We estimate the production function for agricultural output in Eastern Africa incorporating climate variables disaggregated into growing and non-growing seasons. We find a substantial negative effect of within growing season variance of precipitation. We simulate predicted climate change for the region and find a resulting output reduction of between 1.2% and 4.5%. We also find substantial potential for mitigating the effects of within growing season precipitation variability through conventional technologies such as flexible planting and rainwater harvesting that substantially exceeds the potential loss from predicted climate change.

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Pay-What-You-Want (PWYW) pricing schemes are becoming increasingly popular in a wide range of industries. We develop a model incorporating self-image into the buyer's utility function and introduce heterogeneity in consumption utility and image-sensitivity, which generates dierent purchase decisions and optimal prices across individuals. When a good is sold at a xed price higher than a threshold value, a price that the individual thinks is fair, the adoption of PWYW increases his utility and hence results in a weakly higher purchase rate. When a good is sold at a xed price lower than this threshold, however, PWYW can lead to a lower utility. This may result in a lower purchase rate and higher average price, in line with previously unexplained evidence from eld experiments. Moreover, an increase in the threshold value decreases the buyer's utility and may further lower the purchase rate, possibly resulting in a further increase in purchase price. Using simple assumptions of quadratic self-image function and uniformly distributed individual preferences, we investigate the conditions under which PWYW yields higher total welfare. JEL classication: D03, D11, D49, D64, D82.