The technological transformation of capital markets

The Technological Transformation of Leisure

Essays in Capital Markets

This thesis consists of three essays in capital markets. The first essay presents a dynamic asset pricing model with heterogeneously informed agents. Unlike previous research, the general case where differential information leads to the problem of "forecasting the forecasts of others" and to non-trivial dynamics of higher order expectations is studied. In particular, it is proved that the model...

Carbon markets and technological innovation

This paper examines the effects of firm-level innovation in carbon-abatement technologies on optimal cap-and-trade schemes with and without price controls. We characterize optimal cap-and-trade regulation with price cap and price floor, and compare it to the special cases of pure taxation and simple emissions cap. Innovation shifts the tradeoff between priceand quantity-based instruments toward...

Commentary: The Integration of World Capital Markets

It is important to consider therefore the economic effects of these links among national capital markets, including the effects on investment, growth, monetary policy, and exchange rates. In their paper for this conference, Michael Mussa and Morris Goldstein have combined a wide-ranging summary of the existing research on the integration of world capital markets with their own carefully conside...

On the Impossibility of Perfect Capital Markets

Perfect capital markets require linear budget constraints, without credit rationing creating any tight borrowing constraints before the end of agents’ economic lifetimes. Yet lifetime linear budget constraints are totally unenforceable. This paper considers what allocations can be enforced through monitoring in a simple two period economy when agents have private information regarding their end...