Showing papers in "Journal of Economic Theory in 2008"

TL;DR: The authors developed a simple analytical framework for monetary policy analysis and showed that the aggregate dynamics and stability properties of an otherwise standard business cycle model depend nonlinearly on the degree of asset market participation.

TL;DR: An axiomatic model of decision making which incorporates objective but imprecise information and explains how subjective belief varies with information is presented, which identifies an explicit attitude toward imprecision that underlies usual hedging axioms.

TL;DR: In this article, the authors introduce the concept of a conditional small world event domain, which is an extension of the notion of a small world as a self-contained collection of comparable events.

TL;DR: Both the star architecture and payoff inequality are preserved in an extension of the model where agents can make transfers and bargain over the formation of links, under the condition that the surplus of connections increases in the size of agents' neighborhoods.

TL;DR: In this paper, the authors investigate the structure of selfenforcing insurance networks and discuss the effect of discounting on stability, concluding that thin and thickly connected networks tend to be stable, whereas intermediate degrees of connectedness jeopardize stability.

TL;DR: In this paper, the authors construct a model where capital competes with fiat money as a medium of exchange, and establish conditions on fundamentals under which fiat money can be both valued and socially beneficial.

TL;DR: This work characterize the most revealing equilibrium of this game and shows that an increase in the strength of the traders' reputational concerns has a negative effect on the extent of information that can be revealed in equilibrium but a positive effect on market liquidity.

TL;DR: The optimal contract is characterized and existence and uniqueness are shown, which cannot occur if the cost of inducing effort in the standard principal-agent problem is convex.

TL;DR: An axiomatic model of decision making under uncertainty in which the decision maker is driven by anticipated ex post regrets and both regret aversion and likelihood judgement over states to coexist is provided.

TL;DR: In this paper, a search-theoretic model of the cross-sectional distribution of asset returns, abstracting from risk premia and focusing exclusively on liquidity, is developed, and the qualitative predictions of the model are consistent with much of the empirical evidence.

TL;DR: A new concept for full implementation is introduced that takes into account agents' preferences for understanding how the "process" works, and shows that the presence of such preferences functions very effectively in eliminating unwanted equilibria from the practical perspectives, even if the degree of preference for honesty is small.

TL;DR: If interactions are not "too global" but information is fluid enough, it is shown that the efficient action is the only one which can spread contagiously to the whole population from an initially small, finite subgroup.

TL;DR: A family of natural methods meeting the requirements for impartial division, for a division among four or more participants, are proposed.

TL;DR: In this paper, the authors proposed an explanation of merger waves based on the interaction between competitive pressure and irreversibility of mergers in an uncertain environment, where a set of acquirers compete over time for scarce targets.

TL;DR: The quality of advice that an informed and biased expert gives to an uninformed decision maker is studied and it is found that in many scenarios nondisclosure allows for higher welfare for both parties.

TL;DR: In this article, the authors consider the problem of judgment aggregation in the setting of the agenda and the premisses, and obtain necessary and sufficient conditions under which the combination of both approaches leads to dictatorship (resp. oligarchy), either just on the agenda or on the whole agenda.

TL;DR: In this article, the authors prove two theorems about economies with a finite number of infinitely lived agents who trade a complete set of one-period Arrow securities and several infinitely lived securities at each date, subject to short-sales constraints.

TL;DR: This work shows that the strong and not very plausible IIA condition can be replaced with a minimal independence assumption plus a Pareto-like condition and likens it to Arrow's and arguably enhances its paradoxical value.

TL;DR: A theory of decision making is proposed that offers an axiomatic basis for the notion of "satisficing" postulated by Herbert Simon, requiring instead that his ability to perceive any given preference be decreasing with respect to the complexity of the choice problem at hand.

TL;DR: A model of innovation and international trade in which inventors auction their technology in both domestic and foreign markets is presented, in which technology trade improves the quality of innovation by increasing the pool of R&D experiments from which the best technology is chosen.

TL;DR: In this article, the authors deal with an endogenous growth model with vintage capital and more precisely with the AK model proposed in [R. Boucekkine, O. Licandro, L. Puch, F. del Rio, and L.A.

TL;DR: In a principal-agent model with hidden information and no monetary transfers, the Veto-Power Principle is established: any incentive-compatible outcome can be implemented through veto-based delegation with an endogenously chosen default decision.

TL;DR: It is shown how the border-collision bifurcation leads from the stable fixed point to pure chaotic regime (which consists either in 4-cyclical chaotic intervals, 2-cyclicals chaotic intervals or in one chaotic interval).

TL;DR: A subgame perfect Nash equilibrium of a common property productive asset oligopoly is built and it is shown that the steady state level of asset can be a decreasing function of the asset's implicit growth rate.

TL;DR: This article examined simple monetary and fiscal policy rules consistent with determinate equilibrium dynamics in the absence of Ricardian equivalence and found that without explicit reference to the level of government debt, it is not possible to infer how strongly the monetary or fiscal instruments should be used to ensure determinate equilibria.

TL;DR: Noncooperative household models with two agents and several voluntarily contributed public goods are studied, deriving the counterpart to the Slutsky matrix and demonstrating the nature of the deviation of its properties from those of a true Slutski matrix in the unitary model.

TL;DR: It is shown that the occurrence of over-investment and the behavior of capital accumulation depend on the rate of inflation, the relative risk aversion of agents and the marginal productivity of the capital goods.

TL;DR: In this paper, the authors show that correlations arise naturally in non-cooperative games, e.g., in the equivalence between undominated and optimal strategies in games with more than two players.

TL;DR: A class of imitation dynamics with mutations for games with any finite number of actions is analyzed, and conditions for the selection of a unique equilibrium as the mutation rate becomes small and the population becomes large are given.

TL;DR: In this paper, a model of non-cooperative multilateral unanimity bargaining on a full-dimensional payoff set is studied, where the probability distribution with which the proposing player is selected in each bargaining round follows an irreducible Markov process.