This paper argues that involuntary unemployment can persist under competition; namely, if the ability of workers to commit themselves is limited and it is more costly for firms to provide information about the quality of unemployed than of employed workers. The problem is that, unless...

We study equilibrium selection by evolutionary learning in monotone signalling games. The learning process is a development of that introduced by Young for static games extended to deal with incomplete information and sequential moves; it thus involves stochastic trembles. For vanishing trembles...

The concept of capabilities, introduced originally by Sen, has inspired many researchers but has not found any simple formal representation which might be instrumental in the construction of a comprehensive theory of equality. In a previous paper (Keiding, 2005), we investigated whether...

Two agents negotiate, according to the Nash bargaining solution, over the allocation of a single (divisible) commodity (or multiple commodities with fixed ordinal preferences). It has been shown that in this situation agents find dominant to report their least risk averse utility functions. This...

The paper discusses the determination of wages, prices, productivity and unemployment in the Euro-wide area in the post Bretton Woods period. The econometric results provide strong evidence on a regime shift at the start of the EMS and the empirical analysis is done separately for the two...

This paper offers two refinements of the traditional risk measure based on the volatility of growth. First, we condition GDP growth on structural characteristics of the host country that move only slowly and therefore can be partly predicted by an investor. Second, we adjust conditional risk for...

Agents trade in the housing market either now, where there is uncertainty concerning the future tax rule for house-owners, or later, when this uncertainty has been resolved. We show that when changes in the tax rule are expected to have a not too heavy impact on the future price of houses, there...

This paper is about using specific investments and secured debt to shield a firm from exploitation by a regulatory authority. It is shown that specific investments and secured debt constrain the regulatory authority in its choice of regime, by providing a credible threat of bankruptcy.

For market games which feature multiple posts for each commodity we show the following: (i) the 'law of one price' obtains asymptotically as the number of market participants becomes infinite, irrespectively of the characteristics of market participants; (ii) as the number of markets increases...