There is an extensive literature claiming that it is often difficult to make use of arbitrage opportunities in financial markets. This paper provides a new reason why existing arbitrage opportunities might not be seized. We consider a world with short-lived securities, no short-selling...

When the asset market is incomplete, competitive equilibria are constrained suboptimal, which provides a scope for pareto improving interventions. Price regulation can be such a pareto improving policy, even when the welfare effects of rationing are taken into account. An appealing aspect of...

We consider a class of perfect information bargaining games with unanimity acceptance rule. The proposer and the order of responding players are determined by the state that evolves stochastically over time. The probability distribution of the state in the next period is determined jointly by...

We consider a non-cooperative multilateral bargaining game and study an action-dependent bargaining protocol, that is, the probability with which a player becomes the proposer in a round of bargaining depends on the identity of the player who previously rejected. An important example is the...

We study a model of non-cooperative multilateral unanimity bargaining on a full-dimensional payoff set. The probability distribution with which the proposing player is selected in each bargaining round follows an irreducible Markov process. If a proposal is rejected, negotiations break down with...

We consider a non–cooperative multilateral bargaining game and study an action–dependent bargaining protocol, that is, the probability with which a player becomes the proposer in a round of bargaining depends on the identity of the player who previously rejected. An important example is the...

Suppose that a firm has several owners and that the future is uncertain in the sense that one out of many different states of nature will realize tomorrow. An owner’s time preference and risk attitude will determine the importance he places on payoffs in the different states. It is a...