Estimados Académicos y Académicas FEN,

Les extendemos la invitación al seminario que organiza el Departamento de Economía, en el que se presentará el trabajo titulado "Managing Overreaction During a Run".

Expone: Caio Machado, Profesor Asociado, PUC.

Abstract:  I propose a global game model of runs with diagnostic investors and use it to study temporary suspensions intended to provide a time-out for agents to digest incoming information. Investors initially overreact to news and suspensions can mechanically prevent them from making decisions based on biased beliefs. I show that during bad times, when bad public news arrives and/or investment returns are low, such policy actually amplifies runs. During good times, the opposite result arises. A small amount of overreaction in beliefs about exogenous fundamentals can lead to large overreaction in beliefs about the action of others in equilibrium.

El formato será presencial y el seminario se desarrollará en la Sala 1605.

Saludos cordiales,

Dirección de Investigación