eScholarship provides open access, scholarly publishing services to the University of California and delivers a dynamic research platform to scholars worldwide. Department of Economics, UCSB UC Santa Barbara Peer Reviewed Title: Soldiers of Fortune Author: Bergstrom, Ted , University of California, Santa Barbara Publication Date: 07-01-1986 Series: Ted Bergstrom Papers Permalink: http://escholarship.org/uc/item/1r7912t0 Additional Info: This paper was published in 1986 in Essays in Honor of K.J. Arrow, edited by Walter P. Heller and Ross Starr. Keywords: occupational choice, lottery, voluntary army Abstract: This paper shows that if workers have identical wealths, abilities, and preferences then a draft lottery is Pareto superior to a voluntary army. It also shows that if being a civilian is a "normal good", then the optimal pay schedule will be such that people prefer not being chosen for the army. The paper shows how this idea extends to occupational choice in general and shows that pure gambles taken prior to occupational choice can substitute for lotteries that determine one's occupation. This paper repairs what I think is a major flaw in standard general equilibrium theory, which assumes away the nonconvexity of preferences that follows from the discreteness of occupational choice. Copyright Information: All rights reserved unless otherwise indicated. Contact the author or original publisher for any necessary permissions. eScholarship is not the copyright owner for deposited works. Learn more at http://www.escholarship.org/help_copyright.html#reuse