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Revealed Preferences in a Sequential Prisoners' Dilemma : A Horse-Race between Six Utility Functions
Miettinen, Topi - 2020
We experimentally investigate behavior and beliefs in a sequential prisoner's dilemma. Each subject had to choose an action as first mover and a conditional action as second mover. All subjects also had to state their beliefs about others' second-mover choices. Using these elicited beliefs, we...
Persistent link: https://www.econbiz.de/10012854501
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Behavioral Indifference Curves
Komlos, John - 2014
According to the endowment effect there is some discomfort associated with giving up a good, that is to say, we are willing to give up something only if the price is greater than the price we are willing to pay for it. This implies that the indifference curves should designate a reference point...
Persistent link: https://www.econbiz.de/10013051281
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Afriat's Theorem for General Budget Sets
Forges, Francoise - 2006
Afriat (1967) showed the equivalence of the strong axiom of revealed preference and the existence of a solution to a set of linear inequalities. From this solution he constructed a utility function rationalizing the choices of a competitive consumer. We extend Afriat's theorem to a class of...
Persistent link: https://www.econbiz.de/10012780251
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Afriat's Theorem for Indivisible Goods
Forges, Francoise; Iehlé, Vincent - 2021
We identify a natural counterpart of the standard GARP for demand data in which goods are all indivisible. We show that the new axiom (DARP, for “discrete axiom of revealed preference”) is necessary and sufficient for the rationalization of the data by a well-behaved utility function. Our...
Persistent link: https://www.econbiz.de/10013315672
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Bank Networks : Contagion, Systemic Risk and Prudential Policy
Aldasoro, Iñaki - 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/10013028909
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Contagion in Financial Networks : A Threat Index
Demange, Gabrielle - 2015
-over effects. Building on a simple model, this paper introduces a measure of the spill-over effects that a bank generates when it … defaults. The measure is based on an explicit criterion, the aggregate debt repayments, and is bank's specific, affected by the … bank's characteristics and links to other banks. Such measure can be useful to a regulator to determine in which banks cash …
Persistent link: https://www.econbiz.de/10013023198
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Risk-Sharing and Contagion in Networks
Cabrales, Antonio - 2014
We investigate the trade-off between the risk-sharing gains enjoyed by more interconnected firms and the costs resulting from an increased risk exposure. We find that when the shock distribution displays “fat” tails, extreme segmentation into small components is optimal, while minimal...
Persistent link: https://www.econbiz.de/10013055377
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Subsidizing National Champions : An Evolutionary Perspective
Aubert, Cecile - 2008
A national-champions-related industrial policy has become (again) en vogue among European politicians. Against this background, our work orders different types of national champions along the industry lifecycle. Different types of locally bound externalities appear along the lifecycle. In a...
Persistent link: https://www.econbiz.de/10012770493
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Concentrating on the Fall of the Labor Share
Autor, David H. - 2017
The recent fall of labor's share of GDP in numerous countries is well-documented, but its causes are poorly understood. We sketch a “superstar firm” model where industries are increasingly characterized by “winner take most” competition, leading a small number of highly profitable (and...
Persistent link: https://www.econbiz.de/10012961079
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A Unified Theory of Firm Selection and Growth
Arkolakis, Costas - 2021
This paper develops a theory of firm selection and growth and embeds it into an international trade framework of …
Persistent link: https://www.econbiz.de/10013316364