In order to investigate strategic interactions between a "global north" and a "global south" we introduce a two-country extension of the model in Golosov et al. (2014). We consider different transfers between the two regions, including transfers that can improve the abatement technology. Our model can accommodate several kinds of heterogeneity, including in preferences, time...

We propose a mean-field game (MFG) set-up to study the dynamics of spatial agglomeration in a continuous space-time framework where trade across locations may follow a broad class of static gravity models. Forward-looking intertemporal utility-maximizing agents work and migrate in a twodimensional geography and face idiosyncratic shocks. Equilibrium wages and prices depend on their common...

This special issue brings together five papers selected for their technical depth and contribution to contemporary economic research. The collection comprises three theoretical contributions and two at the theory-data interface, addressing questions from liquidation design in financial networks to spatial growth, incomplete-market equilibria, labour search with endogenous unemployment-insurance (UI) take-up, and internet-access complementarities.The contributions share...

We study optimal firm behavior under irreversible pollution risk for a general class of models with irreversible local pollution. Irreversibility comes from the decay rate of pollution dropping to zero above a pollution level featuring non-convexity. In addition, the firm can instantaneously move from a reversible to an irreversible pollution mode, following a Poisson process....

Conventional agriculture not only neglects but also harms the ecosystem services provided by biodiversity, inducing a negative feedback loop. In a theoretical inspired by agroforestry (“agriculture with trees”), a common agroecological practice in developing countries, we highlight how the choice between expanding agricultural land and retaining forest land is shaped by the bidirectional relationship between...

We develop an Integral Transformation Method (ITM) for the study of suitable optimal control and differential game models. This allows for a solution to such dynamic problems to be found through solving a family of optimization problems parametrized by time. The method is quite flexible, and it can be used in several economic applications where...

While Ellis, Reid, and Kramer’s life history framework is convincing in explaining individual variation in life history strategies, it has certain limitations, which we discuss – drawing notably on the economic theory of fertility choice. In particular, we suggest that ambient cues to extrinsic mortality alone are not sufficient to trigger sustained net fertility decline.

The dynamics of capital distribution across space are an important topic in economic geography and, more recently, in growth theory. In particular, the spatial AK model has been intensively studied in the latter stream. It turns out that the positivity of optimal capital stocks over time and space for any initial capital spatial distribution has...

We examine the role of land use and biodiversity in the emergence of zoonotic diseases through a stylized model of farmers' decision-making. Farmers interact with biodiversity via two pathways: expanding agricultural land and direct harvesting for consumption. Their consumption preferences follow a CES (constant elasticity of substitution) framework, allowing for any degree of substitution or...

Prior to the Covid-19 crisis, the integration of epidemiology and economics that is, economic epidemiology modelling (epi-econ), was relatively limited. The emergence of the Covid-19 crisis has prompted an unprecedented surge in this literature. This paper identifies and develops the main conceptual and modelling challenges involved in the expanding epi-econ stream, with a particular attention...