Lars P. Syll

If bonus or “incentive pay” schemes work so well for senior executives and bankers, why does everyone not get them? The conventional answer is that a bonus scheme or incentive plan will indeed encourage the recipients to make more money for the shareholders or clients on whose behalf they act … A classic paper on the “principal-agent problem” … by Bengt Holmstrom and Paul Milgrom pointed out that the conventional answer makes the mistake of assuming that jobs are simple and...

What is love (personal)  [embedded content]  [embedded content] div{float:left;margin-right:10px;} div.wpmrec2x div.u > div:nth-child(3n){margin-right:0px;} ]]> Advertisements

How rigged markets make the rich richer Markets are never just given. Neither God nor nature hands us a worked-out set of rules determining the way property relations are defined, contracts are enforced, or macroeconomic policy is implemented. These matters are determined by policy choices. The elites have written these rules to redistribute income upward. Needless to say, they are not eager to have the rules rewritten — which means they also have no...

Former Swedish minister of finance showing off … Anders Borg, the former minister of finance in Sweden, shocked the guests at a party last weekend in the archipelago of Stockholm. According to sources, Borg exposed his penis, threw sexist slurs at female guests and threatened the host. ”I feel a lot of disappointment and regret my behaviour”, Borg wrote in a Facebook post. A party in the archipelago of Stockholm last Friday got out of hand. One of the...

 [embedded content] Evert och Sven-Bertil i all ära, men för mig är det Tottes version som gäller! div{float:left;margin-right:10px;} div.wpmrec2x div.u > div:nth-child(3n){margin-right:0px;} ]]> Advertisements

The Venice of the North (personal) For the third time in a year yours truly will make a guest appearance in Hamburg — The Venice of the North. Regular blogging will be resumed next weekend. Tschüss! [embedded content] div{float:left;margin-right:10px;} div.wpmrec2x div.u > div:nth-child(3n){margin-right:0px;} ]]> Advertisements

Ways in which economists overbid their cards  [embedded content] div{float:left;margin-right:10px;} div.wpmrec2x div.u > div:nth-child(3n){margin-right:0px;} ]]> Advertisements

Along with the Arrow-Debreu existence theorem and some results on regular economies, SMD (Sonnenschein-Mantel-Debreu) theory fills in many of the gaps we might have in our understanding of general equilibrium theory … It is also a deeply negative result. SMD theory means that assumptions guaranteeing good behavior at the microeconomic level do not carry over to the aggregate level or to qualitative features of the equilibrium. It has been difficult to make progress on the...

Om kvantitet och kvalitet i högskolevärlden Den som kommer in på högskolan ska också gå ut med avlagd examen, anser regeringen. Enligt Helene Hellmark Knutsson (S), minister för högre utbildning, ska universitet och högskolor “se till att när man väl kommit in på sin utbildning, har sin behörighet, att man också får det stöd man behöver för att fullfölja sina studier”. Det låter lite väl enkelt. Högskolelagens nuvarande formulering om att högskolorna ska...

The conundrum of unknown unknowns Short-term weather forecasting is possible because most of the factors that determine tomorrow’s weather are, in a sense, already there … But when you look further ahead you encounter the intractable problem that, in non-linear systems, small changes in initial conditions can lead to cumulatively larger and larger changes in outcomes over time. In these circumstances imperfect knowledge may be no more useful than no...