Conventions can be narrowly interpreted as coordinated ways of equilibrium play, i.e., a specific convention tells all players in a game with multiple strict equilibria which equilibrium to play. In our view, coordination often takes place before learning about the games. Thus, one has to...

We experimentally test overconfidence in investment decisions by offering participants the possibility to substitute their own for alternative investment choices. Overall, 149 subjects participated in two experiments, one with just one risky asset, the other with two risky assets. Overconfidence...

This paper analyzes vertical cross-shareholding, that is, the mutual holding of a minority of shares between vertically related firms. First, we explore the issue in a game-theoretic model and show that cross-shareholding is sufficient to obtain efficient outcomes. We then test the model's...