We investigate conditions under which a government facing a large set of small private agents can implement its desired outcome when it has only a limited commitment ability to policy actions. We show that, in static contexts, more commitment ability always improves equilibrium outcomes and, in...

This paper provides a theory of endogenous implicit guarantees and how this leads to the existence of systemic assets, i.e. assets that are too important to default. In the presence of imperfectly observable private liquidity needs, direct transfers to agents are imperfect so that, when more...