We investigate situations in which agents can communicate to each other only through a chain of intermediators, for example because they have to obey institutionalized communication protocols. We assume that all involved in the communication are strategic, and might want to influence the action...

Diversification through a financial intermediary has the benefit of transforming loans that need costly monitoring into bank deposits that do not. We show, however, that financial intermediation in a costly state verification model has a cost not yet analyzed: it allows for the existence of...

We investigate situations in which agents can communicate to each other only through a chain of intermediators, for example, because they have to obey institutionalized communication protocols. We assume that all involved in the communication are strategic and might want to influence the action...