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Full-Text Articles in Economic Theory
Μood Effects In Optimal Debt Contracts, Nicholas Apergis, Dimitris Voliotis
Μood Effects In Optimal Debt Contracts, Nicholas Apergis, Dimitris Voliotis
Dimitris Voliotis
The impact of strong emotions or mood on decision making and risk taking is well recognized in behavioral economics and finance. Yet, and in spite of the immense interest, no study, so far, has provided any comprehensive evidence on the impact of such emotions on financial contracts and particularly on debt contracts. This paper provides the theoretical framework to study the impact of mood on financial contracting.
Achieving Cooperation In The Arms Race Game. Two New Approaches, Dimitris Voliotis
Achieving Cooperation In The Arms Race Game. Two New Approaches, Dimitris Voliotis
Dimitris Voliotis
When the risks of national security associated to inferior military power are perceived to be high, the interaction between rival countries resembles a prisoner dilemma with an arms race as its inevitable dominant strategy equilibrium. This paper investigates two different ideas. First, we incorporate in the static form of the game a psychological payoff associated to the perception of motivations and, second we extend the game in a dynamic setup, with overlapping terms of statesmen. In both cases, we find ways out of the arms race equilibrium.