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We use a game theoretical framework to analyze the intraday behavior of banks with respect to settlement of interbank claims in a real-time gross settlement setting. The game played by banks depends upon the intraday credit policy of the central bank and it encompasses two well-known game theoretical paradigms: the prisoner's dilemma and the stag hunt. The(More)
In standard auctions with symmetric, independent private value bidders resale creates a role for a speculator—a bidder who is commonly known to have no use value for the good on sale. For second-price and English auctions the efficient value-bidding equilibrium coexists with a continuum of inefficient equilibria in which the speculator wins the auction and(More)
For patients who suffer from leukemia or other blood diseases, a stem cell transplant frequently offers the best chance of survival. Such a transplant is likely to be a life saving event. According to the Web site of the London Health Sciences Centre (2006): " Long-term survival may be greater than 80 per cent, … depending on the type of disease treated,(More)
  • R A Garratt
  • 2001
In ancient times the midwife was often also a healer, serving communities and women and passing knowledge and insights from woman to woman, mother to daughter. Much of this knowledge has been 'lost' or 'forgotten' due to the witch hunts of the Middle Ages and the discrediting of women's knowledge as scientific rationality emerged. There is evidence now that(More)
When second-price auctions have been conducted in the laboratory, most of the observed bids have been " overbids " (bids that exceed the bidder's value) and there are very few underbids. Few if any of the subjects in those experiments had any prior experience bidding in auctions. We report on sealed-bid second-price auctions that we conducted on the(More)
This paper presents preliminary findings and is being distributed to economists and other interested readers solely to stimulate discussion and elicit comments. The views expressed in the paper are those of the authors and are not necessarily reflective of views at the Federal Reserve Bank of New York or the Federal Reserve System. Any errors or omissions(More)
In economies with indivisible commodities, consumers tend to prefer lotteries in commodities. A potential mechanism for satisying these preferences is unrestricted purchasing and selling of lotteries in decentralized markets, as suggested in Prescott and Townsend [-Int. Econ. Rev. 25, 1-20]. However, this paper shows in several examples that such lottery(More)
We analyze sunspot-equilibrium prices in nonconvex economies with perfect markets and a continuous sunspot variable. Our primary result is that every sunspot equilibrium allocation can be supported by prices that, when adjusted for probabilities, are constant across states. This result extends to the case of a finite number of equally probable states under(More)
" Why do I rob banks? Because that's where the money is. " – Willie Sutton Bank of Canada working papers are theoretical or empirical works-in-progress on subjects in economics and finance. The views expressed in this paper are those of the authors. No responsibility for them should be attributed to the Bank of Canada, the Federal Reserve Bank of New York,(More)