We propose two characteristics of players' beliefs and study their role in shaping the set of rationalizable strategy profiles in games with incomplete information. The first characteristic, type-sensitivity, is related to how informative a player thinks his type is. The second characteristic,...

Sentiments are characteristics of players' beliefs. I propose two notions of sentiments, confidence and optimism, and I study their role in shaping the set of rationalizable strategy profiles in (incomplete information) games with complementarities. Confidence is related to a player's perceived...

We provide a set of new models of three different processes by which political parties nominate candidates for a general election: nominations by party leaders, nominations by a vote of party members, and nominations by a spending competition among potential candidates. We show that more extreme...

We study the design of mechanisms that implement Lindahl or Walrasian allocations and whose Nash equilibria are dynamically stable for a wide class of adaptive dynamics. We argue that supermodularity is not a desirable stability criterion in this mechanism design context, focusing instead on...

We study the impact of frictions on the prevalence of systemic crises. Agents privately learn about a fixed payoff parameter, and repeatedly adjust their investments while facing transaction costs in a dynamic global game. The model has a rich structure of externalities: payoffs may depend on...

We present a family of tractable dynamic global games and its applications. Agents privately learn about a fixed fundamental, and repeatedly adjust their investments while facing frictions. The game exhibits many externalities: payoffs may depend on the volume of investment, on its volatility,...