We present three models of the role of asymmetric information in environmental protection. Chapter one considers the market for a green credence good - a good whose environmental characteristics are not observed by the consumer, even ex post - in the presence of environmentally-conscious consumers. Producers may choose to advertise their products. However, if communication is not regulated it can degenerate into "cheap talk". We explore the scope for credible transmission of environmental information by green producers, and the limits on it. In Chapter two we develop some similar themes in an experimental setting, with the focus again on consumer reactions to producer-provided information on the environmental attributes of goods, and the potential role of government to improve social welfare by manipulating the use of certification. In Chapter three the focus is somewhat different, whilst maintaining the theme of the role of information asymmetries in an environmental policy setting. In the model here a regulator has to decide whether or not to regulate a polluting activity with imperfect information regarding the net benefits of so doing. In making her decision, the regulator can listen to an adviser, who may or may not be biased. We look at how the decision maker can exploit the advisories incentive to build reputation to achieve better decisions. As a whole the thesis further underscores and illustrates the critical role that availability and distribution of information plays in policy making aimed at environmental protection.

We consider a pure exchange economy with asymmetric information where individual behavior exhibits ambiguity aversion along the line of maximin expected utility decision making. For such economies we introduce different notions of maximin value allocations. We also introduce a strong notion of (maximin) incentive compatibility. We prove existence and incentive compatibility of the maximin value allocation, when the economy's state space is either finite or non-finite. In the latter case, we provide two different existence results: assuming first countable and then uncountable infinitely many states of nature of the world. We conclude that unlike the Bayesian value allocation approach, incentive compatibility is related to efficiency rather than to direct exchange of information.

<p><strong><p>Title</p><p>The anatomy of financial crises and the current one´s effects on the Swedish<strong> economy.</strong></p><p>Authors</p>Ifete Binaku and Niklas Holmström<strong><p>Background</p></strong></strong></p><p>The subprime crisis started in the United States, but was soon transmitted to other<strong> </strong>countries and even to Sweden. The impact of the financial crisis has had negative consequences for the Swedish real economy, especially in its output. Since Sweden is a big exporting country, its macro economy has been negatively affected by the present global financial crisis.</p><p><strong><p>Purpose</p></strong></p><p>We are interesting to illustrate how the theories can explain the causes and effects<strong> </strong>of financial crises. Therefore, the aim of this study is simply to acquire knowledge on how the impacts on the Swedish economy can be described by theories on financial crises.<strong> </strong></p><p> </p><p>Method</p><p> </p><p>The theoretical models guided our choices of the financial and economic<strong> i</strong>ndicators. The thesis employed a quantitative research approach where the empirical materials are collected from the yearly data period: 2005 to 2009. The secondary analysis has been applied where yeas 2005 to 2009 were selected in order to get an overview of variables developments before financial crises started and in meantime.</p><p><strong><p>Results</p></strong></p><p>Our findings showed that the financial crisis has affected the Swedish economy negatively. Furthermore, the repercussion on the Swedish economy can be better explained by certain parts of the theories combined, than by one theory left alone.</p><p> </p>

Title The anatomy of financial crises and the current one´s effects on the Swedish economy. Authors Ifete Binaku and Niklas HolmströmBackground The subprime crisis started in the United States, but was soon transmitted to other countries and even to Sweden. The impact of the financial crisis has had negative consequences for the Swedish real economy, especially in its output. Since Sweden is a big exporting country, its macro economy has been negatively affected by the present global financial crisis. Purpose We are interesting to illustrate how the theories can explain the causes and effects of financial crises. Therefore, the aim of this study is simply to acquire knowledge on how the impacts on the Swedish economy can be described by theories on financial crises.   Method   The theoretical models guided our choices of the financial and economic indicators. The thesis employed a quantitative research approach where the empirical materials are collected from the yearly data period: 2005 to 2009. The secondary analysis has been applied where yeas 2005 to 2009 were selected in order to get an overview of variables developments before financial crises started and in meantime. Results Our findings showed that the financial crisis has affected the Swedish economy negatively. Furthermore, the repercussion on the Swedish economy can be better explained by certain parts of the theories combined, than by one theory left alone.

This paper examines the properties of the perfect Bayesian Nash equilibrium or equilibria in a model where the new car market coexists with the lemon market which has adverse selection problems. Under such a setting, it is shown that the price of a new car will be affected indirectly by the problems of adverse selection in the lemon market.

Our purpose is to examine: what should be the best subsidy mechanism which can reduce the lost from the asymmetric information problem whereas the administration performs a subsidy policy. We use the incentive contract theory to establish our models, and analyze different kinds of subsidy policy results. We prove that: compare with the partial equally subsidy, zero-subsidy and full-purchase subsidy, the partial discriminably subsidy is the best subsidy policy.

Abstract Information asymmetry in the financial market, especially in the financial organization, usually generates more serious consequences than those in the commodity market. How to reduce or remove the asymmetric information in a bank¡¦s credit rationing has been a challenge for a commercial bank. On the basis of the models developed by Stiglitz and Weiss (1981) and Barro (1986), this study attempts to analyze the issues, faced by a typical commercial bank, of adverse selection, moral hazard, and agent¡¦s reputation, and to simulate the results of such issues in a game-theoretic approach. The study has reached the following conclusions: 1. With regard to the adverse selection issue, this study concludes that if a bank wants to solve the problem of adverse selection on debit and credit, the decision must be made upon the objective evaluation that considers not only the reality and rational assumption but also the external signaling and screening information to assess the enterprise and its investment plan. 2. Regarding the moral hazard issue, this study concludes that if a bank has an effective incentive, the enterprise will automatically select the most beneficial items to the bank on debit. This mechanism reduces the bank¡¦s risk. On the other hand, if a penalty is set forth, then it will be more likely to prevent the moral hazard problem to occur. 3. By the moral hazard model, this study concludes that if an enterprise needs to enter the market to collect funds, it would imply that the game will continue infinitely. Owing to the benefits from reputation is increasing as the number of stage of the game increases, an enterprise will have a strong incentive to build his non-cheating reputation based on a long term consideration. Keywords: Asymmetric Information, Adverse Selection, Moral Hazard, Reputation, Game Theory.

The intrinsic features of woker, ``ability' and ``motivation', are useful resources of human capital that makes profit for the firm. The purpose of the study is to examine how the firm designs the optimal wage policy when worker's intrinsic features are private information. The study follows the mechainsm-design approach, by which models with single, as well as double, intrinsic feature(s) of worker are established, and best ``incentive wage packages' are deduced. We finded out that, under single intrinsic feature, the firm's optimal wage package entails that, the more output the higher wages; under double intrinsic features, the firm must takes the relative strength of intrinsic features of the worker into account when making the optimal incentive wage package.

Using the intraday data on the Taiwan Stock Exchange (TWSE), we address the issue of the informativeness of the limit order book in the periodic call market. We find that the pre-call information variables, i.e., the market order and the radius of the order book, have significant impacts on the trade variables, i.e., trading volume, the post-call bid-ask spread, and the trader surplus. Furthermore, we are able to show that the radius, as well as the market order, contains two differential forces in impacting these trade variables.

This thesis consists of three different papers summarized as follows. In The political economy of environmental regulation, I study how enforcement of national environmental legislation differ across municipalities in Sweden depending on the local political situation. While the legislation is national, enforcement is decentralized. I find that municipalities where the Green Party joins the ruling political coalition issue more environmental fines than other municipalities. In pricing on the fish market I use Swedish data to study how size affects the price per kilo of fish for several species. In traditional fishery biomass models, fish stocks are treated as homogenous. New theoretical heterogeneous fishery models, where size is allowed to differ in a fish stock, have important implications for regulation, for example that it is optimal to regulate on numbers of fish instead of weight. However, prices in these models are assumed to be constant. My estimates can be used to shed some light on how prices change when the size composition of the catch changes. In my third and final chapter, Settlement under the threat of conflict - The cost of asymmetric information, I present a theoretical model where two players can divide a good peacefully or engage in a contest in order to obtain the entire good. I assume that one player's valuation of the good is private information and show how this affects the expected cost of the contest and thus the probability of peaceful settlement.