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Creditors of a distressed borrower face a coordination problem. Even if the fundamentals are sound, fear of premature foreclosure by others may lead to pre-emptive action, undermining the project. Recognition of this problem lies behind corporate bankruptcy provisions across the world, and it has been identified as a culprit in international financial(More)
The main result of Morris and Shin (2002)–restated in papers by Amato, Morris, and Shin (2002) and Amato and Shin (2003) and commented upon by the Economist (2004)–has been presented and interpreted as an anti-transparency result: more public information can be bad. However, some scrutiny of the result shows that it is actually pro transparency: except in(More)
The theory of global games has shown that coordination games with multiple equilib-ria may have a unique equilibrium if certain parameters of the payoff function are private information instead of common knowledge. We report the results of an experiment designed to test the predictions of this theory. Comparing sessions with common and private information,(More)
This paper explores predictability of behavior in coordination games with multiple equilibria. In a laboratory experiment we measure subjects' certainty equivalents for three coordination games and one lottery. Attitudes towards strategic uncertainty in coordination games are related to risk aversion, experience seeking, gender and age. From the(More)
Financial markets and macroeconomic environments are often characterised by positive external-ities. In these environments, transparency may reduce expected welfare: public announcements serve as focal points for higher-order beliefs and affect agentsÕ behaviour more than justified by their informational contents. Some scholars conclude that reducing public(More)
This chapter surveys laboratory experiments addressing macroeconomic phenomena. The first part focuses on experimental tests of the microfoundations of macroeconomic models discussing laboratory studies of intertemporal consumption/savings decisions, time (in)consistency of preferences and rational expectations. Part two explores coordination problems of(More)
In recent " learning to forecast " experiments (Hommes et al. 2005), three different patterns in aggregate price behavior have been observed: slow monotonic convergence, permanent oscillations, and dampened fluctuations. We show that a simple model of individual learning can explain these different aggregate outcomes within the same experimental setting.(More)
OBJECTIVE The role of non-invasive positive pressure ventilation (NPPV) in stable COPD with chronic ventilatory failure remains controversial. The impact of long-term home nocturnal NPPV treatment on deflation has not yet been evaluated in detail. METHODS Retrospective explorative study of 46 patients with stable COPD undergoing NPPV treatment. Effects of(More)
Agents face a coordination problem akin to the adoption of a network technology. A principal announces investment subsidies that, at minimal cost, attain a given likelihood of successful coordination. Optimal subsidies target agents who impose high externalities on others and on whom others impose low externalities. In relation to recent bailout debates,(More)