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A fully informed agent bets with an uninformed over the capital gains of an asset. A divide-and-choose idea is adapted to induce both trade and revelation of information, but in equlibrium the uninformed buys high and sells low if he is downside risk averse. The result may be seen as an informed-price-maker counterpart of some findings of Glosten-Milgrom (1985) and Kyle (1985) on uninformed agents trading in financial markets.

MACROECONOMICS LECTURES -- Contents -- Preface by Francesco Giavazzi -- To the teacher and the student -- Accompanying resources in Mybook -- Chapter 1. GDP, Prices, Inflation, Interest -- 1.1 National Accounting -- 1.2 Prices, quantities, time and rates -- 1.3 Two more elaborate examples -- 1.4 The case Y = G -- 1.5 Beyond GDP? -- 1.6 Exercises -- Chapter 2. Economic Growth: the Solow Model -- 2.1 Introduction -- 2.2 The Solow growth model -- 2.3 What would come next: endogenous growth -- 2.4 Exercises -- Chapter 3. From Solow to the IS curve -- 3.1 From the long run to the short run -- 3.2 The change of perspective -- 3.3 Savings and Investments: the IS curve -- 3.4 The paradox of saving -- 3.5 Effective Demand -- 3.6 Shifts of the IS curve -- 3.7 Exercises -- Chapter 4. The economy with flexible prices -- 4.1 Introduction -- 4.2 The model and equilibrium with flexible prices -- 4.3 Economic analysis of the model -- 4.4 Money supply and financial intermediation -- 4.5 Exercises -- Chapter 5. The point of view of JM Keynes -- 5.1 Alternative solution of the model -- 5.2 Introduction to Keynesian analysis -- 5.3 Exercises -- Chapter 6. IS-LM equilibrium with linear functions -- 6.1 Equilibrium computation -- 6.2 Dependence of equilibrium on G and M -- 6.3 Effectiveness of fiscal and monetary policy -- 6.4 Exercises -- Chapter 7. Equilibrium and adjustments -- 7.1 Introduction: vertical AS, horizontal AS -- 7.2 IS-LM equilibrium, recap of transitions -- 7.3 Convergence to general equilibrium -- 7.4 Government and the Central Bank -- 7.5 Interest rate target: the IS-MP model -- 7.6 Exercises -- Chapter 8. Labour market and price expectations: AS-AD analysis -- 8.1 Introduction -- 8.2 Labour market -- 8.3 The AS curve -- 8.4 Stable general equilibrium -- 8.5 Temporary general equilibrium -- 8.6 Transitions between equilibria

Abstract
Intervention often does not lead to peace, but rather to prolonged conflict. Indeed, we document that it is an important source of prolonged conflicts. We introduce a theoretical model of the balance of power to explain why this should be the case and to analyse how peace can be achieved: either a hot peace between hostile neighbours or the peace of the strong dominating the weak. Non-intervention generally leads to peace after defeat of the weak. Hot peace can be achieved with sufficiently strong outside intervention. The latter is thus optimal if the goal of policy is to prevent the strong from dominating the weak.

How can a small special interest group successfully get an inefficient transfer at the expense of a much larger group with many more resources available for lobbying? We consider a simple model of collusive organizations that provide a public good in the form of effort and have a fixed cost per member of acting collusively. Our key result is that the willingness of such a group to pay for a/ngiven prize depends on whether the prize is fungible - that is, whether the prize can be used to pay for itself. If the prize is fungible, as in the case of a transfer payment, a smaller group always has an advantage. If the prize is non-fungible - civil rights for example - willingness to pay first increases then decreases with the size of the group. We use the theory to study agenda setting/nboth with and without blackmail by the politician showing that in general the small group is not too greedy: when it wins it optimally chooses to pre-empt the large group by choosing a prize small enough to equal the large group participation cost. ; The ADEMU Working Paper Series is being supported by the European Commission Horizon 2020 European Union funding for Research & Innovation, grant agreement No 649396.