We study a macro-finance model with entrepreneurs who have diverse views about the likelihood that their ideas will lead to successful innovations. These views and the resulting experimentation stimulate economic growth and overcome market failures that would otherwise occur in...

Financial over-the-counter markets have been traditionally very opaque. Recent regulation promotes transparency in some of these markets by lowering search costs, allowing traders to request quotes from multiple dealers at the same time (pre-trade transparency), and requiring public disclosure of...

We present a model of secured lending in which borrowers and lenders agree to disagree about collateral values. Lenders' beliefs distort equilibrium prices of collateralized assets, and the extent to which lenders' beliefs distort prices is mediated by borrower riskiness....

Policy makers have developed different forms of policy intervention for stopping,
or preventing runs on financial firms. This paper provides a general framework to
characterize the types of policy intervention that indeed lower the run-propensity
of investors...