Local interactions refer to social and economic phenomena where individuals' choices are influenced by the choices of others who are close to them socially or geographically. This represents a fairly accurate picture of human experience. Furthermore, since local interactions imply particular...

The theory of learning in games explores how, which, and what kind of equilibria might arise as a consequence of a long-run nonequilibrium process of learning, adaptation, and/or imitation. If agents’ strategies are completely observed at the end of each round (and agents are randomly matched...

We choose between alternatives without being fully informed about the rewards from different courses of action. In making our decisions, we use our own past experience and the experience of others. So the ways in which we interact - our social network - can influence our choices. These choices...

Biconcavity is a simple condition on inverse demand that corresponds to the ordinary concept of concavity after simultaneous parameterized transformations of price and quantity. The notion is employed here in the framework of the homogeneous-good Cournot model with potentially heterogeneous...

Biconcavity is a simple condition on inverse demand that corresponds to the ordinary concept of concavity after simultaneous parameterized transformations of price and quantity. The notion is employed here in the framework of the homogeneous-good Cournot model with potentially heterogeneous...

Previous evidence shows that better insurance coverage increases medical expenditure. However, formal studies on the effect of spending on health outcomes, and especially mental health, are lacking. To fill this gap, we reanalyze data from the Rand Health Insurance Experiment and estimate a...

We study a negotiation model with a disagreement game between offers and counteroffers. When players have different time preferences, delay can be Pareto efficient, thereby violates the presumption of the Hicks Paradox. We show that all equilibria are characterized by the extreme equilibria....

This paper examines a dynamic process of unilateral and joint deviations of agents and the resulting stochastic evolution of social conventions. Our model unifies stochastic stability analysis in static settings, including normal form games, network formation games, and simple exchange...

An evolutionary style model of recontracting is given which guarantees convergence to core allocations of an underlying cooperative game. Unlike its predecessors in the evolution/learning literature, this is achieved without assumptions of convexity of the characteristic function or a reliance...

We prove existence of stationary Markov perfect equilibria in an infinite-horizon model of legislative policy making in which the policy outcome in one period determines the status quo for the next. We allow for a multidimensional policy space and arbitrary smooth stage utilities, and we assume...