We analyse the effect of the uncertainty about the fundamentals on the probability of sudden stops of capital flows from a theoretical and empirical perspective. Our model predicts that the probability of crises increases with the uncertainty, ie. the dispersion of private signals about the true...

Green (1984) demonstrates in a one-period setting that convertible debt can eliminate the asset substitution problem. However, in a multi-period setting the terms of the convertible issue will in general be set before the specific asset substitution opportunity presents itself. This leaves room...

We develop a theoretical analysis of the choice of firms between fixed-price offerings and uniform-price auctions for selling shares in IPOs and privatizations. We consider a setting in which a firm goes public by selling a fraction of its equity in an IPO market where insiders have private...

The deterring role of the medium of payment in a takeover contest is analyzed from the point of view of the bidder. Cash, debt and equity are considered as alternative mediums of payment, and the bidder equilibrium strategies are specified following the Perfect Bayesian Equilibrium requirements...

Over the last few decades, most central banks, concerned about settlement risks inherent in payment netting systems, have implemented real-time gross settlement (RTGS) systems. Although RTGS systems can significantly reduce settlement risk, they require greater liquidity to smooth...

This paper uses a modified dictator game to investigate the relationship between response times and social preferences. We find that egoistic subjects make faster decisions than subjects with social preferences. Moreover, our within-analysis reveals that, for a given individual, egoistic payoff...

In the first part of this paper, we elicit time preferences by using the experimental and econometric methods of Benhabib-Bisin-Schotter (2006). We follow the matching task procedure on money-time pairs with real rewards. Among the model specifications we use, the one with exponential...

Recently a great deal of controversy has been generated from the salaries earned by head football coaches in the NCAA. On one level this seems odd since many figures in the world of sports and entertainment earn exceptionally high salaries. However, one important difference in the case of NCAA...

A motivation for central bank independence (CBI) is that policy delegation helps politicians manage diverse coalitions. This paper develops a model of coalition formation that predicts when delegation will occur. An analysis of policy preferences survey data and CBI indicators supports the...

We study experimentally the nature of dominance violations in three minimalist dominance solvable guessing games. We examine how subjects' reported reasoning processes translate into their stated choices and beliefs about others' choices, and how both reasoning processes and choices relate to...