We apply the cognitive hierarchy model of Camerer et al. (Q J Econ 119(3):861–898, <CitationRef CitationID="CR1">2004</CitationRef>)—where players have different levels of reasoning—to Huck et al. (Games Econ Behav 38:240–264, <CitationRef CitationID="CR12">2002</CitationRef>) discrete version of Hamilton and Slutsky (Games Econ Behav 2:29–46, <CitationRef CitationID="CR19">1990</CitationRef>) action commitment...</citationref></citationref></citationref>

type="main" <title type="main">ABSTRACT</title> <p>Using plant-level data for Brazilian manufacturing firms, this paper provides evidence that government control over banks leads to significant political influence over the real decisions of firms. I find that firms eligible for government bank lending expand employment in...</p>