A large body of empirical literature has shown that market impact of financial prices is transient. However, from a theoretical standpoint, the origin of this temporary nature is still unclear. We show that an implied transient impact arises from the Nash equilibrium between a directional trader...

Each bargaining problem generally involves two stages. A bargaining solution needs to decide what actions to take and how to share values. This note extends the Nash bargaining solution to such two-stage bargaining problems

We provide conditions that simplify applying Reny's (1999) better-reply security to Bayesian games, and use these conditions to prove the existence of equilibria for classes of games in which payoff discontinuities arise only at "ties." These games include a general version of all-pay contests,...

We define social institutions as strategies in some repeated game. With this interpretation in mind, we consider the impact of introducing requirements on strategies which have been viewed as necessary properties for any social institution to endure. The properties we study are finite...

This paper introduces certainty equivalents as an alternative to the expected utility framework that is often used in the bargaining literature. If agents bargain over their certainty equivalents, a higher risk aversion does not necessarily weaken their bargaining position – for the same...

The fundamental connection between stochastic differential equations (SDEs) and partial differential equations (PDEs) has found numerous applications in diverse fields. We explore a similar link between stochastic calculus and combinatorial PDEs on graphs with Hodge structure, by showing that...

We conduct a series of Cournot duopoly market experiments with a high number of repetitions and fixed matching. Our treatments include markets with (a) complete cost symmetry and complete information, (b) slight cost asymmetry and complete information, and (c) varying cost asymmetries and...

This study extends the finite city assumption of pure Hotelling model with two firms to infinity length and uses a family of bimodal distributions to represent the heterogeneous preferences of customers to the firms. In the setting of bimodal distributions, the distance between the modes and the...

A multi-network, or multi-layer network, is a set of nodes that can be connected via multiple types of links. In this paper, I first define a notion of pairwise stability for multi-networks that is analogous to pairwise stability of a single network. When the utility of each agent derived from...