Experimental evidence and field data suggest that agents hold two seemingly unrelated biases: failure to account for the fact that the behavior of others reflects their private information (“winner's curse”), and a tendency to value a good more once it is owned (“endowment effect”). In...

The level of competence that voters attribute to different candidates is an important determinant of election results. In addition, it is observed that some candidates tend to be more ambiguous in their campaigns regarding future plans, while others commit to specific policies. We offer a model...

Credit rating agencies have an incentive to maintain a public reputation for credibility among investors but also have an incentive to develop a second, private reputation for leniency among issuers. We show that in markets with few issuers, such as markets for structured assets, these...