We analyze a union of financially-integrated yet politically-sovereign countries, where households in the Northern core of the union lend to those in the Southern periphery in a unified debt market subject to a borrowing constraint. This constraint generates sudden stops throughout the South,...

We derive the optimal selling mechanism for a monopolist who is privately informed about the attributes of a horizontally differentiated good. To do so, we set up an informed principal problem in a Hotelling model where the buyer's preferences are described in terms of a base consumption value...

Some insurance markets are characterized by “advantageous selection,” that is, ex-post risk and coverage are negatively correlated. We show that expectation-based loss aversion as in K'oszegi and Rabin (2006, 2007) provides a natural explanation for this phenomenon when agents face modest...

A financial union is a group of countries, each with its own nontradable goods sector, which can freely exchange tradable goods and debt contracts. In this paper, we establish the effects of shocks in a stylized financial union with heterogeneous regions -- a lender North and a borrower South --...

In this paper we solve the revenue maximization problem of multi-product monopolist when the products are substitutes. We consider a Hotelling model with two horizontally differentiated goods located at the endpoints of the segment. Consumers are located uniformly on the segment, their...

We analyze a union of financially-integrated yet politically-sovereign countries, where households in the Northern core of the union lend to those in the Southern periphery in a unified debt market subject to a borrowing constraint. This constraint generates sudden stops throughout the South,...

We consider a cloud provider which hosts interactive applications such as mobile apps and online games. Depending on the traffic of users for an application, the provider commits a subset of its resources (hardware capacity) to serve the application. The provider must choose a dynamic pricing...

The first essay explains why credit contracts in developing countries are often denominated in foreign currencies, even after many of these economies succeeded in controlling inflation. I propose a new interpretation based on the demand for insurance against real aggregate shocks. The fact that...