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Dynamic Supplier Contracts under Asymmetric Inventory Information

Zhang, Hao; Nagarajan, Mahesh; Sosic, Greys - 2010

In this paper, we examine a supply chain in which a single supplier sells to a downstream newsvendor-type retailer. We make two assumptions that enrich this simple and well-understood model. First, we consider a multi-period model, in which the sequence of events is as follows. In a period, t,...

Persistent link: https://www.econbiz.de/10014047671

Adverse Selection in Competitive Search Equilibrium

Guerrieri, Veronica; Shimer, Robert; Wright, Randall D. - 2021

We extend the concept of competitive search equilibrium to environments with private information, and in particular adverse selection. Principals (e.g. employers or agents who want to buy assets) post contracts, which we model as revelation mechanisms. Agents (e.g. workers, or asset holders)...

Persistent link: https://www.econbiz.de/10013235346

Competition and the Ratchet Effect

Charness, Gary - 2010

In labor markets, the ratchet effect refers to a situation where workers subject to performance pay choose to restrict their output, because they rationally anticipate that firms will respond to higher output levels by raising output requirements or cutting pay. We model this effect as a...

Persistent link: https://www.econbiz.de/10013138400

Persistent Private Information

Williams, Noah - 2008

This paper studies the design of optimal contracts in dynamic environments where agents have private information that is persistent. In particular, I focus on a continuous time version of a benchmark insurance problem where a risk averse agent would like to borrow from a risk neutral lender to...

Persistent link: https://www.econbiz.de/10012772314

Channeling Domestic Savings into Productive Investment Under Asymmetric Information : The Essential Role of Foreign Direct Investment

Razin, Asaf - 2014

Foreign direct investment (FDI) is observed to be a predominant form of capital flows to low and middle income countries with insufficiently developed capital markets. This paper analyzes the problem of channeling domestic savings into productive investment in the presence of asymmetric...

Persistent link: https://www.econbiz.de/10012752887

Social Insurance, Information Revelation, and Lack of Commitment

Golosov, Mikhail - 2014

We study the optimal provision of insurance against unobservable idiosyncratic shocks in a setting in which a benevolent government cannot commit. A continuum of agents and the government play an infinitely repeated game. Actions of the government are constrained only by the threat of reverting...

Persistent link: https://www.econbiz.de/10013044626

The Power of Asking : How Communication Affects Selfishness, Empathy, and Altruism

Andreoni, James - 2010

communication between subjects. In reality, however, altruism usually requires interaction between givers and receivers, which … altruism are built on human sociality. We experimentally examine communication in which one subject allocates $10 between … recipients had been able to ask, even when they were silent. We conclude that communication dramatically influences altruistic …

Persistent link: https://www.econbiz.de/10013138083

Bayesian Persuasion

Kamenica, Emir - 2009

When is it possible for one person to persuade another to change her action? We take a mechanism design approach to this question. Taking preferences and initial beliefs as given, we introduce the notion of a persuasion mechanism: a game between Sender and Receiver defined by an information...

Persistent link: https://www.econbiz.de/10013153918

Information Acquisition in Rumor Based Bank Runs

He, Zhiguo - 2012

We study information acquisition and dynamic withdrawal decisions when a spreading rumor exposes a solvent bank to a run. Uncertainty about the bank's liquidity and potential failure motivates depositors who hear the rumor to acquire additional noisy signals. Depositors with less informative...

Persistent link: https://www.econbiz.de/10013098473

Information Dynamics and Equilibrium Multiplicity in Global Games of Regime Change

Angeletos, Marios; Hellwig, Christian; Pavan, Alessandro - 2021

Global games of regime change -- that is, coordination games of incomplete information in which a status quo is abandoned once a sufficiently large fraction of agents attacks it -- have been used to study crises phenomena such as currency attacks, bank runs, debt crises, and political change. We...

Persistent link: https://www.econbiz.de/10013216888