A Fast Literature Search Engine based on top-quality journals, by Dr. Mingze Gao.
- Topic classification is ongoing.
- Please kindly let me know [mingze.gao@mq.edu.au] in case of any errors.
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Results 463 resources
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This paper suggests that the US recovery from the Great Depression was drivenby a shift in expectations. This shift was caused by President Franklin DelanoRoosevelt's policy actions. On the monetary policy side, Roosevelt abolishedthe gold standard and – even more importantly – announced the explicit objectiveof inflating the price level to pre-Depression levels. On the fiscal policyside, Roosevelt expanded real and deficit spending, which made his policyobjective credible. These actions violated prevailing policy dogmas and initiateda policy regime change as in Sargent (1983) and Temin and Wigmore(1990). The economic consequences of Roosevelt are evaluated in a dynamicstochastic general equilibrium model with nominal frictions. (JEL D84, E52,E62, N12, N42)
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Building on previous work by Schelling and Crawford, we study a model of bilateral bargaining in which negotiators can make binding commitments at a low positive cost c. Most of our results concern outcomes that survive iterated strict dominance. If commitment attempts never fail, there are three such outcomes. In two of them, all the surplus goes to one player. In the third, there is a high probability of conflict. If commitment attempts succeed with probability q < 1, the unique outcome that survives iterated strict dominance entails conflict with probability q2. When c = 0, analogous results hold if the requirement of iterated strict dominance is replaced by iterated weak dominance. (JEL C78, D84)
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I propose a new solution concept—behavioral equilibrium—to study environmentswith players who are naive, in the sense that they fail to account forthe informational content of other players' actions. I apply the framework tocertain adverse selection settings and show that, contrary to the existing literature,the adverse selection problem is exacerbated when naive players failto account for selection. More generally, the main distinguishing feature of theframework is that, in equilibrium, beliefs about both fundamentals and strategiesare jointly restricted. Consequently, whether a behavioral bias may ariseor not is determined endogenously in equilibrium. (JEL C70, D82, D83)
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We study the welfare economics of probabilistic patents that are licensed withouta full determination of validity. We examine the social value of insteaddetermining patent validity before licensing to downstream technology users, interms of deadweight loss (ex post) and innovation incentives (ex ante). We relatethe value of such pre-licensing review to the patent's strength, i.e., the probabilityit would hold up in court, and to the per-unit royalty at which it would belicensed. We then apply these results using a game-theoretic model of licensingto downstream oligopolists, in which we show that determining patent validityprior to licensing is socially beneficial. (JEL D82, K11, L24, O34 )
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Research in sociology and ethics suggests that individuals adhere to socialnorms of behavior established by their peers. Within an agency framework, wemodel endogenous social norms by assuming that each agent’s cost of implementingan action depends on the social norm for that action, defined to be theaverage level of that action chosen by the agent’s peer group. We show howendogenous social norms alter the effectiveness of monetary incentives, determinewhether it is optimal to group agents in a single or two separate organizations,and may give rise to a costly adverse selection problem when agents'sensitivities to social norms are unobservable. (JEL D23, D82, D86, Z13)
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We provide a pricing theory for emerging asset classes, like emerging markets,that are not yet mature enough to be attractive to the general public. Weshow how leverage cycles can cause contagion, flight to collateral, and issuancerationing in a frequently recurring phase we call the anxious economy.Our model provides an explanation for the volatile access of emerging economiesto international financial markets, and for three stylized facts we identifyin emerging markets and high yield data since the late 1990s. Our analyticalframework is a general equilibrium model with heterogeneous agents, incompletemarkets, and endogenous collateral, plus an extension encompassingadverse selection. (JEL D53, G12, G14, G15)
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We develop a political economy model where loss aversion and reference dependence are important in shaping people’s preferences over trade policy. The policy implications of the augmented model differ in three ways: there is a region of compensating protection, where a decline in the world price leads to an offsetting increase in protection, such that a constant domestic price is maintained; protection following a single negative price shock will be persistent; and irrespective of the extent of lobbying, there will be a deviation from free trade that favors loss-making industries. The augmented model explains protections of the US steel industry since 1980. (JEL F13, F14, L61)
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Recently, a number of authors have argued that the standard search model cannot generate the observed business-cycle-frequency fluctuations in unemployment and job vacancies, given shocks of a plausible magnitude. We propose a new calibration strategy of the standard model that uses data on the cost of vacancy creation and cyclicality of wages to identify the two key parameters –- the value of nonmarket activity and the bargaining weights. Our calibration implies that the model is consistent with the data. (JEL E24, E32, J31, J63, J64)
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When a job-seeker and an employer meet, find a prospective joint surplus, and bargain over the wage, conditions in the outside labor market, including especially unemployment, may have limited influence. The job-seeker's only credible threat during bargaining is to hold out for a better deal. The employer's threat is to delay bargaining. Consequently, the outcome of the bargain depends on the relative costs of delays to the parties, rather than on the payoffs that result from exiting negotiations. Modeling bargaining in this way makes wages less responsive to unemployment. A stochastic model of the labor market with credible bargaining and reasonable parameter values yields larger employment fluctuations than does the standard Mortensen-Pissarides model. (JEL J22, J23, J31, J64)
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We modify the Salop (1979) model of price competition with differentiatedproducts by assuming that consumers are loss averse relative to a referencepoint given by their recent expectations about the purchase. Consumers' sensitivityto losses in money increases the price responsiveness of demand—andhence the intensity of competition—at higher relative to lower market prices,reducing or eliminating price variation both within and between products.When firms face common stochastic costs, in any symmetric equilibrium themarkup is strictly decreasing in cost. Even when firms face different cost distributions,we identify conditions under which a focal-price equilibrium (wherefirms always charge the same "focal" price) exists, and conditions under whichany equilibrium is focal. (JEL D11 , D43, D81, L13)
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- Bond (14)
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- Director (8)
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- Capital Structure (6)
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- Journal Article (463)