We present a dynamic contracting model in which the principal and agent disagree about the resolution of uncertainty, and we illustrate the contract design in an application with Bayesian learning. The disagreement creates gains from trade that the principal realizes by transferring payment to...

We study panel data on three birth-year cohorts to understand the changes in risk tolerance across different age groups. Interval regression models on cross-sectional data for each birth cohort are constructed to investigate how time-invariant factors and macroeconomic events such as September...

The most important financial source for behavioral economics is the Russell Sage Foundation (RSF). The most prominent behavioral economists among the RSF's twenty-six member Behavioral Economics Roundtable (BER) are Kahneman, Tversky, Thaler, Camerer, Loewenstein, Rabin, and Laibson. The...

The relationship between banks' capitalizations and risk-taking behaviors has been one of the central issues in the banking literature because of its implications on regulatory policies. Despite the fact that a considerable amount of studies have been conducted concerning the issue, neither...

The problem of assessing a system of governance for composite services in the social economy is approached by means of original methods. The main innovation is that the welfare structure of a society is separated from the legal transaction - or institutional structure. As both the various types...

We investigate the relationship between banks' capitalization and risk-taking behavior. The conventional wisdom is that well-capitalized banks are less inclined to increase asset risk, because the option value of deposit insurance decreases with capitalization. There are, however, at least three...

This paper provides a theoretical framework to investigate the relationship between banks' capitalization and risk-taking behavior. The conventional wisdom is that relatively well-capitalized banks are less inclined to increase asset risk, because the option value of deposit insurance decreases...

We propose a model that explains the choice behavior of small and medium sized enterprises (SMEs) with respect to price risk management instruments, one of them being futures contracts. We relate the key components of the model to characteristics of SMEs, in this way explaining differences...

Extant literature finds large differences in loan denials between small firms owned by whites and other demographic groups. However, none of this literature focuses on the business owner's personal wealth, despite it being a potentially important part of the small business lending decision. We...

There is a growing analytical body of research on artificial smoothing - the manipulation of accounting numbers through accounting cosmetics. However, firms also can manipulate earnings through production-investment decisions real smoothing; the latter topic received little attention. In this...