Related papers: When is Trust Robust?
Behavioral experiments on the trust game have shown that trust and trustworthiness are universal among human beings, contradicting the prediction by assuming \emph{Homo economicus} in orthodox Economics. This means some mechanism must be at…
We study the problem of robust estimation under heterogeneous corruption rates, where each sample may be independently corrupted with a known but non-identical probability. This setting arises naturally in distributed and federated…
We study a cheap-talk game where two experts first choose what information to acquire and then offer advice to a decision-maker whose actions affect the welfare of all. The experts cannot commit to reporting strategies. Yet, we show that…
Mutual trust is a key determinant of decision-making in economic interactions, yet actual behavior often diverges from equilibrium predictions. This study investigates how emotional arousal, indexed by skin conductance responses,SCR,…
We consider thin incomplete financial markets, where traders with heterogeneous preferences and risk exposures have motive to behave strategically regarding the demand schedules they submit, thereby impacting prices and allocations. We…
I study the limit of a large random economy, where a set of consumers invests in financial instruments engineered by banks, in order to optimize their future consumption. This exercise shows that, even in the ideal case of perfect…
We present our approach to the problem of how an agent, within an economic Multi-Agent System, can determine when it should behave strategically (i.e. learn and use models of other agents), and when it should act as a simple price-taker. We…
This paper studies lying in a novel context. Previous work has focused on situations in which people are either fully aware of the economic consequences of all available actions (e.g., die-under-cup paradigm), or they are uncertain, but…
This paper presents a simple agent-based model of an economic system, populated by agents playing different games according to their different view about social cohesion and tax payment. After a first set of simulations, correctly…
We study finite-state communication games in which the sender's preference is perturbed by random private idiosyncrasies. Persuasion is generically impossible within the class of statistically independent sender/receiver preferences --…
In today's global economy, supply chain (SC) entities have become increasingly interconnected with demand and supply relationships due to the need for strategic outsourcing. Such interdependence among firms not only increases efficiency but…
Does electoral replacement ensure that officeholders eventually act in voters' interests? We study a reputational model of accountability. Voters observe incumbents' performance and decide whether to replace them. Politicians may be "good"…
We study a simple model of an asset market with informed and non-informed agents. In the absence of non-informed agents, the market becomes information efficient when the number of traders with different private information is large enough.…
Trust serves as a fundamental pillar of human interactions, playing a crucial role in economic, social, and political relationships. While traditional models of trust primarily focus on the decision making of the first player, this paper…
Indirect reciprocity is a mechanism by which individuals cooperate with those who have cooperated with others. This creates a regime in which repeated interactions are not necessary to incent cooperation (as would be required for direct…
In this work we study the individual strategies carried out by agents undergoing transactions in wealth exchange models. We analyze the role of risk propensity in the behavior of the agents and find a critical risk, such that agents with…
We study the emergence of cooperation in large spatial public goods games. Without employing severe social-pressure against "defectors", or alternatively, significantly rewarding "cooperators", theoretical models typically predict a system…
This essay discusses the advantages of a probabilistic agent-based approach to questions in theoretical economics, from the nature of economic agents, to the nature of the equilibria supported by their interactions. One idea we propose is…
Resources are often limited, therefore it is essential how convincingly competitors present their claims for them. Beside a player's natural capacity, here overconfidence and bluffing may also play a decisive role and influence how to share…
Interconnected agents such as firms in a supply chain make simultaneous preparatory investments to increase chances of honouring their respective bilateral agreements. Failures cascade: if one fails their agreement, then so do all who…