The rational expectations hypothesis is a bedrock of modern macroeconomics. It is often
combined with a strong, complementary hypothesis that all data about the state of the …

We develop a tractable method for augmenting macroeconomic models with autonomous
variation in higher‐order beliefs. We use this to accommodate a certain type of waves of …

This chapter studies how incomplete information helps accommodate frictions in
coordination, leading to novel insights on the joint determination of expectations and …

We describe and contrast three different measures of an institu (tion $ s credit risk.
HInsolvency risk" is the conditional probability of default due to deterioration of asset quality …

Agents face a coordination problem akin to the adoption of a network technology. A principal
announces investment subsidies that, at minimal cost, attain a given likelihood of successful …

In coordination games and speculative over-the-counter financial markets, solutions depend
on higher-order average expectations: agents' expectations about what counterparties, on …

We study coordination games under general type spaces. We characterize rationalizable
actions in terms of the properties of the belief hierarchies and show that there is a unique …

This paper presents a model in which the contagion of a liquidity crisis between two
nonfinancial institutions occurs because of learning activity within a common creditor pool …

We study learning in a large class of complete information normal form games. Players
continually face new strategic situations and must form beliefs by extrapolation from similar …

We study experimentally how changes in the information structure affect behavior in
coordination games with incomplete information (global games). We find two systematic …