This paper extends the convergence result in Kalai and Lehrer (1993a, 1993b) to a class of games where players have a payoff function continuous for the product topology. Provided that 1) every player maximizes her expected payoff against her own beliefs, 2) every player updates her beliefs in a...

This paper aims to show that the market selection hypothesis in finance is not solely driven by the competitiveness of such markets, as was originally claimed by Alchian [1] and Friedman [4]. Within a standard intertemporal General Equilibrium framework, we allow for an agent to have enough...

We simulate the performances of a standard derivatives portfolio to evaluate the relevance of benchmarking in terms of downside risk reduction. The simulation shows that benchmarking always leads to significantly more severe losses in average than those generated by letting the portfolio reach...

Abstract We argue that reluctance to invest in drug treatments to fight the AIDS epidemics in developing countries is largely motivated by severe losses occurring from the future albeit uncertain appearance of a curative vaccine. We design a set of securities generating full insurance coverage...

We argue that an increase in investments in R&D for innovative treatments to eradicate neglected diseases in developing countries leads to a rational decrease in investments in available treatment technologies. In a formal model where the government of a developing country seeks to optimally...

We consider a regulator providing deposit insurance to a bank with private information about its investment portfolio. As typical in practice, we assume that the regulator does not commit to auditing after any risk report from the bank. We first show that the optimal contract can be implemented...

Typical of the AIDS epidemics is that governments in developing countries under-invest in drugs production because of the possible appearance of a curative vaccine. We design a financial tool allowing to hedge against this event. We show that the introduction of this asset increases social...

This paper investigates simultaneous learning about both nature and others' actions in repeated games, and identifies a set of sufficient conditions assuring that equilibrium actions converge to a Nash equilibrium. Players have each an utility function over infinite histories continuous for the...