2025 Zayira Ray
Julius Silver Professor, Faculty of Arts and Science,
Professor of Economics, New York University
Research Associate, NBER
Part-Time Professor, University of Warwick
Research Fellow, CESifo
Spool Member, ThReD

Department of Economics, 
New York University,
19 West 4th Street
New York, NY 10012, U.S.A.
debraj.ray@nyu.edu, +1 (212)-998-8906.

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Oxford University Press, 2008. This book is now open-access; feel free to download a copy, and to buy the print version if you like the book.
≋ Three Randomly Selected Papers
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Cooperation in Community Interaction without Information Flows

(with Parikshit Ghosh), Review of Economic Studies 63, 491–519, 1996.

Summary. We study cooperative behavior in communities where the flow of information regarding past conduct is limited or missing. Players are initially randomly matched with no knowledge of each other’s past actions; they endogenously decide whether or not to continue
the repeated relationship. We define social equilibrium in such communities. Such equilibria
are characterized by an initial testing phase, followed by cooperation if the test is successful. It is precisely the presence of myopic types that permit cooperation, by raising barriers to entry into new relationships.

Status, Intertemporal Choice, and Risk-Taking

(with Arthur Robson), Econometrica  80, 1505–1531 (2012). Online Appendix.

Summary. This paper studies endogenous risk-taking by embedding a concern for status (relative consumption) into an otherwise conventional model of economic growth. We prove that if the intertemporal production function is strictly concave, an equilibrium must converge to a unique steady state in which there is recurrent endogenous risk taking.

Information Aggregation in a Financial Market with General Signal Structure

(with Youcheng Lou, Sahar Parsa, Duan Li and Shouyang Wang),  Journal of Economic Theory 183, 594–624 (2019).

Summary. We study a financial market with asymmetric, multidimensional trader signals that have general correlation structure. Each of a continuum of traders belongs to one of finitely many “information groups.” There is a multidimensional aggregate signal for each group. Each trader observes an idiosyncratic signal about the fundamental, built from this group signal. Correlations across group signals are arbitrary. Several existing models serve as special cases, and new applications become possible. We establish existence and regularity of linear equilibrium, and demonstrate that the equilibrium price aggregates information perfectly as noise trade vanishes. Combines and extends results in Parsa and Ray (2017) and Lou, Li and Wang (2017), both mimeo. Online Appendix.