The question in which we are interested is how a market inhabited by multiple agents, about whom we are differentially uncertain, and who trade goods the use of which imposes a negative effect on others, is to be ideally regulated. We show that a priori asymmetric uncertainty, when combined with...

We study optimal monetary policy in an environment in which firms' pricing and production decisions are subject to informational frictions. Our framework accommodates multiple formalizations of these frictions, including dispersed private information, sticky information, and certain forms of...

This paper explains why crises follow periods of sustained banking profitability in an environment in which there is uncertainty about whether outcomes depend on the risk management skills of banks, or are just based on luck, in the spirit of Piketty's Model (1995) of “left-wing” and...

The study examines the predictability of 48 sovereign bond markets based on a strategy of 27,000 technical trading rules. These rules represent four popular trading rule classes, they are: moving average, filtering, support and resistance, and channel breakout rules, with numerous variants in...

Wealthier economies experience less frequent but more severe financial crises. To investigate this puzzle, we propose a model of collateralized lending in which: (1) borrowers endogenously determine collateral quality, and (2) lenders can produce costly information about collateral. In...

The COVID-19 pandemic has inflicted an economic hardship unprecedented for the modern age. In this paper, we show that the health crisis and ensuing Great Lockdown, came with an unseen level of economic uncertainty. First, using a European dataset on country-level and regional internet searches,...

Die Liberalisierung der globalen Finanzmärkte hat ihr Ziel verfehlt, für mehr Stabilität und Wirtschaftswachstum zu sorgen. Stattdessen folgt seit 30 Jahren eine Krise auf die andere. Jetzt werden etliche Bankenreformen diskutiert, um die Finanzmärkte krisensicherer zu machen. Dabei...

This article demonstrates that wealthy and advanced nations have the capacity to absorb additional resources to the nontradable sectors. This absorption capacity provides them with an advantage in resource allocation, which consequently transforms to welfare gains in trade. The author builds a...