During the COVID-19 pandemic, some goods suddenly became scarce due to panic purchases and stockpiling. The decision to hoard is influenced by higher-order beliefs. If an agent believes that other agents think that a good will become scarce, she concludes that these other agents will hoard, and...

Money markets have two functions, the allocation of liquidity and the processing of information. We develop a model that allows us to evaluate the efficiency of different money market derivatives regarding these two objectives. We assume that due to its size, a large bank receives a more precise...

The long-run evolution of per-capita income exhibits a structural break often associated with the Industrial Revolution. We follow Mokyr (2002) and embed the idea that this structural break reflects a regime switch in the evolution of technological knowledge into a dynamic framework, using Airy...

Should the European Union grant state aid through an institution like the European Investment bank? This paper evaluates the efficiency of different measures for granting state aid. We use a theoretical model with firms that differ in their creditworthiness and compare different types of...