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Harsh default penalties lead to Ponzi schemes: A counterexample

Article ID Journal Published Year Pages File Type
5072216 Games and Economic Behavior 2012 6 Pages PDF
Abstract
► This paper aims at providing a counterexample to Páscoa and Seghir (2009). ► We show that a competitive equilibrium with no trade can be supported. ► This is due to unduly pessimistic expectations on asset deliveries.
Keywords
D91D52Ponzi schemescollateral
Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
Preview
Harsh default penalties lead to Ponzi schemes: A counterexample
Authors
V. Filipe Martins-da-Rocha, Yiannis Vailakis,
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Journal
Games and Economic Behavior
Journal: Games and Economic Behavior
Related Categories
D91
D52
Ponzi schemes
collateral
Economics and Econometrics
Economics, Econometrics and Finance (General)
Finance
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