The recent financial crisis has witnessed the importance of the housing markets in macroeconomic fluctuations. We investigate the correlation between housing dynamics and the business cycle for a variety of countries. Our empirical results confirm the two daunting facts faced by lots of...

I derive the price function of securities that can be pledged as collateral, in an economy where rational investors are privately informed. Although the payoffs of borrowers and lenders have truncated distributions, the linear equilibrium is unique and has an analytic solution. Such result...

The weight assigned to public information in Keynesian beauty contest depends on the signal precision and on the degree of strategic complementarities. This experimental study shows that the response of subjects to changes in the signal precision and in the degree of strategic complementarities...