An overview is given of the utilization of strategic market games in the development of a game theory based theory of money and financial institutions. JEL Classifications: C72, C73, E44

A principal seeks to persuade an agent accept offer of uncertain value before a deadline expires. The can generate information, but exerts no control over exogenous outside information. combined effect the and information creates incentives for keep uncertainty high in first periods so as close deadline. We characterize equilibrium, compare it single-player decision problem which is agent’s onl...

We propose a bargaining process with alternating proposals as a way of solving non-cooperative games, giving rise to Pareto efficient agreements which will, in general, differ from the Nash equilibrium of the constituent games. JEL classification: C72; C73; C78.

We characterize transitions between stochastically stable states and relative ergodic probabilities in the theory of the evolution of conventions. We give an application to the fall of hegemonies in the evolutionary theory of institutions and con ict and illustrate the theory with the fall of the Qing Dynasty and rise of Communism in China. JEL Classi cation Numbers: C73 (Evolutionary Games)

We address the question of existence of equilibrium in general timing games with complete information. Under weak assumptions, any two-player timing game has a Markov subgame perfect e-equilibrium, for each e40: This result is tight. For some classes of games (symmetric games, games with cumulative payoffs), stronger existence results are established. r 2004 Elsevier Inc. All rights reserved. J...

In this paper we consider a dynamic model of government formation and termination in parliamentary democracies that accounts for the following phenomena: (1) Cabinet terminations due to replacement or early election (2) Cabinet reshuf°es (3) Minority and Surplus governments; (4) the relative instability of minority governments. JEL classi ̄cation: D72, H19, C73.

We prove that every two-player nonzero-sum deterministic stopping game with uniformly bounded payoffs admits an ε-equilibrium, for every ε > 0. The proof uses Ramsey Theorem that states that for every coloring of a complete infinite graph by finitely many colors there is a complete infinite subgraph which is monochromatic.  2002 Elsevier Science (USA). All rights reserved. JEL classification: ...

We study the speed of social learning, when two players learn from private signals as well as the actions of the other. Our main finding is that increased interaction between the agents can lower the rate of learning: learning is significantly slower when both players observe each other, than when one only observes the other. JEL classifications: C73, D82, D83

We study a dynamic stopping game between principal and an agent. The gradually learns about the agent's private type from noisy performance measure that can be manipulated by agent via costly hidden action. fully characterize unique Markov equilibrium of this game. find terminations/market crashes are often preceded spike in manipulation intensity (expected) performance. Moreover, due to endoge...

This paper models employment relationship as a repeated principal-agent problem with private evaluation. The efficient contracts exhibit correlated movements between lagged wage and current effort that are consistent with the positive feedback between pay and morale in practice. Low morale therefore is an integral part of a well-functioning relationship. (JEL: C73, D82, J41, L14 )