The widespread view that externalities and commons generate market imperfections is usually associated with the perception of the market economy as the central resource allocation mechanism whereas such imperfections come from the periphery of the economic system and are primarily disturbing the efficiency of resource allocation. However, it is increasingly recognized that the economy is deeply embedded in the social fabric and that planetary boundaries delineate the sustainable operation of the social and economic spheres. Moreover, distributional issues appear impossible to ignore in policies addressing these problems. This project aims at developing a conceptual framework in which externalities and commons are at the core of the analysis, with new models in which market instruments are only a subset of relevant tools, and in which fairness issues are as central as efficiency considerations. Three domains of applications will be investigated. The first is health policy, which will be addressed through a model of inequalities in the pandemic and with a new survey eliciting people’s values and preferences over health, consumption, and social interactions. The second domain is climate policy, for which second-best policy under constraints about transfers and about the distribution of emission permits raise difficult questions about differential carbon prices, and this project will also seek to introduce additional commons such as biodiversity and social stability into integrated assessment models used for cost-benefit analysis of mitigation policies. The third domain is the study of the optimal division of labor between private action and public interventions - an increasingly important topic at a time when public interventions are contested and insufficient, whereas many private actors, especially business firms and investors, coalesce around multiple initiatives embracing social and environmental responsibility.

The energy transition cannot be achieved without dramatic changes in our society. The starting point of this research is the observation that the emergence of a huge number of non-governmental organizations (NGOs), particularly in the field of environment, constitutes a prominent lever for transforming markets, society and public policies. NGOs are now central actors of policy-making processes as well as initiators of public debates about the needs of environmental policies. They play a critical role in public politics by providing people with information about the environmental state of the world, bringing social and environmental issues to public awareness, and mobilizing support for political action on these issues. They also strongly influence corporate incentives to self-regulate. A better understanding of NGOs behavior and strategies seems thus crucial. However, their analysis has been so far mostly neglected in the economic literature. Most existing works are in political science, sociology, socio-economics, management, and business ethics. And yet economists have tools and approaches (e.g., experimental economics, political economy, and information economics), which could efficiently complement the existing literature. The project will seek to fill this gap. The project addresses six general questions: (1) How can green NGOs’ objectives and constraints be understood and thus modeled? (2) What are the specific strategies and tactics used by NGOs when interacting with corporations? (3) How do they influence corporate behavior? How do they affect firms’ profits? (4) How do they influence consumers and other stakeholders’ perceptions of corporate environmental and social behavior? (5) How and why do NGOs compete with each other, cooperate with corporations, governments or get involved in international negotiations? (6) Do green NGOs substitute or complement public regulators and how their strategies contribute to the energy transition? The research will combine theory and evidence. More specifically, we will develop theoretical models aiming at explaining NGOs strategies; we will construct a dataset describing NGO informational behavior, their funding sources and activities (extracted from press releases, NGOs websites). These data will then be used to test the predictions of some of the models. Although our approach is mostly economic, the main novelty of the project is the acknowledgment that green NGOs are specific political-economic agents whose objectives deserve to be thoroughly examined. In order to provide the basis for a sound understanding of the motive for NGOs objectives, claims and behaviors, the project will also take into consideration the findings of the sociological literature on this topic. The partnership includes highly skilled environmental economists, with deep expertise in industrial organization, welfare economics, behavioral economics and game theory. Until now, some of them have started working on this topic either in isolation or in bilateral collaboration. The ANR support will offer them the opportunity and the means to benefit from synergies by meeting regularly and working together in various configurations.

Contemporary economies in Europe are constantly seeking ways to accelerate growth and achieve sustainable economic development. In this context, public policies play a crucial role: Among them are competition policy to monitor the behavior of firms, and procurement and regulatory policies which are designed to organize specific sectors. Recognizing the importance of public intervention as a major determinant of growth is only a starting point. Achieving good public policies requires the supervision of a public authority which implements efficient mechanisms in order to regulate the corporate behavior in firms. How these tools should be designed and implemented is subject to economic debate. Over the last 30 years, the literature focusing on industrial economics has proposed theoretical rules to researchers on how markets should be organized and regulated in order to maximize social welfare. Very few empirical tests of these theories have been proposed however. The aim of this research project is to attempt to bridge the gap between theory and reality, so that the tools of the economists can be understood and used by practitioners. This project has four main objectives: (i) To propose guidelines that help separating regulatory models that represent the economic reality of an industry from those that describe the optimal mechanisms to which the organization of the industry should aim to (positive versus normative analysis), (ii) to propose original microeconomic, statistical and econometric methodologies which allow representing the characteristics of the markets under scrutiny, (iii) to collect data and construct original databases that will be run in this current project and could be useful in future research, and (iv) to derive results that are useful for practitioners. To illustrate the variety of issues within the general theme of the project, we can raise the following questions: To what extent do the rules of competition in the markets affect the decisions of firms to improve their productivity and efficiency? Does competition guarantee low prices to consumers? Do the liberalization of utility industries and the search for new provision modes by public authorities accelerate the use of outsourcing? What are the efficiency conditions of competition for the market? How should the relationships between the governments and firms be organized in public-private partnerships? How should optimal regulatory rules be designed in order to maximize social welfare? Are regulators competent, sophisticated and benevolent enough to implement optimal regulatory rules? Should mergers between firms be allowed in industries where competition for the market is organized? These are just some examples of issues where an approach involving economists working in different fields such as industrial organization, contract theory, competition policy, and applied econometrics is of major interest. The Université Paris 1, Paris School of Economics, and GREMAQ offer a set of recognized talent in these disciplines and the first objective of this project is to unite the forces inside a team around these issues, which we think are important both in terms of research and public policy.

The project will study the poorly documented relationship between geographic and social mobility and their consequences on spatial inequalities. In particular, it will analyze the sources of spatial sorting as well as the role of transportation infrastructure on geographic and social mobility, for two countries with different spatial and political organizations, France and the United States, and for two contrasting periods, the 19th century and the second half of the 20th century. The research team will adopt a multidisciplinary approach and will rely on rich, localized and original historical data, such as information on the evolution of travel speeds. In particular, the project will focus on the role of transportation infrastructure development on local economic and demographic growth, the relocation of individuals and families across space, and access to opportunities (education and work).

Visual confidence refers to our ability to estimate the correctness of our visual perceptual decisions. As compared to other forms of metacognition, meta-perception has attracted a burst of studies recently, no doubt because perception already benefits from strong theoretical frameworks. We have recently refined these existing frameworks by proposing to clearly distinguish sensory evidence from some “confidence evidence” that drives the confidence decision. The problem now is to characterize the properties and consequences of this confidence evidence, and this is the aim of the present proposal. As the number of studies grows, it becomes clear that visual confidence is not simply a noisy estimate of the perceptual decision, but instead depends on a large number of factors. We have identified four axes that we believe will contribute to shape confidence evidence: (1) individual variability, (2) task accessibility, (3) global confidence, and (4) perceptual learning. The purpose of the first axis is to understand which cues are used for confidence, and for this purpose, we will study confidence variability across individuals. Some of the idiosyncratic variability in confidence judgment efficiency might come from a variable temptation to exaggerate the impact of stimulus noise on the estimation of one own performance. In the second axis, we will try to understand what in a task determines the accessibility to visual confidence. In particular, we will test the hypothesis that more high-level tasks, such as face identification, lead to better confidence efficiency that low-level tasks, such as detecting whether two line segments are aligned. The aim of the third axis is to understand how individuals construct a sense of confidence for a task as a whole, not for a single isolated judgment. We will start by carefully studying how confidence builds up within a set of stimuli and compare how such a global confidence compares with a single decision confidence. Finally, in the fourth axis, we will study how perceptual learning benefits from visual confidence. In particular, we will test the extent to which confidence evidence can be seen as an internal error signal that can act as a proxy for an external feedback. We believe that a better understanding of these four fundamental aspects of confidence evidence will help us derive an accurate and useful model of visual confidence, and ultimately of metacognition.