Trust in Signals and the Origins of Disagreement

Alice Hsiaw, Ing-Haw Cheng   Nov 14,2022

Working Paper No.00047-01

Why do individuals interpret the same information differently? We propose that individuals follow Bayes' Rule when forming posteriors with one exception:... Read More

Providing Incentives with Private Contracts

Qing Liu, Lucy White Andrea Buffa   Nov 18,2022

Working Paper No.00073-01

Agents working together to produce a joint output care about each other’s incentives. Because real world contracts are typically private... Read More

Why is capital slow moving? Liquidity hysteresis and the dynamics of limited arbitrage

James Dow,Jungsuk Han, Francesco Sangiorgi   Sep 20,2018

Working Paper No.00044-00

Will arbitrage capital flow into a market experiencing a liquidity shock, mitigating the adverse effect of the shock on price... Read More

Information Tradeoffs in Dynamic Financial Markets

Efstathios Avdis   Mar 15,2017

Working Paper No.00013-00

In dynamic financial markets the stochastic supply of risky assets has a significant informational role. Contrary to static models, where... Read More

Published: Journal of Financial Economics, 2016, 122(), 568-584