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Modelling Negotiated Decision Making: A Multilateral, Multiple Issues, Non-Cooperative Bargaining Model with Uncertainty
Carraro, Carlo; Sgobbi, Alessandra - C.E.P.R. Discussion Papers - 2007
The relevance of bargaining to everyday life can easily be ascertained, yet the study of any bargaining process is … on some dimensions of the bargaining process – asymmetries and uncertainties in particular – by using a non … most economic situations, uncertainty crucially affects also bargaining processes. Therefore, in our analysis, we introduce …
Persistent link: https://www.econbiz.de/10005791640
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A Stochastic Multiple Players Multi-Issues Bargaining Model for the Piave River Basin
Carraro, Carlo; Sgobbi, Alessandra - C.E.P.R. Discussion Papers - 2007
The objective of this paper is to investigate the usefulness of non-cooperative bargaining theory for the analysis of … multilateral, multiple issues, non-cooperative bargaining model of water allocation in the Piave River Basin, in the North East of … problem and conduct comparative static analyses to assess sources of bargaining power. Finally, we explore the implications of …
Persistent link: https://www.econbiz.de/10005791729
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Explaining the Favorite-Longshot Bias: Is it Risk-Love or Misperceptions?
Snowberg, Erik; Wolfers, Justin - C.E.P.R. Discussion Papers - 2010
The favorite-longshot bias describes the longstanding empirical regularity that betting odds provide biased estimates of the probability of a horse winning—longshots are overbet, while favorites are underbet. Neoclassical explanations of this phenomenon focus on rational gamblers who overbet...
Persistent link: https://www.econbiz.de/10008468517
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Competition between Intermediated and Direct Trade and the Timing of Disintermediation
Fingleton, John - C.E.P.R. Discussion Papers - 1996
This paper analyses competition between direct and intermediated trade. We show that middlemen’s supply and demand depend on both their bid and ask prices if sellers and buyers have the alternative of trading directly. Multiplicity also prevails. Direct trade does not constrain the market...
Persistent link: https://www.econbiz.de/10005661852
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Bank Networks: Contagion, Systemic Risk and Prudential Policy
Aldasoro, Iñaki; Delli Gatti, Domenico; Faia, Ester - C.E.P.R. Discussion Papers - 2015
We present a network model of the interbank market in which optimizing risk averse banks lend to each other and invest in non-liquid assets. Market clearing takes place through a tâtonnement process which yields the equilibrium price, while traded quantities are determined by means of a...
Persistent link: https://www.econbiz.de/10011252622
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Finite State Dynamic Games with Asymmetric Information: A Framework for Applied Work
Fershtman, Chaim; Pakes, Ariel - C.E.P.R. Discussion Papers - 2009
With applied work in mind, we define an equilibrium notion for dynamic games with asymmetric information which does not require a specification for players' beliefs about their opponent types. This enables us to define equilibrium conditions which, at least in principal, are testable and can be...
Persistent link: https://www.econbiz.de/10005016241
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Constrained Monopoly Pricing with Random Participation
Basaluzzo, Gabriel; Miravete, Eugenio J - C.E.P.R. Discussion Papers - 2007
We present a flexible model of monopoly nonlinear pricing with endogenous participation decisions of heterogeneous consumers. We make use of the moments that define the few self-selecting tariff options that are commonly used to implement the optimal nonlinear tariff to estimate how demand and...
Persistent link: https://www.econbiz.de/10005123885
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A User's Guide to Solving Dynamic Stochastic Games Using the Homotopy Method
Borkovsky, Ron N.; Doraszelski, Ulrich; Kryukov, Yaroslav - C.E.P.R. Discussion Papers - 2008
This paper provides a step-by-step guide to solving dynamic stochastic games using the homotopy method. The homotopy method facilitates exploring the equilibrium correspondence in a systematic fashion; it is especially useful in games that have multiple equilibria. We discuss the theory of the...
Persistent link: https://www.econbiz.de/10005123933
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Incomplete-Market Equilibria Solved Recursively on an Event Tree
Dumas, Bernard J; Lyasoff, Andrew - C.E.P.R. Discussion Papers - 2009
We develop a method that allows one to compute incomplete-market equilibria routinely for Markovian equilibria (when they exist). The main difficulty to be overcome arises from the set of state variables. There are, of course, exogenous state variables driving the economy but, in an incomplete...
Persistent link: https://www.econbiz.de/10005124234
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Comparison of Solutions to the Incomplete Markets Model with Aggregate Uncertainty
Den Haan, Wouter - C.E.P.R. Discussion Papers - 2008
This paper compares numerical solutions to the model of Krusell and Smith (1998) generated by different numerical algorithms. The algorithms have very similar implications for the correlations between different variables. Larger differences are observed for (i) the unconditional means and...
Persistent link: https://www.econbiz.de/10005136694