Gamson’s law and hedonic games

This note adds one celebrated coalition formation game due to Gamson (Am Soc Rev 26:373–382 1961a, Am Soc Rev 26:565–573, 1961b) in the list of applications of the theory of hedonic games explored by Banerjee et al. (Soc Choice Welf 18:135–153, 2001) and Bogomolnaia and Jackson (Games Econ Behav 38: 204–230, 2002). We apply their results to study the original Gamson game and offer extensions both to a multi-dimensional characteristics space and to an infinite number of players.     

The economics of adding and subdividing independent risks: Some comparative statics results

In this paper we address the problem of determining whether adding independent risks or subdividing them is a good substitute for insurance. Despite the fact that accepting more i.i.d. risks increases total risk, it is shown that some risk-averse decision makers can rationally reduce their demand for insurance by doing so. Similarly, a better diversified portfolio of i.i.d. risky assets can rationally be more insured, even if diversification is a risk-reduction scheme. We derive conditions sufficient to obtain unambiguous comparative statics results. Assuming that absolute risk aversion is decreasing and that the fourth derivative of the utility function is positive, we show that diversification is an exceptionally good substitute for insurance. Under the same conditions, adding independent risks to wealth reduces the demand for insurance on each unit.     

Gender inequalities in European unemployment benefit systems

The most important structural change which has occurred on the labour market over the past 30 years is the sustained and continued growth of female labour supply. Two-earner couples have become a majority in most European countries and lone parents, mostly women, are also on the rise. On the other hand, since 1975, labour market policies have altered the quality and nature of employment in Europe by promoting atypical forms of employment where women are overrepresented. The analysis has shown us that atypical employment results in restricted access to unemployment benefits. Moreover, combining the presence of more stringent conditions with derived rights results in more and more women being dependent upon their spouses for financial as well as social protection and can even have a disincentive effect on formal labour market participation.