Behavioral theories suggest that investor misperceptions and market mispricing will be correlated across firms. We use equity and debt financing to identify common misvaluation across firms. A zero-investment portfolio (UMO, Undervalued Minus Overvalued) built from repurchase and new issue firms...

The world over municipalities and cities often rely on capital markets for their long term financing needs. It is envisaged that such debt issues accelerate the development of cities. The rationale is that since the projects are supposed to benefit the public over time, the issuance of debt to...

In this paper are presented results of research conducted to identify sources of financing alternatives for local community. The study includes an analysis of the present situation on the financing of investments by local municipal bonds. The paper ends with the presentation of the benefits of...

In response to a request from the California Debt and Investment Advisory Commission, we propose a model to estimate default probabilities for bonds issued by cities. The model can be used with financial data available in Comprehensive Annual Financial Reports that cities are required to...

The paper argues that when a consumer searches for a lower price, a satisficing decision procedure equalizes marginal costs of search with its marginal benefit. The consumer can maximize the utility of his consumption-leisure choice with regard to the equality of marginal values of search....

Inflation is currently low and falling in the OECD area. A side effect of these facts is that they made harder the task of price index compilers. First of all, researchers and analysts are moving their attention from aggregate price dynamics to price differentials (among products, markets,...

The aim of this work is to establish the personal income distribution from the elementary constituents of a free market; products of a representative good and agents forming the economic network. The economy is treated as a self-organized system. Based on the idea that the dynamics of an economy...

Firms simultaneously set prices in a homogeneous-product market where uninformed consumers search for price information. Some uninformed consumers are local searchers who visit only one seller, possibly due to high search costs or bounded rationality; whereas others search sequentially with an...

This paper develops a matching model à la Pissarides (2000) in order to explain the basic facts of housing markets, most of all the variance in house prices. Price dispersion is basically due to both the ex-ante heterogeneity of the parties and the search costs of buyers and sellers. In fact,...

In a market where sellers are heterogeneous with respect of the quality of their good and are more informed than buyers, high quality sellers' chances to trade might depend on their ability to inform buyers about the quality of the goods they offer. We study how the strength of competition among...