This paper derives necessary and sucient conditions for the existence of linear equilibria in the Rochet-Vila model of market making. In contrast to most previous work on the existence of linear equilibria in models of market making, we do not impose independence of the underlying random...

We examine a strategic-choice handicap model in which males send costly signals to advertise their quality to females. Females are concerned with the net viability of the male with whom they mate, where net viability is a function of the male's quality and signal. We identify circumstances in...

We consider Kyle's market order model of insider trading with multiple informed traders and show: if a linear equilibrium exists for two different numbers of informed traders, asset payoff and noise trading are independent and have finite second moments, then these random variables are normally...

This paper considers a class of repeated signalling games to gain some intuitive insights into the effects and the desirability of modelling players in a dynamic game of incomplete information as being obstinate in the sense that their beliefs satisfy a support restriction. We demonstrate that...

The paper analyzes the canonical hold-up model of Hart and Moore (1988) under the assumption that the courts can verify delivery of the good by the seller. We show that the first best can be achieved using simple "option contracts" which give the seller the right to decide whether or not trade...

We examine the evolutionary foundations of common equilibrium refinement ideas for extensive form games, such as backward and forward induction, by examining the limiting outcome of an evolutionary process driven by stochastic learning and (rare) mutations. We show that the limiting outcome in a...

This paper introduces a class of signalling games with response intersection to discuss the informational efficiency of a monopolistic financial market. For these games a necessary and sufficient condition for the existence of a fully revealing sequential equilibrium outcomes is derived....

The existence of a linear equilibrium in Kyle's model of market making with multiple, symmetrically informed strategic traders is implied for any number of strategic traders if the joint distribution of the underlying exogenous random variables is elliptical. The reverse implication has been...

Steady state equilibria in heterogeneous agent matching models with search frictions have been shown to exist in Shimer and Smith (2000) under the assumption of a quadratic search technology. We extend their analysis to the commonly investigated linear search technology.