Systemic financial crises involve debt (leverage). We provide a theory of the optimality of debt, which nevertheless can lead to a crisis. Trade is best implemented by debt because it provides the smallest incentive for private information production, which creates trade-reducing adverse selection. Debt preserves symmetric ignorance between counterparties. Debt is least information-sensitive: t...

Nowadays, companies confront many ups and downs due to optimal or destructive decisions made by corporate executives based on industry trends information. Complexities and environmental uncertainties have made companies more dependent on information. But increasing and accumulation of information may reduce the quality of managerial decisions as well as waste the time. This involves assessment ...