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on Contract Theory and Applications |
| By: | Florian H. Schneider |
| Abstract: | Firms often discourage certain categories of individuals from buying their products, in contrast with typical assumptions about profit maximization. This paper provides a potential rationale for such firm behavior: consumers seek to signal that they have “good” moral values to themselves and others by avoiding products popular among people with “bad” values. In laboratory experiments, I provide causal evidence that demand for a product is lower if its customer base consists of individuals with undesirable moral values. This effect occurs for both observable and unobservable consumption and for products that do not possess any inherent moral or undesirable qualities. |
| Keywords: | Moral values, social image, self-image, signaling, consumption, experiments |
| JEL: | D12 C91 M3 |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:zur:econwp:367&r=all |
| By: | Prager, Daniel; Burns, Christopher; Tulman, Sarah; MacDonald, James |
| Abstract: | Farming can be a risky endeavor. Weather, pests, and disease can diminish the output from a field or herd. Changes in prices can reduce revenues or increase costs. Farmers may manage the risks from market price fluctuations by using agricultural derivatives, such as futures and options contracts, and committing some production to marketing contracts. This study uses data from the 2016 Agricultural Resource Management Survey to describe the use of futures, options, and marketing contracts by producers, with a primary focus on corn and soybeans. |
| Keywords: | Agribusiness, Marketing |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:ags:uerser:305690&r=all |
| By: | Haufler, Andreas (University of Munich and CESifo); Perroni, Carlo (University of Warwick and CESifo) |
| Abstract: | We offer a new explanation for why taxes have become less progressive in many countries in parallel with an increase in income inequality. When performancebased compensation differentials are needed to incentivize effort, redistribution through progressive income taxes becomes less precisely targeted. Taxation reduces after-tax income inequality but undermines incentive contracts, lowering effort and raising pre-tax income differentials. Market integration can widen the spread of project returns and make contract choices more responsive to changes in the level of taxation, resulting in a lower optimum income tax rate even when individuals are not inter-jurisdictionally mobile. |
| Keywords: | Redistributive Taxation; Performance-based Contracts; Market Integration JEL Classification: H21, F15, D63 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:cge:wacage:492&r=all |