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Jean-Paul Décamps, and Stéphane Villeneuve

vol. 23, n. 1, January 2019, pp. 1–28

We study a corporate finance dynamic contracting model in which the firm's growth rate fluctuates and is impacted by the unobservable effort exercised by the manager. We show that the principal's problem takes the form of a two-dimensional Markovian control problem. We prove regularity properties...

Joao Correia da silva, Bruno Jullien, Yassine Lefouili, and Joana Pinho

vol. 28, n. 1, January 2019, pp. 109–124

This paper discusses the literature on horizontal mergers between multi-sided platforms and argues that the Cournot model can provide useful insights into the welfare effects of such mergers. To illustrate those insights, we develop a simple model in which two-sided platforms offer a homogeneous...

Christian Gouriéroux, and Joann Jasiak

vol. 9, January 2019, pp. 14–41

The martingale hypothesis is commonly tested in financial and economic time series. The existing tests of the martingale hypothesis aim at detecting some aspects of nonstationarity, which is considered an inherent feature of a martingale process. However, there exists a variety of martingale...

Christian Gollier

vol. 80, January 2019, pp. 1–8

Stéphane Caprice, and Shiva Shekhar

vol. 39, n. 1, January 2019, pp. 94–103

Multi-product retailers competing with smaller retailers can exercise market power by pricing below cost products also offered by smaller rivals. Loss-leading is not a predatory strategy: rather pro-competitive justifications are invoked. Unlike standard textbook models, we show that positive...

Pierre-André Chiappori, Bernard Salanié, François Salanié, and Amit Gandhi

vol. 87, n. 1, January 2019, pp. 1–36

We show that even in the absence of data on individual decisions, the distribution of individual attitudes towards risk can be identified from the aggregate conditions that characterize equilibrium on markets for risky assets. Taking parimutuel horse races as a textbook model of contingent markets...

Vincent Berthet, and Benjamin Ouvrard

vol. 5, January 2019, pp. 1–5

This article presents a particular viewpoint on how nudge should be understood. The concept of nudge has generated consid-erable interest among academics and policymakers. However, ten years later, what is meant exactly by “nudge” is still a matter of debate. In fact, there is a fundamental...

Andrea Attar, Thomas Mariotti, and François Salanié

vol. 14, n. 1, January 2019, pp. 297–343

We study a discriminatory limit-order book in which market makers compete in nonlinear tariffs to serve a privately informed insider. Our model allows for general nonparametric specifications of preferences and arbitrary discrete distributions for the insider's private information. Adverse...

Gladys Barragan, Cristina Atance, Astrid Hopfensitz, Jonathan Stieglitz, and Maxime Cauchoix

vol. 10, n. 2719, January 2019

Sylvie Estrela, Eric Libby, Jeremy Van Cleve, Florence Débarre, Maxime Deforet, William Harcombe, Jorge Peña, Sam Brown, and Michael E. Hochberg

vol. 34, n. 1, January 2019, pp. 6–18

Organisms modify their environments in ways that can be beneficial or detrimental not only to themselves but also to others sharing the same environment. Such niche-constructing or niche-destroying activities are often due to the production or consumption of environmental factors, such as resources...