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On the relevance of irrelevant information
Parakhonyak, Alexei - 2009
This paper analyses the role of information in the search process. Ibuild a simple model of a good with two random attributes with somejoint probability distribution. I consider seemingly unimportant changesin this distribution, i.e. changes which neither affect expected utility norits variance....
Persistent link: https://www.econbiz.de/10011379165
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Negative reciprocity and the interaction of emotions and fairness norms
Reuben, Ernesto; Winden, Frans A. A. M. van - 2005
This experimental study investigates how behavior changes after punishment for an unkind action. It also studies how fairness perceptions affect the reaction to punishment and whether this effect is consistent across repeated play and role experiences. A repeated version of the power-to-take...
Persistent link: https://www.econbiz.de/10011343297
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The economics of altruistic punishment and the demise of cooperation
Egas, Martijn; Riedl, Arno - 2005
Explaining the evolution and maintenance of cooperation among unrelated individuals is one of the fundamental problems in biology and the social sciences. Recent experimental evidence suggests that altruistic punishment is an important mechanism to maintain cooperation among humans. In this...
Persistent link: https://www.econbiz.de/10011343948
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Inverse adverse selection : the market for gems
Dari Mattiacci, Giuseppe; Onderstal, Sander; Parisi, … - 2010
This paper studies markets plagued with asymmetric information on the quality of traded goods. In Akerlof's setting, sellers are better informed than buyers. In contrast, we examine cases where buyers are better informed than sellers. This creates an inverse adverse selection problem: The market...
Persistent link: https://www.econbiz.de/10011382752
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On existence of private unemployment insurance with advance information on future job losses
Denderski, Piotr; Stoltenberg, Christian - 2021
We study the existence of a profitable unemployment insurance market in a dynamic economy with adverse selection rooting in information on future job losses. The new feature of the model is that the insurer and workers interact repeatedly. Repeated interactions make it possible to threaten...
Persistent link: https://www.econbiz.de/10012545133
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Optimal incentives without expected utility
Gonzalez Jimenez, Victor H. - 2022
probability distortion displayed by the agent and its degree determine whether an incentivecompatible contract can be implemented …, the strength of the incentives included in the optimal contract, and the location of incentives on the output space. Our … framework demonstrates that incorporating descriptively-valid theories of risk in a principal-agent setting leads to incentive …
Persistent link: https://www.econbiz.de/10013460007
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Lie detection : a strategic analysis of the Verifiability Approach
Ioannidis, Konstantinos; Offerman, Theo; Sloof, Randolph - 2020
additional obstruction penalty is imposed. We derive all the equilibria of the game and thereby the conditions under which the … valuable (strategic) information transmission, whereas a harsher obstruction penalty does not as soon as a lower limit is met. …
Persistent link: https://www.econbiz.de/10012226057
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Acquisitions as a real options bidding game
Smit, Han T. J.; Berg, Ward A. van den; De Maeseneire, … - 2005
This paper uses a unified treatment of real options and game theory to examine value appropriation in takeovers within a competitive environment of imperfect information. The integrated model considers a potential target as a shared real option on a bundle of resources. Competing potential...
Persistent link: https://www.econbiz.de/10011337396
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Constructing and using double-adjusted alphas to analyze mutual fund performance
Kole, Erik; Brink, Reza - 2019
We propose a new approach for estimating mutual fund performance that simultaneously controls for both factor exposure and firm characteristics. This double-adjusted alpha is motivated by the recent findings that traditional Fama-French style factor models do not fully adjust returns for the...
Persistent link: https://www.econbiz.de/10012024029
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Analytic decision rules for financial stochastic programs
Siegmann, Adriaan Hendrik; Lucas, André - 2000 - This version: May 1, 2000
Contemporary financial stochastic programs typically involve a trade-offbetween return and (downside)-risk. Using stochastic programming we characterize analytically (rather than numerically) the optimal decisions that follow from characteristic single-stage and multi-stage versions of such...
Persistent link: https://www.econbiz.de/10011303296