In the game theory literature, Garrett Hardin's famous allegory of the tragedy of the commons has been modeled as a variant of the Prisoner's Dilemma, labeled the Herder Problem (or, sometimes, the Commons Dilemma). This brief paper argues that important differences in the institutional...

In this paper, I develop a novel approach to elicit heterogeneous investor beliefs about expected returns as well as common investor beliefs about the covariance matrix of the risky assets from a snapshot of cross-section portfolio holdings. Portfolio revealed expectations and the covariance...

One of the most complex problem in contemporary game theory is a solution of n-person games with cooperation between players. Sixty years of research bring us many different ideas in the form of vector of payoffs to all players: von Neumann - Morgenstern solution, core (Gillies), Shapley value,...

A host of recent studies show that attention allocation has important economic consequences. This paper reports the first empirical test of a cost-benefit model of the endogenous allocation of attention. The model assumes that economic agents have finite mental processing speeds and cannot...

Empirically determining whether wage differentials arise because of discrimination is extremely difficult, and distinguishing between different theories of discrimination is harder still. This paper exploits a number of unique features of a high-stakes television game show to determine which...

Prior research on quot;strategic votingquot; has reached the conclusion that unanimity rule is uniquely bad: it results in destruction of information, and hence makes voters worse off. We show that this conclusion depends critically on the assumption that the issue being voted on is exogenous,...

Feedback effects from asset prices to firm cash flows have been empirically documented. This finding raises a question for asset pricing: How are asset prices determined if price affects the fundamental value, which in turn affects the price? In this environment, by buying assets that others are...

Investment competition between local governments is a well-reported phenomenon accompanying the stage of economic take-off in China. Thus it is of important practical significance to investigate how the central bank can effectively realise its objectives in the context of such a competition when...

Recent research in strategy has called attention to the fact that particular positions in inter-firm networks may serve as a source of competitive advantage for the firms occupying them. This empirical literature has nonetheless found it difficult to separate the effects of positions from those...

Hedge Funds are often marketed as appealing alternative investment instruments. The quality of marketing arguments, used to seduce investors, are obviously function of the depth of market literacy of potential investors. In Italy, for instance, high returns, low volatility, and essentially no...