We develop a model in which information about a firm’s value can be obtained from two sources: (i) voluntary disclosure by a firm’s manager, if she is informed, and (ii) an exogenous source – news – with uncertain accuracy, i.e.,...

We investigate the competitive effects of spot-price contracting, in which a buyer and seller contract to transact at a future date at the price prevailing in that market at that future date (the "spot price"); such contracts are ubiquitous in...

Prediction markets increasingly list contracts settling on an asset price that holders can move by trading the underlying. We build a model showing that such contracts transfer wealth from prediction-market liquidity traders to manipulators and harm price discovery in the...

We examine the general equilibrium impact of a private currency. If the government is predatory and has a monopoly over money issuance, it issues too
much money, in order to finance excessive public expenditures. In this context, what are the consequences...

Large language models (LLMs) perform well on well-defined tasks, but effective
prompting is challenging when tasks depend on users’ soft traits. We introduce prefer-
ence uncertainty—capturing soft information—into a cheap talk framework (Crawford
and Sobel, 1982) and model the communication of soft traits...

How do countries build a reputation for debt discipline? I develop a continuous-time model in which an impatient government, whose income follows a jump-diffusion process, finances consumption by issuing long-term debt to patient investors. The opportunistic government cannot commit to...