We present a model in which a government's current capital controls policy signals future policies. Controls on capital outflows evolve in response to news on technology, conditional on government attitudes towards taxation of capital. When there is uncertainty over government types, a policy of...

We develop a signaling model of final offer arbitration (FOA) in which the informed party makes the final settlement demand to the uninformed party. In FOA, each party submits a proposal to an arbitrator and if no agreement is reached, the arbitrator must select one of the two submitted...

Forensic interviewers are routinely advised to instruct children that they should indicate when they do not understand a question. This study examined whether administering the instruction with a practice question may help interviewers identify the means by which individual children signal...

Biotechnology companies rely heavily on alliances with pharmaceutical companies to finance their research and development expenditures, and pharmaceutical firms rely heavily on alliances to supplement their internal research and development. Previous studies suggest that asymmetric information...

A policymaker relies on regulators or bureaucrats to screen agents on her behalf. How can she maintain some control over the design of the screening process? She solves a two-layer mechanism design problem: she restricts the set of allowable allocations, after which a screener picks a menu that...

Empirical experience and theory both suggest that policy reforms can be aborted or reversed if they lack sufficient credibility, One reason for such credibility problems is the legitimate doubt regarding how serious the government really is about :he reform process. This paper considers a...

The standard model of signaling used in open economy macroeconomics concentrates on building a reputation when a policymaker's `type' is unknown. Observing tough policy leads market participants to raise the probability that a policymaker is tough, and therefore to expect tough policy in the...

We estimate a multivariate early-warning model to assess the usefulness of private credit and other macro-financial variables in predicting banking sector vulnerabilities. Using data for 23 European countries, we find that global variables and in particular global credit growth are strong...

In a world of increasingly extensive information, rational investors can make better decisions. However, reinforcement-oriented investors are also more likely to observe preferred signals close to their own perception. A focus on these signals distorts the perceived aggregate signal in the...

Patents and crowdfunding both attempt to foster early stage innova-tions. In theory, patents signal quality and value to attract investment and buyers and ultimately facilitate commercialization. Crowdfunding allows multiple individuals to make small contributions to finance start-up ven-tures....