Rumors of a shortage may create higher-order uncertainty and cause panic buying even when there is no real shortage and most consumers are aware of this fact. We study the role of prices in alleviating, or even preventing, panic buying caused by such rumors. Under some circumstances, flexible...

We study the role of communication in repeated games with private monitoring. We first show that without communication, the set of Nash equilibrium payoffs in such games is a subset of the set of ε-coarse correlated equilibrium payoffs (ε-CCE) of the underlying one-shot game. The value of ε...

We study a model in which two perfectly informed experts offer advice to a decision maker whose actions affect the welfare of all. Experts are biased and thus may wish to pull the decision maker in different directions and to different degrees. When the decision maker consults only a single...

The authors study a multilateral bargaining procedure that extends A. Rubinstein's (1982) alternating offer game to the case of n players. The procedure captures the notion of consistency in the sense familiar in cooperative game theory and they use it to establish links to the axiomatic theory...

A seller with two objects faces a group of bidders who are subject to budget constraints. The objects have common values to all bidders but need not be identical, and may be either complements or substitutes. In a simple complete information setting we show: (1) if the objects are sold by means...

Organizational theory suggests that authority should lie in the hands of those with information, yet the power to transfer authority is rarely absolute in practice. We investigate the validity and application of this advice in a model of optimal contracting between an uninformed principal and...

We study a model in which voters choose between two candidates on the basis of both ideology and competence. While the ideology of the candidates is commonly known, voters are imperfectly informed about competence. Voter preferences, however, are such that ideology alone determines voting. When...