This paper shows that asymmetric information in capital goods development can enhance long-run economic growth. This growth-enhancing role occurs when new capital goods are highly productive and high-quality new capital goods are not much more expensive to develop than low-quality capital goods....

We analyse the coordination problem in the labour market by endogenizing the matching function and the wage share. Each firm posts a wage to maximize the expected profit, anticipating how the wage affects the expected number of applicants. In equilibrium workers apply to firms with mixed...

In a two-player alternating-offer bargaining model, if one player can destroy the surplus to be allocated, then the value to bargain for is endogenous, except at the beginning. Even with complete information, the model has perfect equilibria with delayed agreement and/or surplus destruction. The...

In this lecture, I explain what the microfoundations of money are about and why they are necessary for monetary economics. Then, I review recent developments of a particular microfoundation of money, commonly known as the search theory of money. Finally, I outline some unresolved issues.