates additional local features to a model studying 14 EU countries, thereby providing better estimates of the current state of the system when the relative income series are highly nonlinear.