Attainment of rational expectations equilibria in asset markets calls for the price system to disseminate agents’ private information to others. Markets populated by human agents are known to be capable of converging to rational expectations equilibria. This paper reports comparable market...

At least since Akerlof (1970), asymmetric information in the case of experience goods has been a central issue in the economic literature. This paper studies regulation in markets where the quality of the experience good is never completely verifiable by consumers even after purchase. In the...

Destructive behavior has mostly been investigated by games in which all players have the option to simultaneously destroy (burn) their partners' money. In the destructor game, players are randomly paired and assigned the roles of destructor versus passive player. The destructor player chooses to...

We investigate the consequences of imperfect data privacy on information acquisition of personal health data. In a game of persuasion with ex-ante symmetric information players decide on whether or not to acquire and reveal information about their personal health status to convince a decision...

There exists extensive evidence that people learn positively about themselves. We build on this finding to develop a model of team formation in the workplace. We show that learning positively about oneself systematically undermines the formation of teams. Agents becoming overconfident tend to...

We develop a model of team formation in which workers learn about their level of ability. We show that insufficient cooperation may arise as workers learn positively about their own skills. We then build a model for team managers and establish that their objectivity in assessing coworkers'...

Using a large database built from the credit files of UniCredit we focus on loans to small businesses at the peak of the crisis. We study the determinants of the worsening of financial tension up to March 2009 for those customers experiencing (or close to) financial tension already at the end of...

This paper tests the robustness of the "two-tiered market" in which efficient bilateral contracts emerge between firms and workers (Brown, Falk and Fehr, 2004). Our experiment introduces stochastic interruptions in firms' ability to offer contracts. Involuntarily laid off workers are eager to be...

Dividend policy is one of controversial financial issues. There are various theories about dividend but in this study, the focus is on empirical test of signaling theory. This theory says that the payment of dividends provides information for investors and analysts. The aim of this study is...

In the presence of asymmetric information, the stage at which financing decisions are made about investment projects in a small open economy is crucial for the composition of international capital inflows as well as for the efficiency of channeling savings into investment. This paper compares...