In a general setting of private information, the possibility (impossibility) theorem is said to be valid, if a balanced and ex post efficient mechanism exists (does not exist) which agents voluntarily participate at. Possibility and impossibility results are called robust if they hold for all...

Firms face the problem of choosing a debt maturity structure when financing an investment project. In addition, they have to decide which financing source to take. The aim of this article is firstly to give an explanation for the differing maturity choices by firms. As is shown below, the...

The paper develops a theoretical framework for studying conspicuous consumption. This is modeled as a device that signals the consumer's social status. Status is some function of the individual's rank in the wealth hierarchy. This approach makes it possible to distinguish between snob and...

In this paper we introduce markets for information about assets' payoffs in a two-period General Equilibrium Incomplete Markets Model. We consider asymmetric Walrasian equilibria with endogenous information allocations and analyze the interaction between demand for information and equilibrium...

We reconsider Tirole's framework of a three-tier principal-agent problem, in which he has shown that an incentive problem is caused by the possibility of monetary side payments between the agent and the middle -level supervisor. We consider the case where monetary transfers are not possible, but...

The financial structure of firms is diverse. Firms issue many different types of financial claims. This article focuses on the seniority structure of debt contracts. It is outlined under what conditions firms can improve the outcome of their financial decisions by choosing seniority structure....

The effects of unproductive lobbying have so far mainly been addressed by the public choice literature on rent-seeking and by Milgrom/Roberts' (1988,1990) work on influence activities in organizations. Our paper makes an attempt to incorporate lobbying into the simple principal-agent framework...

This paper extends the standard competitive adverse selection model by allowing for qualitatively different information structures of agents on the informed side of the market. Using the stylized framework of the market for used cars, we examine the welfare properties of equilibria under the...

Compared with the traditional public-finance approach of a monolithic fully informed planner, earmarking of taxation is less likely to be optimal if a principal-agent setting is considered, where taxing and spending are performed by two separate agents which are monitored by the parliament. We...

Zwei Experimente mit Entscheidungstrdgern aus der Praxis des Finanzmarkts sind durchgefuehrt worden, um die Frage zu klaeren, ob es Umstände gibt, unter denen der Fluch des Gewinners auch Kapitalmarktprofis gefdhrdet. Die Antwort ist ein klares "Ja". Der Fluch des Gewinners schlug nicht nur im...