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Parameterizing 'Curiosity' as Measure of Innovation Potential of Individual Economic Agents

Obrimah, Oghenovo A. - 2020

This study parameterizes 'Curiosity' as measure of innovation potential of individual economic agents. In presence of discovery of two additional factors, which I term, PARQ and IDRA, that dominate `Curiosity' as measure of innovation potential, there is arrival at parameterization of three...

Persistent link: https://www.econbiz.de/10014096151

Market Power, Fully Revealing Prices and Welfare

Mueller-Frank, Manuel - 2012

This paper considers a dynamic duopoly market with strategic, price setting firms and an infinite set of fully rational, privately informed consumers who enter the market sequentially. I show that there exists a sequential equilibrium in which prices converge to their realized product qualities...

Persistent link: https://www.econbiz.de/10013099382

Economic Policy Uncertainty and Learning : Theory and Evidence on Mutual Funds

Jiang, Erica Xuewei; Starks, Laura T.; Sun, Sophia - 2021

Using the mutual fund industry as a laboratory, we demonstrate theoretically and empirically that economic policy uncertainty an affect investment decisions through an information rather than real options channel. Specifically, we find that fund flow-performance sensitivity decreases in...

Persistent link: https://www.econbiz.de/10013245400

Rational Bubbles and Middlemen

Awaya, Yu - 2019

This paper develops a ﬁnite-period model of rational bubbles where trade of an asset takes place through a chain of middlemen. We show that there exists a unique equilibrium, and a bubble can occur due to higher-order uncertainty. Under reasonable assumptions, the equilibrium price is...

Persistent link: https://www.econbiz.de/10012871468

Excessive Herding in the Laboratory : The Role of Intuitive Judgments

March, Christoph - 2018

We designed four observational learning experiments to identify the key channels that, along with Bayes-rational inferences, drive herd behavior. In Experiment 1, unobserved, whose actions remain private, learn from the public actions made in turn by subjects endowed with private signals of...

Persistent link: https://www.econbiz.de/10012924978

Beauty Contests Under Private Information and Diverse Beliefs : How Different?

Kurz, Mordecai - 2007

is used to test hypotheses of HB. We show the common knowledge assumptions of the PI theory are implausible. The theories … differ on four main analytical issues. (1) The pricing theory under PI implies prices have infinite memory and at each t … rationality conditions impose restrictions on any HB theory. We explain the tight restrictions on the model's parameters imposed …

Persistent link: https://www.econbiz.de/10012775716

Hysteresis in price efficiency and the economics of slow moving capital

Dow, James - 2020

Will arbitrage capital flow into markets experiencing shocks, mitigating adverse effects on price efficiency? Not necessarily. In a dynamic model with privately informed capital-constrained arbitrageurs, price efficiency plays a dual role, determining both the profitability of new arbitrage and...

Persistent link: https://www.econbiz.de/10012852271

On the Voluntary Disclosure of Redundant Information

Banerjee, Snehal; Breon-Drish, Bradyn M.; Kaniel, Ron; … - 2022

Why do firms engage in costly, voluntary disclosure of informationwhich is subsumed by a later announcement? We consider a model inwhich the firm's manager can choose to disclose short-term informationwhich becomes redundant later. When disclosure costs are sufficientlylow, the manager discloses...

Persistent link: https://www.econbiz.de/10013405002

Why do countries in financial distress strategically delay seeking help?

Tsoulouhas, Theofanis C. - In: Journal of government and economics : JGE 2 (2021), pp. 1-11

The paper differs from current literature by providing a systematic analysis of the relationship between sovereign debt, financial distress and political career concerns via a novel game-theoretic model, in order to analyze the strategic behavior of governments in revealing financial distress...

Persistent link: https://www.econbiz.de/10012803215

Aggregation of Information and Beliefs : Asset Pricing Lessons from Prediction Markets

Ottaviani, Marco; Sørensen, Peter Norman - 2009

In a binary prediction market in which risk-neutral traders have heterogeneous prior beliefs and are allowed to invest a limited amount of money, the static rational expectations equilibrium price is demonstrated to underreact to information. This effect is consistent with a favorite-longshot...

Persistent link: https://www.econbiz.de/10014205553