The art of rhetoric may be defined as changing other people’s minds (opinions, beliefs) without providing them new information. One technique heavily used by rhetoric employs analogies. Using analogies, one may draw the listener’s attention to similarities between cases and to re-organize...

The regulation of big banks has been in the spotlight for many reasons. Examining evidence for more than 80 countries for the years 1995-2009, banking systems are shown to be highly concentrated. In many cases, the banks are so big that bank-specific credit-growth fluctuations affect the...

We present a game-theoretic model of political discourse that explores how strategic incentives to make potentially persuasive arguments vary across different informational contexts. We show that political sophistication of the listeners fundamentally affects the speakers' incentives to make...

In standard global games, individual behavior is optimal if it constitutes a best response to agnostic - Laplacian - beliefs about the aggregate behavior of other agents. This paper considers a standard binary action global game augmented with noisy signaling by an informed policy-maker and...

The paper attempts an explanation of the alleged "lack of adequate economic models" to predict and eventually avoid - using certain policy recommendations - the recurrent financial and fiscal crises, and finally, economic crisis, recurrently registered in the world. From author opinion, in the...

It is shown that rent-seeking contests with continuous and independent type distributions possess a unique pure-strategy Nash equilibrium.

This paper addresses a key question on the design of electoral systems. Should all voters vote on the same day or should elections be staggered, with late voters observing early returns before making their decisions? Using a model of voting and social learning, we illustrate that sequential...

This paper utilizes a sender-receiver game involving a government and infinite heterogeneous agents to analyze the characteristics of information transmission in an environment where a true state does not exist and coordination among various players is required. It shows that a message conveyed...

This chapter reviews recent experimental data testing game theory and behavioral models that have been inspired to explain those data. The models fall into four groups: in cognitive hierarchy or level-k models, the assumption of equilibrium is relaxed by assuming agents have beliefs about other...

Trendsetters wish to be perceived as the type that defines normative behavior. Incorporating norm formation in Bernheim (1994)’s model yields equilibria with social considerations concentrating behavior, allowing multiple conformist pools. Refinements link each pooling equilibrium to a unique...