Institutions and Financial Markets
My thesis deals with Institutions and Financial markets. In chapter 2, of my thesis the role of government in achieving technological progress in an insecure property rights environment is discussed. In such a setting, it is shown that publicly-funded protection of private property rights may successfully support the adoption of frontier technologies as Nash equilibrium which is not possible otherwise.In chapter 3, I study an investment problem faced by a risk averse investor who has the option to invest in a risk free asset (such as a bank account ) and a risky asset. The wealth can be transferred between the two assets and there are no transaction costs.The objective is to find an optimal quitting time from the stock market which maximizes the expected discounted utility from terminal wealth. I show the optimal stopping time is of threshold type. Finally in Chapter 4, I discuss numerical results in the context of chapter 3 and future research topics.