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A model of quality uncertainty with a continuum of quality levels

Gertz, Christopher - 2014 - This version: September 3, 2014

This work takes a closer look on the predominant assumption in usual lemon market models of having finitely many or even only two different levels of quality. We model a situation which is close to the classical monopolistic setting but admits an interval of possible quality values....

Persistent link: https://www.econbiz.de/10010403068

Tournaments with gaps

Imhof, Lorens; Kräkel, Matthias - 2013

A standard tournament contract specifies only tournament prizes. If agents' performance is measured on a cardinal scale …, the principal can complement the tournament contract by a gap which defines the minimum distance by which the best … performing agent must beat the second best to receive the winner prize. We analyze a tournament with two risk averse agents …

Persistent link: https://www.econbiz.de/10010198511

Using Strategic Uncertainty to Persuade Multiple Agents

Hoshino, Tetsuya - 2017

A principal wishes to persuade multiple agents to take a particular action profile. Each agent cares about both a payoff-relevant state and others' actions. The principal discloses information about the state to control the agents' behavior by using their strategic uncertainty. We show that she...

Persistent link: https://www.econbiz.de/10012955142

Informationsaustausch und trotzdem Wettbewerb? Unternehmensverhalten bei Nachfrageunsicherheit

Hornig, Stephan O. - 1999

Unternehmen müssen nicht immer Kollusionsabsichten verfolgen, wenn sie untereinander Informationen austauschen. Dieser Beitrag zeigt, daß bei Nachfrageunsicherheit auch strikt kompetitive Konkurrenten private Informationen bezüglich ihrer Nachfragebedingungen preisgeben. Dies läßt sich in...

Persistent link: https://www.econbiz.de/10010305090

Investment under Uncertainty and Correlated Privately Known Costs

Dehghani, Mohammad Hossein - 2019

This paper studies the behavior of two firms after a new investment opportunity arises. Examples of such an investment are technology adoption or market entry. Firms either invest immediately or wait until market uncertainty is resolved. Two types of separating equilibrium are possible when...

Persistent link: https://www.econbiz.de/10012905574

Reducing Buyers’ Uncertainty About Taste-Related Product Attributes

Markopoulos, Panos - 2014

It is becoming increasingly important for firms to know when to take steps to reduce buyers' uncertainty about their products and services. This article focuses on investments that firms can make to reduce buyers' uncertainty about taste-related product attributes. Using an analytical model, we...

Persistent link: https://www.econbiz.de/10013050384

Uncertainty about the fundamentals and the occurrence of sudden stops of capital flows : theory and empirics

Köhler-Geib, Fritzi - 2006

We analyse the effect of the uncertainty about the fundamentals on the probability of sudden stops of capital flows from a theoretical and empirical perspective. Our model predicts that the probability of crises increases with the uncertainty, ie. the dispersion of private signals about the true...

Persistent link: https://www.econbiz.de/10009746213

Quality uncertainty with imperfect information acquisition

Gertz, Christopher - 2013 - This version: September 17, 2013

I analyze a monopolistic model of quality uncertainty but with the possibility of information acquisition on the consumer side. Information is costly and its amount is chosen by the consumer. The analysis of Bayesian equilibria shows the possibility of three equilibrium classes, only one of...

Persistent link: https://www.econbiz.de/10009793534

Crises and rating agencies : on the effect of aggregate uncertainty on rating agencies' incentives to distort ratings

Loerke, Petra; Niedermayer, Andreas - 2015

We analyze a rating agency's incentives to distort ratings in a model with a monopolistic profit maximizing rating agency, a continuum of heterogeneous firms, and a competitive market of risk-neutral investors. Firms sell bonds, the value of a firm's bond is known to the firm and observable by...

Persistent link: https://www.econbiz.de/10011345759

Diagnostic uncertainty and insurance coverage in credence goods markets

Balafoutas, Loukas; Fornwagner, Helena; Kerschbamer, Rudolf - 2020 - This version: 5 November 2020

Credence goods markets - like health care or repair services - with their informational asymmetries between expert sellers and uninformed customers are prone to fraudulent behavior of sellers and resulting market inefficiencies. Only little is known so far about how diagnostic uncertainty of...

Persistent link: https://www.econbiz.de/10012237208