The paper generalizes the Kiyotaki-Wright trade model by treating the trading period as a finite game, so Nash's theorem can be used to prove the existence of equilibrium, and by treating the economy as a Markov process, so an ergodic theorem can be used to show the existence of equilibria with...

Where genetically unrelated members of a group benefit from mutual adherence to a social norm, agents may obey the norm and punish its violators, even when this behavior cannot be justified in terms of self-regarding, outcome-oriented preferences. We call this strong reciprocity. We distinguish...

Monitoring by peers in work teams, credit associations, partner- ships, local commons situations, and residential neighborhoods is often an effective means of attenuating incentive problems. Most explanations of the incentives to engage in mutual monitoring rely either on small group size or on...