Many important economic and political decisions are made by teams. In the economic literature, however, the decision units are frequently modeled as individual economic agents. The paper experimentally investigates the question to what extent observed team decisions under risk are actually...

This paper deals with a privatized firm facing potential market entry. The firm has inherited excess capacity from its public past. The players have asymmetric costs. Only the entrant must install new capacity, which incurs positive capacity installation costs. The paper considers the subgame...

The relationship between risk and asset price fluctuations is studied in a stochastic overlapping generations asset pricing model with i.i.d. production shocks. The non-separability of preferences is an important factor in explaining the time paths of asset prices and returns. We show that the...

In this paper we characterize the set of Pareto optimal asset equilibria in a stochastic OLG-framework when real monetary shocks impinge on the economy. We show that it is the strength rather than the mere presence of monetary disturbances that accounts for, if the market mechanism fails to...