Bernardo Guimaraes

Dynamic coordination among heterogeneous agents

We study a dynamic model of coordination with timing frictions and payoff heterogeneity. There is a unique equilibrium, characterized by thresholds that determine the choices of each type of agent. We characterize equilibrium for the limiting cases of vanishing timing frictions and vanishing shocks to fundamentals. A lot of conformity emerges: despite payoff heterogeneity, agents’ equilibrium thresholds partially coincide as long as there exists a set of beliefs that would make this coincidence possible – though they never fully coincide. In case of vanishing frictions, the economy behaves almost as if all agents were equal to an average type. Conformity is not inefficient. The efficient solution would have agents following others even more often and giving less importance to the fundamental

Intertemporal coordination with delay options

This paper studies equilibrium selection in intertemporal coordination problems with delay options. The risk-dominant action of the underlying one-shot game is selected when frictions are arbitrarily small. Larger frictions introduce real option effects in the model and inhibit coordination.

Dynamic Coordination and the Optimal Stimulus Policies

This article studies stimulus policies in a simple macroeconomic model featuring a dynamic coordination problem that arises from demand externalities and fixed costs of investment. In times of low economic activity, firms face low demand and hence have lower incentives for investing, which reinforces their low‐demand expectations. In a benchmark case with no shocks, the economy might get trapped in a low‐output regime and a social planner would be particularly keen to incentivise investment at times of low economic activity. However, this result vanishes once shocks are considered.

QWERTY is efficient

We study a dynamic coordination problem with staggered decisions where agents choose between two competing networks. If the intrinsically worst one prevails, this is efficient. Moreover, inefficient shifts to the intrinsically best network might occur in equilibrium.

A possibilidade de saltos no câmbio implícita nos prêmios das opções

This paper estimates the parameters of a pricing model which considers the possibility of discrete jumps in the Brazilian exchange rate (Mertons model), from January 1997 to January 1999. Those parameters can be seen as probabilities and expected magnitudes of real devaluation. Such estimates are defended as good measures of credibility of the exchange rate policy that prevailed from March 1995 to January 1999, and it is argued that the possibility of discrete jumps explains the existence of volatility smiles for Brazilian exchange rate options during that period. According to the results presented by this paper, the magnitude of the discrete jump occurred in January 1999 was underestimated by the market and the credibility of the exchange rate policy was mainly affected by crises in other developing countries.

Guarding the Guardians

Good government requires some restraints on the powerful but how can those be imposed if there is no‐one above them? This article studies the equilibrium allocation of power and resources established by self‐interested incumbents under the threat of rebellions from inside and outside the group in power. Commitment to uphold individuals’ rights can only be achieved if power is not as concentrated as incumbents would like it to be, ex post. Power sharing endogenously enables incumbents to commit to otherwise time‐inconsistent laws by ensuring more people receive rents under the status quo and thus want to defend it.

O Comunicado do Banco Central

Esse artigo estuda como a indicacao de politica monetaria contida nos comunicados do Banco Central do Brasil impacta os mercados. Para isso, classificamos a mensagem de cada nota a partir de uma analise semântica. O comunicado e bastante eficaz enquanto informante do futuro da politica monetaria, influenciando quase toda a curva de juros e o Ibovespa e ajudando tambem a prever o conteudo da ata de reuniao do Banco Central.