We study how securities and trading mechanisms can be designed to optimally mitigate the adverse impact of market imperfections on liquidity. Asset owners seek to obtain liquidity by selling their claims on future cash-flows, on which they have private information. Our analysis encompasses both...

We examine local stability under learning of stationary Markov sunspot equilibria (SSEs) in a simply dynamic nonlinear model. Necessary and sufficient conditions for local convergence of a recursive learning algorithm to SSEs are shown to be given (generically) by expectational stability...

This paper looks at connections between Renegotiation Proof Equilibrium sets for finitely and infinitely repeated games. We look at the Benoit and Krishna (1993) definition of renegotiation proof sets for discounted finitely repeated games. We focus on the long run behaviour of these sets for...