The literature on the computation of Nash equilibria in n-person games is dominated by simplicial methods. This paper is the first to introduce a globally convergent algorithm that fully exploits the differentiability present in the problem. It presents an everywhere differentiable homotopy to...

A probabilistic belief revision function assigns to every initial probabilistic belief and every observable event some revised probabilistic belief that only attaches positive probability to states in this event. We propose three axioms for belief revision functions: (1) linearity, meaning that...

Both in game theory and in general equilibrium theory there exists a number of universally stable adjustment processes. In game theory these processes typically serve the role of selecting a Nash equilibrium. Examples are the tracing procedure of Harsanyi and Selten or the equilibrium selection...

Social environments constitute a framework in which it is possible to study how groups of agents interact in a society. The framework is general enough to analyse both non-cooperative and cooperative games. We identify a number of shortcomings of existing solution concepts that are used for...

This paper provides empirical evidence on the existence of implicit taxes in the corporate sector. With this finding, it provides support for the offsetting nature of explicit versus implicit taxes. Governments continuously provide tax preferences (tax incentives) to firms to induce these firms...

Social-psychological research reveals two opposite ways in which a person can respond to increased feelings of uncertainty in decision-making. First, he (or she) may try to reduce his uncertainty by searching for more specific information. This leads to less stereotyping and discrimination....

In this paper we show that the claim that the price in a Stackelberg model is lower than the price in a Cournot model, does not necessarily hold in an entry-deterrence framework. Using a signaling model of entry deterrence, we show that when post-entry competition is Stackelberg instead of...

The general equilibrium model with incomplete asset markets provides a unified framework for many problems in finance and macroeconomics. In its simplest version with only two time periods and a single physical commodity the model is ideally suited for the study of problems in cross sectional...

We consider general two-sided matching markets, so-called matching with contracts markets as introduced by Hatfield and Milgrom (2005), and analyze (Maskin) monotonic and Nash implementable solutions. We show that for matching with contracts markets the stable correspondence is monotonic and...

In its landmark ruling in Illinois Brick Co. v. Illinois, the U.S. Supreme Court restricted the right to sue for private damages from violations of section 4 of the Clayton Act to direct purchasers. Despite the fact that typically antitrust injury is, at least in part, passed on to firms lower...