We develop a general equilibrium model of trade between identical countries. The model is similar to a 2x2x2 Heckser-Ohlin model, but the factors of production, skilled and unskilled labor, are endogenously determined from human capital investments by the workers. Firms are only able to observe...

We provide a general characterization of the structure of rational expectations equilibria of any degree of revelation for pure exchange, sequential economies, with deffinitely many states of private information, an incomplete financial market and nominal assets. We estimate the dimension of the...

This paper considers the role of foreign investors in developed-country equity markets. It presents a quantitative model of trading that is built around two new assumptions: (i) both the foreign and domestic investor populations contain investors of different sophistication, and (ii) investor...