In November 2001, a TV program showed that many large Dutch construction companies participated in price fixing. We analyze how one such company, Heijmans, reacted to the reputation crises after the TV program by introducing a code of conduct. We present the outcomes of a questionnaire survey...

Corporations discover that social responsibility pays off. However, sometimes doing what is ethical will prove costly to a company. The purpose of this article is to clarify this trade-off by developing an economic model that describes the choice between profits and principles. The model is used...

In this paper, we continue to explore the equilibrium theory under ambiguity. For a model of a pure exchange and asymmetric information economy with a measure space of agents whose exogenous uncertainty is described by a complete probability space, we establish a representation theorem for a...

This paper offers a dynamic model of the foreign exchange market where some investors in the market are more informed than others. By adjusting the proportion of informed investors in the market, it is shown that the disconnect between macroeconomic variables and the exchange rate is sensitive...

In this paper, we study asymmetric information economies consisting of both non-negligible and negligible agents and having ordered Banach spaces as their commodity spaces. In answering a question of Herves-Beloso and Moreno-Garcia in [17], we establish a characterization of Walrasian...

We analyze the effects of CEOs' layoff risk on their risk choice while overseeing a firm. A CEO, whose managerial ability is unknown, is fired if her expected ability is below average. Her risk choice changes the informativeness of output and market's belief about her ability. She can decrease...

This paper aims at establishing a relationship between disparity of information and the probability of speculative attack in explaining the Asian crisis. We apply the general framework of Markov-Switching models to the differential of interest rates (DIR), subsequently in Indonesia and Malaysia....

The literature analyzing games where some players have private information about their "types" is usually based on the duality of "good" and "bad" types (GB approach), where "good" type denotes the type with better quality. In contrast, this paper analyzes a signalling game without types...

This paper analyzes debt-equity choice for financing a two-stage investment when a firm’s insiders have private information about the firm’s expected earnings. When private information is one-dimensional (for example when short-term earnings are common knowledge while long-term earnings are...