The focus of this paper is on the interaction between a bail-out loan decision of a bank to a sovereign borrower and the adequacy of the bank's capital. The new loan is granted on two conditions: First, it must improve the likelihood of repayment of the outstanding loan; second the bank should...

According to Condorcet, the larger the team of decision-makers using the simple majority rule, the more likely they are to reach correct decisions. This paper examines the validity of this claim under the condition of reduced team competence with size. Determining committee size always involves...

This paper shows that the questions: “Who consults investment analysts?” and “Who goes to the “El Farol” bar in Santa Fe?” are similar. Thus, investors use a mixed optimal strategy. The demand for consulting services is also characterized. Copyright Springer-Verlag Berlin/Heidelberg 2003