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Dramatic symmetries in strategies and techniques of persuasion create challenges to the functioning of established actors in the global media ecology, including international broadcasters. This essay articulates an adaptation of the concept of asymmetric warfare to the field of propaganda, persuasion and recruitment. It examines the particular challenge of certain asymmetric entrants, including ISIS and categorizes how the more traditional entities and government institutions react to these new entrants in markets for loyalties.

In this paper, I conduct one of the first evaluations of a voluntary management program that features an independent verification mechanism to determine whether it is achieving its ultimate objectives. Using a sample of thousands of manufacturing facilities across the United States, I find evidence that the ISO 14001 Environmental Management System Standard has attracted companies with superior environmental performance, and that adoption leads to further performance improvement. This contrasts sharply with findings from prior evaluations of voluntary management programs that lacked verification mechanisms. This suggests that independent verification mechanisms such as certification may be necessary for voluntary management programs to mitigate information asymmetries surrounding difficult-to-observe management practices. Implications are discussed for the industry-associations, government agencies, and the non-governmental organizations that design these programs, the companies that are investing resources to adopt these programs, and those that are relying on them as a credible signal of superior management practices. The substantial variation in magnitude and significance of the results across comparison groups and performance metrics highlights the need for researchers to conduct robustness tests when evaluating voluntary management programs.

With emerging recognition of changing climates' impact on agricultural productivity, a sharper lens is focused on how to target agricultural public investments for development. This paper contributes to an understanding of budget decision-making processes in agricultural development, by examining to what extent those with superior information and expertise on a sector have sway over how public resources to the sector are allocated. The empirical qualitative analysis of this paper employs process tracing with an embedded case study design, based on interviews of 79 senior public sector key-informants in Nigeria. We also analyzed quantitative public expenditure data in the study areas. We draw insights from theories of information asymmetries in the public sector along three dimensions. Within the first type of information asymmetry, we find that, despite the higher agricultural technical expertise that sector bureaucrats have vis-à-vis the elected non-sector-specific chief executives, it is the latter who heavily influence agricultural resource allocation. In the second form of information asymmetry, the benefits from superior lower-tier information are only exploited at one subnational (state) level but not at the other (local government) level. Within the third kind of information asymmetry, public leaders prioritize funding for those types of public investments that are more visible by their nature, and outputs of which materialize relatively rapidly; this disfavors agriculture. Going beyond the literature on the impact of information interventions, this study sheds light on the extent to which information already in the public sector is tapped into to guide the provision of public goods and services. ; IFPRI3; CRP2; Feed the Future Nigeria Agricultural Policy Project; ISI ; PIM ; PR ; CGIAR Research Program on Policies, Institutions, and Markets (PIM)

Corporate carbon footprint data has become ubiquitous. This data is also highly promissory. But as this paper argues, such data fails both consumers and citizens. The governance of climate change seemingly requires a strong foundation of data on emission sources. Economists approach climate change as a market failure, where the optimisation of the atmosphere is to be evidence based and data driven. Citizens or consumers, state or private agents of control, all require deep access to information to judge emission realities. Whether we are interested in state-led or in neoliberal 'solutions' for either democratic participatory decision-making or for preventing market failure, companies' emissions need to be known. This paper draws on 20 months of ethnographic fieldwork in a Fortune 50 company's environmental accounting unit to show how carbon reporting interferes with information symmetry requirements, which further troubles possibilities for contesting data. A material-semiotic analysis of the data practices and infrastructures employed in the context of corporate emissions disclosure details the situated political economies of data labour along the data processing chain. The explicit consideration of how information asymmetries are socially and computationally shaped, how contexts are shifted and how data is systematically straightened out informs a reflexive engagement with Big Data. The paper argues that attempts to automatise environmental accounting's veracity management by means of computing metadata or to ensure that data quality meets requirements through third-party control are not satisfactory. The crossover of Big Data with corporate environmental governance does not promise to trouble the political economy that hitherto sustained unsustainability.

To understand economic growth, this paper looks at transaction costs and how they affect how much money people make. It shows transaction costs, market failure, and economic underdevelopment. Many people think that the problems with development are because markets can't do their job of allocating resources. Some people don't believe that the market doesn't work and blame the government instead. If you look at the people who say that market failure is the root of economic backwardness, very few, if any, look at transaction costs and how they are linked to market failure. People who read this paper want to connect development economics with transaction cost theory and new institutional analysis.

We study the information consequences of conservatism in accounting. Prior research shows that information asymmetries in capital markets lead to firm-level increases in conservatism. In this paper, we further argue that increases in conservatism improve the firm information environment and lead to subsequent decreases in information asymmetries between firm insiders and outsiders. We predict and test if this decrease in information asymmetries manifests itself through: (a) a decrease in the bid-ask spread and in stock-returns volatility, and (b) an improved information environment for financial analysts, leading to more precise and less dispersed forecasts, and to more analysts following the firm. Using a large US sample for the period 1977-2007 and several proxies for conservatism we find robust evidence consistent with our expectations. Our results are in line with conservatism being useful not only for debt-holders, but also for equity-holders. ; We acknowledge financial assistance from the Spanish Ministry of Education and Science (ECO2010–19314, ECO2008–06238/ECON and SEJ2007-67582/ECON), the ICJCE/AT1 UAM-Auditores Madrid Chair, IESE Research Division, the Government of Comunidad de Madrid (Grant CCG10-UC3M/HUM-4760) and the AECA Chair in Accounting and Auditing.

This dissertation explores the relationship between informational asymmetries and costly conflict in the international system. While it is well-known that information asymmetries may cause conflict, little research explores the origins of such asymmetries. This dissertation explores the role of intelligence, diplomacy, and military strategy in revealing information. I show that, under broad conditions, states will often fail to disclose information about themselves and fail to gather information about their opponents. In consequence, the ability to gather information does not undermine the link between uncertainty and war.

Vera-Hernández acknowledges support from the ESRC Centre for the Microeconomic Analysis of Public Policy (RES-544-28-0001). Olivella acknowledges the support of the Government of Catalonia, project 2009SGR-169; as well as from the Ministerio de Educación y Ciencia, project ECO2009-07616 and CONSOLIDER-INGENIO CSD2006-16. Olivella is a Research Fellow of MOVE. ; Altres ajuts: RES-544-28-0001 ; We test for asymmetric information in the UK private health insurance (PHI) market. In contrast to earlier research that considers either a purely private system or one where private insurance is complementary to public insurance, PHI is substitutive of the public system in the UK. Using a theoretical model of competition among insurers incorporating this characteristic, we link the type of selection (adverse or propitious) with the existence of risk-related information asymmetries. Using the British Household Panel Survey, we find evidence that adverse selection is present in the PHI market, which leads us to conclude that such information asymmetries exist.

European banks have been criticized for holding excessive domestic government debt during the recent Eurozone crisis, which may have intensified the diabolic loop between sovereign and bank credit risks. By using a novel bank-level dataset covering the entire timeline of the Eurozone crisis, I first re-confirm that the crisis led to the reallocation of sovereign debt from foreign to domestic banks. In contrast to the recent literature focusing only on sovereign debt, I show that the banks' private sector exposures were (at least) equally affected by the rise in home bias. Consistent with this pattern, I propose a new debt reallocation channel based on informational frictions and show that the informationally closer foreign banks increase their relative exposures when the sovereign risk rises. The effect of informational closeness is economically meaningful and robust to the use of different information measures and controls for alternative channels of sovereign debt reallocation.

This thesis covers issues related to financing in mergers and acquisitions. It studies the relationship between firms' financing conditions and firms' decisions to either buy or sell assets.The first paper, "Cross-border mergers and acquisitions with financially constrained owners", studies the effects of costly external financing in international asset sales. We propose a cross-border merger model with home biased financially constrained owners in which the subsequent investments of the buyer and seller can be determined. We show that governmental policies blocking foreign acquisitions to protect the domestic industry can be counterproductive and propose "financial efficiency" defense in merger law.In the second paper, "Misvaluation and financial constraints: method of payment and buyer identity in mergers and acquisitions", I study how stock price misvaluation and financial frictions affect whether an acquisition occurs between or within industries and whether the acquirer pays in cash or stocks. I set up a model where stock market misvaluation correlates within industries and across industries and assume that managers' have private information regarding their own firm and firms similar to it. The model yields predictions regarding which firm acquires which firm and the method of payment used in transactions. The third paper, "Misvaluation and merger activity", investigates how merger activity varies over time and sectors of the economy. Using data on mergers between publicly traded US firms, I study the role of stock overvaluation on merger activity. I focus on how overvaluation affects mergers occurring within sectors differently from those occurring between sectors and how the effect differs between cash- and stock-financed mergers. The results suggest that marketwide misvaluation does not drive overall merger activity, but that sector-level overvaluation increases the probability that firms conduct stock-financed acquisitions of firms in other sectors. The results indicate that overvaluation affects stock-financed merger activity only if it increases the overvaluation of some firms relative to the overvaluation of other firms. An analysis of the acquisition decisions of individual firms support this interpretation.

In the context of restrictive immigration regimes and nationalist-populist politics, the international humanitarian obligation to consider migrants' claims for political asylum presents states with especially difficult challenges related to "vetting" and "monitoring" migrants. Given that these conditions are unlikely to end any time soon, some authors have suggested solutions to information asymmetries that might lead to effective and more humane outcomes to asylum and refugee crises. This paper evaluates one such proposal, the idea that migrants from "disfavored classes" be admitted in "circles of trust," groups of five or six people which could be held collectively responsible for the bad behavior of any individual member in the context of refugee and migrant policy in contemporary Argentina. Specifically, the paper compares a plan for Syrian refugees in place since 2015, and the reception of large numbers of Venezuelans since 2014. The paper concludes that "circles of trust" are fraught with perils, but that other non-traditional forms of vetting and monitoring might sometimes be humane and useful in particular situations.

Differences in psychological needs and interests have been connected to the endorsement of different belief systems (Jost, Federico & Napier, 2009, p. 314). In 2017, Jost summarized findings connecting existential, relational and epistemic needs to ideology (Jost, 2017, p. 167). This thesis reevaluates the reported results concerning their assessment of ideology, differentiating between indirect and direct measures, symbolic and operational as well as economic and social ideology. Further, additional information on direct measures was derived from the source samples indicated in Jost, 2017. A total of 295 effect sizes was analyzed. Overall, Josts (2017) results were reproducible, with the averages reported in it and the results found never deviating more than r = .10 from each other and straying r ≤ .05 in nearly 89%. Next, separate analyses were conducted to assess the impact of scale-type on the results. Indirect and direct averages differed around r(8) = .12 (.35 < r < .03) from each other, the symbolic and operational averages deviated r(9) = .07 (0 < r < .28) and social and economic ideology differed on average the most with around r(8) = .19 (0 < r < .36). As the sample size for social and economic ideology was rather small, an overall average across the epistemic needs was assessed as well, supporting the previously established impact of measures with the average magnitude sizes deviating r = .21 from each other. All in all, the findings support a more detailed differentiation on measures of ideology in regard of asymmetric psychological predispositions, with averages of different measures only coinciding in three cases and deviating r ≥ .05 in 16 out of 25 cases.

The stability of national and, increasingly more often, the global economy relies on well-functioning financial markets. Households' consumption and saving decisions, firms' investment choices, and governments' financing strategies critically depend on the stability of financial markets. These markets, however, are composed of individuals and institutions that may have different objectives, information sets, and beliefs, making them a very complex object that we do not fully comprehend. Motivated by this, my dissertation focuses on understanding how informational asymmetries and belief heterogeneity impact financial markets, and therefore, the macro economy. More specifically, this dissertation explores the sources of informational asymmetries among market participants. How do different financial market structures provide incentives for private information acquisition? Is information acquisition desirable? What types of policies can be implemented to increase liquidity and "discipline" in financial markets? Could business cycles be related to information or belief cycles? I tackle these questions from three separate angles. First, I study how alternative market designs bring forth different levels of private information generation, "market discipline," and liquidity. Second, I investigate how information sets of key market participants are determined. Finally, I focus on how information and belief fluctuations may affect key macroeconomic variables and economic fluctuations. In Chapter 1, ``Information Acquisition vs. Liquidity in Financial Markets," I propose a parsimonious framework to study markets for asset-backed securities (ABS). These markets play an important role in providing lending capacity to the banking industry by allowing banks to sell the cashflows of their loans and thus recycle capital and reduce the riskiness of their portfolios. In the financial crash of 2008, however, in which certain ABS played a substantial role, we witnessed a collapse in the issuance of all ABS classes. Given the importance of these markets for the real economy, policy makers in the US and Europe have geared their efforts towards reviving them. A good framework to think about these markets is imperative when thinking about financial regulation. The contribution of this chapter is to propose a model that captures the two main problems that have been shown to be present in the practice of securitization. First, the increase in securitization has led to a decline in lending standards, suggesting that liquid markets for ABS reduce incentives to issue good quality loans. Second, securitizers have used private information about loan quality when choosing which loans to securitize, indicating that a problem of asymmetric information is present in ABS markets. A natural question then arises: how should ABS be designed to provide incentives to issue good quality loans and, at the same time, to preserve liquidity and trade in these markets?To address this question, I propose a framework to study ABS where both incentives and liquidity issues are considered and linked through a loan issuer's information acquisition decision. Loan issuers acquire private information about potential borrowers, use this information to screen loans, and later design and sell securities backed by these loans when in need of funds. While information is beneficial ex-ante when used to screen loans, it becomes detrimental ex-post because it introduces a problem of adverse selection that hinders trade in ABS markets. The model matches key features of these markets, such as the issuance of senior and junior tranches, and it predicts that when gains from trade in ABS markets are `sufficiently' large, information acquisition and loan screening are inefficiently low. There are two channels that drive this inefficiency. First, when gains from trade are large, a loan issuer is tempted ex-post to sell a large portion of its cashflows and thus does not internalize that lower retention implements less information acquisition. Second, the presence of adverse selection in secondary markets creates informational rents for issuers holding low quality loans, reducing the value of loan screening. This suggests that incentives for loan screening not only depend on the portion of loans retained by issuers, but also on how the market prices the issued tranches. Turning to financial regulation, I characterize the optimal mechanism and show that it can be implemented with a simple tax scheme. The obtained results, therefore, contribute to the recent debate on how to regulate markets for ABS.In Chapter 2, I present joint work with Matthew Botsch, ``Learning by Lending, Do Banks Learn?" where we investigate how banks form their information sets about the quality of their borrowers. There is a vast empirical and theoretical literature that points to the importance of borrower-lender relationships for firms' access to credit. In this chapter, we investigate one particular mechanism through which long-term relationships might improve access to credit. We hypothesize that while lending to a firm, a bank receives signals that allow it to learn and better understand the firm's fundamentals; and that this learning is private; that is, it is information that is not fully reflected in publicly-observable variables. We test this hypothesis using a dataset for 7,618 syndicated loans made between 1987 and 2003. We construct a variable that proxies for firm quality and is unobservable by the bank, so it cannot be priced when the firm enters our sample. We show that the loading on this factor in the pricing equation increases with relationship time, hinting that banks are able to learn about firm quality when they are in an established relationship with the firm. Our finding is robust to controlling for market-wide learning about firm fundamentals. This suggests that a significant portion of bank learning is private and is not shared by all market participants.The results obtained in this study underpin one of the main assumptions of the model presented in Chapter 1: that banks have a special ability to privately acquire valuable information about potential borrowers. While the model is static, the data suggests that the process of lending and of information acquisition is a dynamic one. Consistent with this, the last chapter of this dissertation studies the macroeconomic implications of dynamic learning by financial intermediaries.Chapter 3 presents joint work with Vladimir Asriyan titled ``Informed Intermediation over the Cycle." In this paper, we construct a dynamic model of financial intermediation in which changes in the information held by financial intermediaries generate asymmetric credit cycles as the one observed in the data. We model financial intermediaries as ''expert'' agents who have a unique ability to acquire information about firm fundamentals. While the level of ''expertise'' in the economy grows in tandem with information that the ''experts'' possess, the gains from intermediation are hindered by informational asymmetries. We find the optimal financial contracts and show that the economy inherits not only the dynamic nature of information flow, but also the interaction of information with the contractual setting. We introduce a cyclical component to information by supposing that the fundamentals about which experts acquire information are stochastic. While persistence of fundamentals is essential for information to be valuable, their randomness acts as an opposing force and diminishes the value of expert learning. Our setting then features economic fluctuations due to waves of ``confidence'' in the intermediaries' ability to allocate funds profitably.

The paper studies the relative merits of direct and representative legislation in a setting where voters are uncertain both with respect to the likely consequences of different policies and with respect to the political preferences of their fellow citizens. Under representative legislation, the latter translates into uncertainty on the elected official's future policy intentions which involves a loss of control. The resulting discretionary power, however, also leads officials to endogenously acquire competence on the issues they oversee and specialize in policy formation. Policies determined in representative democracies are therefore better tailored to relevant contingencies but less close to the preferences of a majority than those determined in popular ballots. It is shown that the extent of the resulting trade-off depends on the set of alternatives among which the policy is to be chosen. Two extensions, referenda and the possibility of re-election, are briefly considered.

In directed graphs, relationships are asymmetric and these asymmetries contain essential structural information about the graph. Directed relationships lead to a new type of clustering that is not feasible in undirected graphs. We propose a spectral co-clustering algorithm called di-sim for asymmetry discovery and directional clustering. A Stochastic co-Blockmodel is introduced to show favorable properties of di-sim To account for the sparse and highly heterogeneous nature of directed networks, di-sim uses the regularized graph Laplacian and projects the rows of the eigenvector matrix onto the sphere. A nodewise asymmetry score and di-sim are used to analyze the clustering asymmetries in the networks of Enron emails, political blogs, and the Caenorhabditiselegans chemical connectome. In each example, a subset of nodes have clustering asymmetries; these nodes send edges to one cluster, but receive edges from another cluster. Such nodes yield insightful information (e.g., communication bottlenecks) about directed networks, but are missed if the analysis ignores edge direction.