Julio R. Robledo

Geography of the Family

We study the residential choice of siblings who are altruistic towards their parents. If some siblings moves further away, he or she can shift some of the burden of takin care for the parents to his or her siblings. Thus, siblings have a strategic incentive to move away that only children do not have. Siblings locate futher away from parents than only children, and, for some preferences, asymmetric location patterns emerge. These theoretical predictions are also confirmed by empirical data.

Self‐Insurance and Self‐Protection as Public Goods

Most pure public goods like lighthouses, dams, or national defense provide utility mainly by insuring against hazardous events. Our paper focuses on this insurance character of public goods. As for private actions against hazardous events, one can distinguish between self-insurance (SI) and self-protection (SP) also in the context of public goods. For both cases of SI and SP we analyze efficient public provision levels as well as provision levels resulting from Nash behavior in a private provision game. An interesting aspect of considering public goods as insurance devices is the interaction with market insurance. It turns out that the availability of market insurance reduces the provision level of the public good for both, the public and the private provision, regardless of whether we consider SI or SP. Moreover, we show that Nash behavior has always a larger impact than the availability of market insurance.

An empirical analysis of voluntary payments for information goods on the Internet

This paper presents results from a field study on voluntary contributions for an information public good provided via the Internet (an electronic newsletter for authors). Whereas the standard private provision model predicts that individuals contribute less if other individuals contribute more, we find that readers are more likely to pay the more they expect others to give. This result is consistent with more refined private provision models or with fairness models. We also find individuals contribute more the older they are. Women are also more cooperative in this sense, while income has no significant effect.

Public Self-Insurance and the Samaritan's Dilemma in a Federation

Motivated by recent disasters, this article analyzes the risk-sharing aspect in a federation. The regions can be hit by a shock leading to losses that occur with an exogenous probability and in a stochastically independent way. The regions can spend effort on self-insurance to reduce the size of the loss. Being part of a federation has two countervailing welfare effects. On one hand, there is the well-known welfare increase due to risk pooling. On the other hand, the self-insurance effort is a public good, because all regions benefit from the reduction of the loss. There exists a Samaritan’s dilemma kind of effect whereby regions reduce their self-insurance effort potentially leading to an overall welfare decrease. The central government can solve this dilemma by committing to fixed rather than to variable transfers. This induces regions that behave noncooperatively to choose the efficient level of self-insurance effort.