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This paper addresses a general problem with surveys asking agents for their assessment of the state of the economy: answers are highly dependent on information that is publicly available, while only information that is not already publicly known has the potential to improve a professional...
Persistent link: https://www.econbiz.de/10012232123
for wealth inequality and welfare. We employ a frictionless two-sectoral macroeconomic model with a housing sector to … investigate the dynamics of wealth inequality and the determinants of welfare. Households have non-homothetic preferences … inequality by about 0.7 percentage points (measured by top 10 percent share). Average welfare increases by about 0.5 percent …
Persistent link: https://www.econbiz.de/10012310716
Persistent link: https://www.econbiz.de/10012174537
customers' information might actually lead to welfare losses. Further, we highlight the supremacy of the assumption regarding …
Persistent link: https://www.econbiz.de/10012286246
I show how irrational ideas and rumors can drive asset prices - not because anyone believes them, but because they are commonly known without being common knowledge. The phenomenon is driven by short-term market participants who are well-informed about the information that others have, and who...
Persistent link: https://www.econbiz.de/10012304729
Why do people appear to forgo information by sorting into “echo chambers”? We construct a highly tractable multi-sender, multi-receiver cheap talk game in which players choose with whom to communicate. We show that segregation into small, homogeneous groups can improve everybody’s...
Persistent link: https://www.econbiz.de/10012265620
knowledge. We test this result in a laboratory experiment. The data cannot confirm the predicted welfare dominance of private …
Persistent link: https://www.econbiz.de/10012422494
I present a novel experimental design to measure lying and mistrust as continuous variables on an individual level. My experiment is a sender-receiver game framed as an investment game. It features two players: firstly, an advisor with complete information (i.e., the sender) who is incentivized...
Persistent link: https://www.econbiz.de/10012424302
We study a credence goods problem - that is, a moral hazard problem with non-contractible outcome - where altruistic experts (the agents) care both about their income and the utility of consumers (the principals). Experts' preferences over income and their consumers' utility are convex, such...
Persistent link: https://www.econbiz.de/10012431181
The present study contributes to the ongoing debate on possible costs and benefits of insider trading. We present a novel call auction model with insider information. Our model predicts that more insider information improves informational efficiency of prices, but this comes at the expense of...
Persistent link: https://www.econbiz.de/10012437539