Showing 71 - 80 of 182
We study the interaction between a potential offender's (principal ) incentive to commit crimes and the potential victims' (agents) incentive to report crime. The probability of crime and the credibility of reports are endogenously determined in equilibrium, and the principal is convicted if...
Persistent link: https://www.econbiz.de/10012155639
We consider collective decisions made by agents whose preferences and power depend on past events and decisions. Faced with an ineffcient equilibrium and an opportunity to commit to a policy, can the agents reach an agreement on such a policy? Under an intuitive condition linking power...
Persistent link: https://www.econbiz.de/10011481650
How do successive, forward-looking agents experiment with interdependent and endogenous technologies? In this paper, trying a radically new technology not only is informative of the value of similar technologies, but also reduces the cost of experimenting with them, in effect expanding the space...
Persistent link: https://www.econbiz.de/10011481651
What does contract negotiation look like when some parties hold private information and negotiation frictions are negligible? This paper analyzes the above question and provides a foundation for renegotiation-proof contracts in a related environment. The model extends the framework of the Coase...
Persistent link: https://www.econbiz.de/10011481652
Given two sets of random variables, how can one determine whether the former variables are more interdependent than the latter? This question is of major importance to economists, for example, in comparing how various policies affect systemic risk or income inequality. Moreover, correlation is...
Persistent link: https://www.econbiz.de/10011481655
Persistent link: https://www.econbiz.de/10011545317
Orderings of interdependence among random variables are useful in many economic contexts, for example, in assessing ex post inequality under uncertainty; in comparing multidimensional inequality; in valuing portfolios of assets or insurance policies; and in assessing systemic risk. We explore...
Persistent link: https://www.econbiz.de/10010282879
How does renegotiation affect contracts between a principal and an agent subject to persistent private information and moral hazard? This paper introduces a concept of renegotiationproofness, which adapts to stochastic games the concepts of weak renegotiation-proofness and internal consistency...
Persistent link: https://www.econbiz.de/10010282880
We present a model for the equilibrium movement of capital between asset markets that are distinguished only by the levels of capital invested in each. Investment in that market with the greatest amount of capital earns the lowest risk premium. Intermediaries optimally trade off the costs of...
Persistent link: https://www.econbiz.de/10010282898
We analyze social learning and innovation in an overlapping generations model in which available technologies have correlated payoffs. Each generation experiments within a set of policies whose payoffs are initially unknown and drawn from the path of a Brownian motion with drift. Marginal...
Persistent link: https://www.econbiz.de/10010282918