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Inflation and the Informativeness of Prices
Ball, Laurence - 1993
This paper studies the welfare effects of the relative price variability arising from inflation. When agents interact … in anonymous markets, with customers buying from new suppliers each period, relative price variability benefits customers … informativeness of prices makes demand less price-elastic, thereby increasing markups. Both effects can be quantitatively significant …
Persistent link: https://www.econbiz.de/10012474695
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Imperfect Common Knowledge and the Effects of Monetary Policy
Woodford, Michael - 2001
This paper reconsiders the Phelps-Lucas hypothesis, according to which temporary real effects of purely nominal disturbances result from imperfect information, but departs from the assumptions of Lucas (1973) in two crucial respects. Due to monopolistically competitive pricing, higher-order...
Persistent link: https://www.econbiz.de/10012470042
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Differential Information and Dynamic Behavior of Stock Trading Volume
He, Hua - 1995
This paper develops a multi-period rational expectations model of stock trading in which investors have differential information concerning the underlying value of the stock. Investors trade competitively in the stock market based on their private information and the information revealed by the...
Persistent link: https://www.econbiz.de/10012473883
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Cadillac Contracts and Up-Front Payments : Efficient Investment Under Expectation Damages
Edlin, Aaron S. - 1994
This paper shows that up-front payments can play a crucial role in providing efficient investment incentives when contracts are incomplete. They can eliminate the overinvestment effect identified by Rogerson [1984] and Shavell [1980] when courts use an expectation damage remedy. This method...
Persistent link: https://www.econbiz.de/10012473989
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Information, Trading and Stock Returns : Lessons from Dually-Listed Securities
Chan, K.C. - 1994
This paper compares the intra-day patterns on the NYSE and AMEX of volatility, trading volume and bid-ask spreads for European dually- listed stocks, Japanese dually-listed stocks also listed in London, and Japanese dually-listed stocks not listed in London with American stocks of comparable...
Persistent link: https://www.econbiz.de/10012474182
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Do Short-Term Managerial Objectives Lead to Under- or Over-Investment in Long-Term Projects
Bebchuk, Lucian Arye - 1994
are concerned about the short-term stock price as well as the long-term stock price). Prior work has suggested that …
Persistent link: https://www.econbiz.de/10012474201
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Information and the Demand for Supplemental Medicare Insurance
Gertler, Paul - 1994
While the critical role of imperfect information has become axiomatic in explaining health care market failure, the theory is backed by little empirical evidence. In this paper we use a unique panel data set with explicit measures of information and an educational intervention to investigate the...
Persistent link: https://www.econbiz.de/10012474228
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The Economics of Adjustment
Caplin, Andrew - 1994
In this paper we argue that many topics in macroeconomics can be viewed as part of the broader theory of the economics of adjustment. We argue that existing approaches to the economics of adjustment take a very narrow view of the role of information. We outline an approach to this topic that...
Persistent link: https://www.econbiz.de/10012474245
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Information and Economic Efficiency
Arnott, Richard - 1993
Is an economy with adverse selection, moral hazard, or an incomplete set of risk markets "constrained" Pareto efficient? There are two sets of papers addressing this question, one asserting that, under seemingly quite general conditions, the economy is constrained Pareto efficient, the other (to...
Persistent link: https://www.econbiz.de/10012474409
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Equilibrium Unemployment as a Worker Screening Device
Nalebuff, Barry - 1993
We present a model of the labor market with asymmetric information in which the equilibrium of the' market generates unemployment and job queues so that wages may serve as an effective screening device. This happens because more productive workers -- within any group of individuals with a given...
Persistent link: https://www.econbiz.de/10012474599