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SUMMARY:Rothschild Lecture:  What do we agree on when we disagree? Forward
  contracts with private forecasts - Eddie Anderson  (University of Sydney)
DTSTART:20190429T150000Z
DTEND:20190429T160000Z
UID:TALK123256@talks.cam.ac.uk
CONTACT:INI IT
DESCRIPTION:Forward contracts are used for hedging purposes when firms ope
 rate in a spot market. What will happen when firms have different views on
  the future distribution of prices and are risk averse? We discuss differe
 nt ways in which two firms may agree on a bilateral forward contract: eith
 er through direct negotiation using the ideas of a Nash bargaining solutio
 n\, or through a broker. We discuss a type of equilibrium in which each fi
 rm offers a supply function linking quantities and prices\, and the cleari
 ng price and quantity for the forward contracts are determined from the in
 tersection. Each firm may also be able to use the offer of the other firm 
 to augment its own information about the future price.<br><br><br><br><br>
LOCATION:Seminar Room 1\, Newton Institute
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