M. Angeles Caraballo

Relative prices and inflation: new evidence from different inflationary contexts

This paper analyses the relationship between inflation and relative price variability, in the direction of the latter, in two countries with very different inflationary experiences: Argentina and Spain. To address this objective, using disaggregated price indexes (the Wholesale Price Index for Argentina and the Consumer Price Index for Spain), we delimitate different inflationary regimes and compute a set of regressions for each country. Our results suggest evidence in favour of the non-neutrality of inflation (mostly in hyperinflation periods) and do not support either the menu costs or the signal extraction approaches. We also detect significant structural changes in the relationship depending on the inflationary regime.

The Relevance of Supply Shocks for Inflation: The Spanish Case

The methodology applied in this article to the Spanish economy is based on Ball and Mankiw (1995). These authors assume that a good proxy for supply shocks is the third moment of the price changes distribution. The main data used are the monthly consumer price indexes of each region, disaggregated in 57 categories, for the 1993–2005 period. We estimate the relation between mean inflation and the higher moments of the distribution, including several control variables. Our results point out that Spanish regions show a common pattern with regard to nominal rigidities, and that Spanish inflation is vulnerable to supply shocks.

Agents with Other-Regarding Preferences in the Commons

We present a unified approach to study the well-known problem of the use of a common-pool resource when the agents show other-regarding preferences. It is generally accepted nowadays that human behavior is influenced by social and psychological considerations which may lead the individuals to sacrifice monetary outcomes in the course of maximizing utility. This can have substantial economic consequences even for those who only pursue to improve their own benefit. The incorporation of preferences that accommodate this behavior into the problem leads us to model this type of situation as games with vector-valued utilities. Several types of agent are characterized depending on the importance that they assign to the components of their utility functions. We obtain the set of equilibria of the vector-valued game of the commons with two particular types of agent, namely, pro-social and pro-self agents. Some refinements of these equilibria are obtained by considering an additional decision rule that represents a conservative attitude of the agents. The most relevant result is that regardless of the behavior of the rest of the agents, only a pro-social agent is required to avoid the tragedy of the commons.

Equilibria with Vector-Valued Utilities and Preference Information. The Analysis of a Mixed Duopoly

This paper deals with the equilibria of games when the agents have multiple objectives and therefore, their utilities cannot be represented by a single value, but by a vector containing the various dimensions of the utility. Our approach is based on the incorporation into the model of information about the preferences of the agents, together with additional decision rules. This allows us to identify the equilibria according to this preferential information. The potential application of the theoretical results is shown with an analysis of a mixed oligopoly in which the agents value additional objectives other than their own benefit. These objectives are related to social welfare and to the profit of the industry. The flexibility of our approach provides a general theoretical framework to analyze a wide range of strategic economic models.

Equilibria with Vector-Valued Utilities and Preference Information

This paper deals with the equilibria of games when the agents have multiple objectives and therefore, their utilities cannot be represented by a single value, but by a vector containing the various dimensions of the utility. Our approach is based on the incorporation into the model of information about the preferences of the agents, together with additional decision rules. This allows us to identify the equilibria according to this preferential information. The flexibility of our approach provides a general theoretical framework to analyze a wide range of strategic economic models.