Sorting via Screening vs. Signaling
|
|
- Donald Lyons
- 6 years ago
- Views:
Transcription
1 Sorting via Screening vs. Signaling - Static Frame and Experimental Evidence - Werner Güth and Fabian Winter
2 1. Introduction 2. Static Frame 3. Experimental Design 4. Main Findings 5. Conclusions
3 1. Introduction Sorting via self-selection: important when different types are better treated differently e.g. sickness leave: in Germany sorting by medical doctors when consulted costs of shorter sickness leaves paid by employer self-sorting possible by holiday reduction in case of short-term sickness leave(s)
4 similar problems in case of private information about: neediness (social help programs) trustworthiness (credits, insurance, ) reliability (joint ventures, ) outside options, conflict payoffs (bargaining, territorial fights (incumbent vs. invader) in biology) etc. 4
5 Evolutionary Biology: costly sorting of males (peacocks, elk bulls, e.g. Zahavi and Zahavi) No common knowledge assumption (only by Mother Nature )
6 Game Theory: outragous counterfactual considerations (which choice if I would be what I am not? ) (Harsanyi/Selten, 1972: proving stronger type via not conceding) no trade results when sorting impossible (e.g. Akerlof) Spence: proving one s higher productivity by otherwise inefficient investment also our experimental scenario! 6
7 Sorting via Signaling Screening 1st mover informed party uninformed party 2nd mover uninformed party informed party question revealing one s type or pooling? screening & selfselection? 7
8 Experimentally via sequential protocols (Kübler, Huck, Müller): action sequences as above very different instructions for both implicit & explicit demand effects? different strategy sets and experimental data what is causing what? 8
9 Our approach: common frame as far as possible better control of demand effects! strategy method: not just play data! conditioning instead of timing! less hot? same benchmark equilibria but different off-the-solution play! 9
10 2. Static frame v. Neumann/Morgenstern (1944): normal form captures all what is strategically relevant more recently and similarly: stability concept/refinement of Kohlberg/Mertens (1985) 10
11 both, game form & solution concept, answer: who is the player? the personal omnipotent player (a gametheoretic construct in games with incomplete information the type player the agent player each of several alter egoes (no intrapersonal payoff aggregation) 11
12 Our static setup players: - type (e.g. worker) Other (e.g. employer) private information: - only knows {, } with 1 < - Other expects with prob. p ( with prob. 1 p) where 0 < p < 1 12
13 As in Spence (1973): Signaling via {, } chooses level y 0 wage w may depend on ( ) ( 0) y : w y 13
14 Screening via Other chooses with & Y > 0 wwy, ; 0 w w w is paid to if y < Y w is paid to { } if y Y, chooses y { 0, Y} 14
15 Sorting possible (unlike for lemons, Akerlof): due to costly investment: c y = y ( ) 1 for all y > 0: c y > c y > ( ) ( ) 15
16 Sorting via: Other learns y but not whether y = = y or y y Other s posterior beliefs: e.g. ( y) Prob / = q ( y)( 1 p ) ( )( 1 ) + ( ) q y p q y p where q ( y) : prob. of y y = for {, } requires ( )( ) ( ) q y 1 p + q y p > 0 (e.g. by refinement like uniform perfectness, Güth/Van Damme, 1991) 16
17 Ultimatum Power for { }, : Other pays ( ) = Prob ( / ) + Prob ( / ) w y y y e.g. due to hiring competition of employers 17
18 Equilibria: - here only benchmark equilibria - best pooling: 0 for y = {, } ( ) ( ) w y = p + 1 p for all y 0 prior productivity expectation 18
19 best sorting: y = 0, y = Y ( * ) w(0) =, wy = * where ( ) Y * : = since: 1 * Y > 0 1 * Y = 0 19
20 3. Experimental Design tttt Other (i) Sorting via Screening y Y, w (y ) w,w, Y Signaling y, w (y ) w,w, Y(y) 20
21 3. Experimental Design 2x2 factorial design (i) screening vs. signaling (ii) costs of sorting: either or c y = y c ( ) 1 ( y ) ( ) c 0 if y < Y = c( Y) if y Y 21
22 (i) no difference in physical timing limits demand effects & confounding explanations (like 1st mover advantage) (ii) effect of excessive investments : 0 y Y < < y Y what is due to and? > 22
23 40 rounds with constant role ( or Other) nearly identical instructions, except for (i) and (ii) about 130 minutes 224 participants ( payoff: 15.80) 23
24 4. Main Findings - y y > ( ) 1 but less so when c y = y y - with experience excessive investments must be paid - Y rather stable across rounds 24
25 25
26 - Y does not depend on treatment & insufficient for sorting pooling dominates! more bimodal 26
27 Wage Bargaining: w w w( y) decreases with experience increasing in y but usually ( ) w> w y ( ) w> w y Other reciprocates high y-choices even when they are excessive 27
28 Signaling vs. Screening: w ( y), for both and ( ww, ) Signaling larger for Screening than higher acceptance rates for Screening higher (lower) - earnings of Other ( - types) for Screening efficiency losses due to - conflict: higher in Screening - sorting (y>0): higher in Signaling 28
29 29
30 Aspect Kübler et al.-protocol our protocol wage bargaining hiring competition of two (three) employers ultimatum wage offer of worker to (largest wage offer automatically accepted) single employer single wage offer in case of signaling, two in case of screening two wage demands by worker, two acceptance thresholds by employer sorting play method with only two levels for both, screening and signaling strategy method for one party & a coarse grid incentives flat fee for employer in case of employment variable earnings of both, depending on agreement contract equilibria pooling and separating equilibria in signaling, only separating in screening same best pooling and separating equilibria in both treatments roles number of rounds played role switching after fixed number of periods fixed roles 48 rounds 40 rounds 30
31 5. Qualitatively similar findings (in our notation) - y > y - w(y) y - w > w - earns significantly more than - y independent of treatment - Screening leads to less sorting and more pooling compared to signaling 31
32 Different Results Responsibility for investments y (0, Y) reduces investments w (Y) Y even for Y > Y w does not depend on Y and, of course for our design more informative strategy data less demand effects & confounding explanations 32
33 Thank you for your attention! 33
Module 16: Signaling
Module 16: Signaling Information Economics (Ec 515) George Georgiadis Players with private information can take some action to signal their type. Taking this action would distinguish them from other types.
More informationAdverse Selection, Signaling, and Screening in Markets
BGPE Intensive Course: Contracts and Asymmetric Information Adverse Selection, Signaling, and Screening in Markets Anke Kessler Anke Kessler p. 1/27 Stylized Facts: Market Failure used cars, even if they
More informationWhen to Ask for an Update: Timing in Strategic Communication
When to Ask for an Update: Timing in Strategic Communication Work in Progress Ying Chen Johns Hopkins University Atara Oliver Rice University March 19, 2018 Main idea In many communication situations,
More informationEC319 Economic Theory and Its Applications, Part II: Lecture 7
EC319 Economic Theory and Its Applications, Part II: Lecture 7 Leonardo Felli NAB.2.14 27 February 2014 Signalling Games Consider the following Bayesian game: Set of players: N = {N, S, }, Nature N strategy
More informationWhen to Ask for an Update: Timing in Strategic Communication. National University of Singapore June 5, 2018
When to Ask for an Update: Timing in Strategic Communication Ying Chen Johns Hopkins University Atara Oliver Rice University National University of Singapore June 5, 2018 Main idea In many communication
More informationGame Theory. Wolfgang Frimmel. Perfect Bayesian Equilibrium
Game Theory Wolfgang Frimmel Perfect Bayesian Equilibrium / 22 Bayesian Nash equilibrium and dynamic games L M R 3 2 L R L R 2 2 L R L 2,, M,2, R,3,3 2 NE and 2 SPNE (only subgame!) 2 / 22 Non-credible
More informationThis is designed for one 75-minute lecture using Games and Information. October 3, 2006
This is designed for one 75-minute lecture using Games and Information. October 3, 2006 1 7 Moral Hazard: Hidden Actions PRINCIPAL-AGENT MODELS The principal (or uninformed player) is the player who has
More informationIntroduction to Game Theory
Introduction to Game Theory Part 3. Dynamic games of incomplete information Chapter 3. Job Market Signaling Ciclo Profissional 2 o Semestre / 2011 Graduação em Ciências Econômicas V. Filipe Martins-da-Rocha
More information. Introduction to Game Theory Lecture Note 8: Dynamic Bayesian Games. HUANG Haifeng University of California, Merced
.. Introduction to Game Theory Lecture Note 8: Dynamic Bayesian Games HUANG Haifeng University of California, Merced Basic terminology Now we study dynamic Bayesian games, or dynamic/extensive games of
More informationAdvanced Microeconomics
Advanced Microeconomics ECON5200 - Fall 2012 Introduction What you have done: - consumers maximize their utility subject to budget constraints and firms maximize their profits given technology and market
More informationAdverse selection, signaling & screening
, signaling & screening Applications of game theory 2 Department of Economics, University of Oslo ECON5200 Fall 2009 Seller Buyer Situation 1: Symmetric info One market 1 2 prob high quality 1 2 prob high
More informationGovernment 2005: Formal Political Theory I
Government 2005: Formal Political Theory I Lecture 11 Instructor: Tommaso Nannicini Teaching Fellow: Jeremy Bowles Harvard University November 9, 2017 Overview * Today s lecture Dynamic games of incomplete
More informationEconomics 385: Homework 2
Economics 385: Homework 2 7 March, 2007 Signalling The following questions concern variants of Spence s education model. Unless other stated, the utility of type θ who take e years of education and is
More informationNegotiation: Strategic Approach
Negotiation: Strategic pproach (September 3, 007) How to divide a pie / find a compromise among several possible allocations? Wage negotiations Price negotiation between a seller and a buyer Bargaining
More informationIntroduction to Game Theory
Introduction to Game Theory Part 3. Dynamic games of incomplete information Chapter 2. Signaling Games Ciclo Profissional 2 o Semestre / 2011 Graduação em Ciências Econômicas V. Filipe Martins-da-Rocha
More informationEC476 Contracts and Organizations, Part III: Lecture 2
EC476 Contracts and Organizations, Part III: Lecture 2 Leonardo Felli 32L.G.06 19 January 2015 Moral Hazard: Consider the contractual relationship between two agents (a principal and an agent) The principal
More informationEquilibrium Refinements
Equilibrium Refinements Mihai Manea MIT Sequential Equilibrium In many games information is imperfect and the only subgame is the original game... subgame perfect equilibrium = Nash equilibrium Play starting
More information6.254 : Game Theory with Engineering Applications Lecture 13: Extensive Form Games
6.254 : Game Theory with Engineering Lecture 13: Extensive Form Games Asu Ozdaglar MIT March 18, 2010 1 Introduction Outline Extensive Form Games with Perfect Information One-stage Deviation Principle
More informationECO421: Signaling. Marcin P ski. March 26, 2018
ECO421: Signaling Marcin P ski March 26, 2018 Plan Introduction Education Suits Signaling everywhere Conclusion Introduction Signaling games We talked about communication cheap talk veriable talk Talk
More informationTI-games I: An Exploration of Type Indeterminacy in Strategic Decision-making
TI-games I: An Exploration of Type Indeterminacy in Strategic Decision-making J. Busemeyer (Indiana University) A. Lambert-Mogiliansky (PSE) CNAM February 9 2009 1 Introduction This paper belongs to a
More informationBargaining, Contracts, and Theories of the Firm. Dr. Margaret Meyer Nuffield College
Bargaining, Contracts, and Theories of the Firm Dr. Margaret Meyer Nuffield College 2015 Course Overview 1. Bargaining 2. Hidden information and self-selection Optimal contracting with hidden information
More informationEconS Advanced Microeconomics II Handout on Subgame Perfect Equilibrium (SPNE)
EconS 3 - Advanced Microeconomics II Handout on Subgame Perfect Equilibrium (SPNE). Based on MWG 9.B.3 Consider the three-player nite game of perfect information depicted in gure. L R Player 3 l r a b
More informationMarkets with Asymetric Information
Microeconomics 2 Presentation: Francis Bloch, Slides: Bernard Caillaud Master APE - Paris School of Economics March 6, 2017 (Lecture 9) I. Asymmetric information I.1. Introduction The economy is fundamentally
More informationTeoria das organizações e contratos
Teoria das organizações e contratos Chapter 6: Adverse Selection with two types Mestrado Profissional em Economia 3 o trimestre 2015 EESP (FGV) Teoria das organizações e contratos 3 o trimestre 2015 1
More informationGame Theory. Monika Köppl-Turyna. Winter 2017/2018. Institute for Analytical Economics Vienna University of Economics and Business
Monika Köppl-Turyna Institute for Analytical Economics Vienna University of Economics and Business Winter 2017/2018 Static Games of Incomplete Information Introduction So far we assumed that payoff functions
More informationSequential Games with Incomplete Information
Sequential Games with Incomplete Information Debraj Ray, November 6 For the remaining lectures we return to extensive-form games, but this time we focus on imperfect information, reputation, and signalling
More informationG5212: Game Theory. Mark Dean. Spring 2017
G5212: Game Theory Mark Dean Spring 2017 Signalling We will now move to consider a simple model of costly signalling The classic example of this is the education signalling model by Spence [1973] Different
More informationConfronting Theory with Experimental Data and vice versa. European University Institute. May-Jun Lectures 7-8: Equilibrium
Confronting Theory with Experimental Data and vice versa European University Institute May-Jun 2008 Lectures 7-8: Equilibrium Theory cannot provide clear guesses about with equilibrium will occur in games
More informationMutual Optimism in the Bargaining Model of War
Mutual Optimism in the Bargaining Model of War Mark Fey Kristopher W. Ramsay December 19, 2016 Abstract Mutual optimism is often considered an explanation for war, but recent research has challenged that
More informationInformed Principal in Private-Value Environments
Informed Principal in Private-Value Environments Tymofiy Mylovanov Thomas Tröger University of Bonn June 21, 2008 1/28 Motivation 2/28 Motivation In most applications of mechanism design, the proposer
More informationEconomics 385: Suggested Solutions 2
Economics 385: Suggested Solutions 2 7 March, 2007 Signalling Question 1 (Discrete Action Set) (a) In the separating equilibrium, e (10) = e 1. The high type needs to obtain enough education to separate
More informationEconomics 209B Behavioral / Experimental Game Theory (Spring 2008) Lecture 3: Equilibrium refinements and selection
Economics 209B Behavioral / Experimental Game Theory (Spring 2008) Lecture 3: Equilibrium refinements and selection Theory cannot provide clear guesses about with equilibrium will occur in games with multiple
More information5. Externalities and Public Goods. Externalities. Public Goods types. Public Goods
5. Externalities and Public Goods 5. Externalities and Public Goods Externalities Welfare properties of Walrasian Equilibria rely on the hidden assumption of private goods: the consumption of the good
More informationMinimum Wages and Excessive E ort Supply
Minimum Wages and Excessive E ort Supply Matthias Kräkel y Anja Schöttner z Abstract It is well-known that, in static models, minimum wages generate positive worker rents and, consequently, ine ciently
More informationAsymmetric Information and Search Frictions: A Neutrality Result
Asymmetric Information and Search Frictions: A Neutrality Result Neel Rao University at Buffalo, SUNY August 26, 2016 Abstract This paper integrates asymmetric information between firms into a canonical
More informationTo Commit or Not to Commit: Endogenous Timing in Experimental Duopoly Markets 1
Games and Economic Behavior 38, 240 264 (2002) doi:10.1006/game.2001.0889, available online at http://www.idealibrary.com on To Commit or Not to Commit: Endogenous Timing in Experimental Duopoly Markets
More information5. Externalities and Public Goods
5. Externalities and Public Goods Welfare properties of Walrasian Equilibria rely on the hidden assumption of private goods: the consumption of the good by one person has no effect on other people s utility,
More informationEntry under an Information-Gathering Monopoly Alex Barrachina* June Abstract
Entry under an Information-Gathering onopoly Alex Barrachina* June 2016 Abstract The effects of information-gathering activities on a basic entry model with asymmetric information are analyzed. In the
More informationSocial Learning with Endogenous Network Formation
Social Learning with Endogenous Network Formation Yangbo Song November 10, 2014 Abstract I study the problem of social learning in a model where agents move sequentially. Each agent receives a private
More informationPerfect Bayesian Equilibrium
Perfect Bayesian Equilibrium For an important class of extensive games, a solution concept is available that is simpler than sequential equilibrium, but with similar properties. In a Bayesian extensive
More informationBackwards Induction. Extensive-Form Representation. Backwards Induction (cont ) The player 2 s optimization problem in the second stage
Lecture Notes II- Dynamic Games of Complete Information Extensive Form Representation (Game tree Subgame Perfect Nash Equilibrium Repeated Games Trigger Strategy Dynamic Games of Complete Information Dynamic
More informationBanks, depositors and liquidity shocks: long term vs short term interest rates in a model of adverse selection
Banks, depositors and liquidity shocks: long term vs short term interest rates in a model of adverse selection Geethanjali Selvaretnam Abstract This model takes into consideration the fact that depositors
More informationStatic Information Design
Static Information Design Dirk Bergemann and Stephen Morris Frontiers of Economic Theory & Computer Science, Becker-Friedman Institute, August 2016 Mechanism Design and Information Design Basic Mechanism
More information5. Relational Contracts and Career Concerns
5. Relational Contracts and Career Concerns Klaus M. Schmidt LMU Munich Contract Theory, Summer 2010 Klaus M. Schmidt (LMU Munich) 5. Relational Contracts and Career Concerns Contract Theory, Summer 2010
More informationIntroduction to game theory LECTURE 1
Introduction to game theory LECTURE 1 Jörgen Weibull January 27, 2010 1 What is game theory? A mathematically formalized theory of strategic interaction between countries at war and peace, in federations
More informationCoarse Information Leads to Less Effective Signaling
Journal of Economic Theory and Econometrics, Vol. 9, No. 3, Sep. 018, 58 73 Coarse Information Leads to Less Effective Signaling Guangsug Hahn Joon Yeop Kwon Abstract This study considers firms coarse
More informationOther-Regarding Preferences: Theory and Evidence
Other-Regarding Preferences: Theory and Evidence June 9, 2009 GENERAL OUTLINE Economic Rationality is Individual Optimization and Group Equilibrium Narrow version: Restrictive Assumptions about Objective
More informationUC Berkeley Haas School of Business Game Theory (EMBA 296 & EWMBA 211) Summer 2016
UC Berkeley Haas School of Business Game Theory (EMBA 296 & EWMBA 211) Summer 2016 More on strategic games and extensive games with perfect information Block 2 Jun 12, 2016 Food for thought LUPI Many players
More informationLabor Economics, Lectures 1 and 2: Labor Market Externalities
Labor Economics, 14.661. Lectures 1 and 2: Labor Market Externalities Daron Acemoglu MIT October 26 and 31, 2017 Daron Acemoglu (MIT) Externalities October 26 and 31, 2017 1 / 62 Introduction Introduction
More informationCoordination Games with Information Aggregation
1 / 13 Coordination Games with Information Aggregation Mehdi Shadmehr University of Miami Dan Bernhardt University of Illinois MET October, 2012 2 / 13 incumbent challenger incumbent h, h w, l challenger
More informationDefinitions and Proofs
Giving Advice vs. Making Decisions: Transparency, Information, and Delegation Online Appendix A Definitions and Proofs A. The Informational Environment The set of states of nature is denoted by = [, ],
More informationAsset Pricing under Asymmetric Information Modeling Information & Solution Concepts
Asset Pricing under Asymmetric & Markus K. Brunnermeier Princeton University August 21, 2007 References Books: Brunnermeier (2001), Asset Pricing Info. Vives (2006), and Learning in Markets O Hara (1995),
More informationArea I: Contract Theory Question (Econ 206)
Theory Field Exam Summer 2011 Instructions You must complete two of the four areas (the areas being (I) contract theory, (II) game theory A, (III) game theory B, and (IV) psychology & economics). Be sure
More information4: Dynamic games. Concordia February 6, 2017
INSE6441 Jia Yuan Yu 4: Dynamic games Concordia February 6, 2017 We introduce dynamic game with non-simultaneous moves. Example 0.1 (Ultimatum game). Divide class into two groups at random: Proposers,
More informationIntroduction to Game Theory
COMP323 Introduction to Computational Game Theory Introduction to Game Theory Paul G. Spirakis Department of Computer Science University of Liverpool Paul G. Spirakis (U. Liverpool) Introduction to Game
More informationModels of Reputation with Bayesian Updating
Models of Reputation with Bayesian Updating Jia Chen 1 The Tariff Game (Downs and Rocke 1996) 1.1 Basic Setting Two states, A and B, are setting the tariffs for trade. The basic setting of the game resembles
More informationPatience and Ultimatum in Bargaining
Patience and Ultimatum in Bargaining Björn Segendorff Department of Economics Stockholm School of Economics PO Box 6501 SE-113 83STOCKHOLM SWEDEN SSE/EFI Working Paper Series in Economics and Finance No
More informationThe Impact of Organizer Market Structure on Participant Entry Behavior in a Multi-Tournament Environment
The Impact of Organizer Market Structure on Participant Entry Behavior in a Multi-Tournament Environment Timothy Mathews and Soiliou Daw Namoro Abstract. A model of two tournaments, each with a field of
More informationLecture Notes for Economics 200Cb: Games and Information Segment Vincent Crawford Spring 2009 Revised 26 May 2009
Lecture Notes for Economics 200Cb: Games and Information Segment Vincent Crawford Spring 2009 Revised 26 May 2009 1. Adverse Selection (MWG 436-450; Kreps 625-629; Varian 466-469) Competitive labor market
More informationComputational Evolutionary Game Theory and why I m never using PowerPoint for another presentation involving maths ever again
Computational Evolutionary Game Theory and why I m never using PowerPoint for another presentation involving maths ever again Enoch Lau 5 September 2007 Outline What is evolutionary game theory? Why evolutionary
More informationContracts in informed-principal problems with moral hazard
Contracts in informed-principal problems with moral hazard Nicholas C Bedard January 20, 2016 Abstract In many cases, an employer has private information about the potential productivity of a worker, who
More informationCostly Signals and Cooperation
Costly Signals and Cooperation Károly Takács and András Németh MTA TK Lendület Research Center for Educational and Network Studies (RECENS) and Corvinus University of Budapest New Developments in Signaling
More informationCostly Expertise. Dino Gerardi and Leeat Yariv yz. Current Version: December, 2007
Costly Expertise Dino Gerardi and Leeat Yariv yz Current Version: December, 007 In many environments expertise is costly. Costs can manifest themselves in numerous ways, ranging from the time that is required
More informationInformation Design. Dirk Bergemann and Stephen Morris. Johns Hopkins University April 2017
Information Design Dirk Bergemann and Stephen Morris Johns Hopkins University April 2017 Mechanism Design and Information Design Basic Mechanism Design: Fix an economic environment and information structure
More informationComputation of Efficient Nash Equilibria for experimental economic games
International Journal of Mathematics and Soft Computing Vol.5, No.2 (2015), 197-212. ISSN Print : 2249-3328 ISSN Online: 2319-5215 Computation of Efficient Nash Equilibria for experimental economic games
More informationBELIEFS & EVOLUTIONARY GAME THEORY
1 / 32 BELIEFS & EVOLUTIONARY GAME THEORY Heinrich H. Nax hnax@ethz.ch & Bary S. R. Pradelski bpradelski@ethz.ch May 15, 217: Lecture 1 2 / 32 Plan Normal form games Equilibrium invariance Equilibrium
More informationBounded Rationality Lecture 4
Bounded Rationality Lecture 4 Mark Dean Princeton University - Behavioral Economics The Story So Far... Introduced the concept of bounded rationality Described some behaviors that might want to explain
More informationOrganizational Barriers to Technology Adoption: Evidence from Soccer-Ball Producers in Pakistan
Organizational Barriers to Technology Adoption: Evidence from Soccer-Ball Producers in Pakistan David Atkin, Azam Chaudhry, Shamyla Chaudry Amit K. Khandelwal and Eric Verhoogen Sept. 016 Appendix B: Theory
More informationDynamic Games, II: Bargaining
Dynamic Games, II: Bargaining Econ 400 University of Notre Dame Econ 400 (ND) Dynamic Games, II: Bargaining 1 / 16 Bargaining In bargaining games, we are generally trying to model agents haggling back-and-forth
More informationStrategic Abuse and Accuser Credibility
1 / 33 Strategic Abuse and Accuser Credibility HARRY PEI and BRUNO STRULOVICI Department of Economics, Northwestern University November 16th, 2018 Montréal, Canada 2 / 33 Motivation Many crimes/abuses
More informationProblem Set 6 Solutions
Problem Set 6 Solutions Exercise. Prom Example : (Alex Alice, Bob Betty), College Admission Example: (A (β,γ), B α); (A (α,β), B γ), Prom Example 2: (Alex Alice, Bob Betty); (Alex Betty, Bob Alice). Exercise
More informationThe Firm-Growth Imperative: A Theory of Production and Personnel Management
The Firm-Growth Imperative: A Theory of Production and Personnel Management Rongzhu Ke Hong Kong Baptist University Jin Li London School of Economics Michael Powell Kellogg School of Management Management
More informationInformation, Bargaining Power and Efficiency: Re-examining the Role of Incomplete Information in Crisis Bargaining.
Information, Bargaining Power and Efficiency: Re-examining the Role of Incomplete Information in Crisis Bargaining. Kai Hao Yang 03/13/2017 Abstract In this article, we showed that in general, without
More information6.207/14.15: Networks Lecture 16: Cooperation and Trust in Networks
6.207/14.15: Networks Lecture 16: Cooperation and Trust in Networks Daron Acemoglu and Asu Ozdaglar MIT November 4, 2009 1 Introduction Outline The role of networks in cooperation A model of social norms
More informationOpting Out in a War of Attrition. Abstract
Opting Out in a War of Attrition Mercedes Adamuz Department of Business, Instituto Tecnológico Autónomo de México and Department of Economics, Universitat Autònoma de Barcelona Abstract This paper analyzes
More informationCorrelated Equilibrium in Games with Incomplete Information
Correlated Equilibrium in Games with Incomplete Information Dirk Bergemann and Stephen Morris Econometric Society Summer Meeting June 2012 Robust Predictions Agenda game theoretic predictions are very
More informationVirtual Robust Implementation and Strategic Revealed Preference
and Strategic Revealed Preference Workshop of Mathematical Economics Celebrating the 60th birthday of Aloisio Araujo IMPA Rio de Janeiro December 2006 Denitions "implementation": requires ALL equilibria
More informationModule 8: Multi-Agent Models of Moral Hazard
Module 8: Multi-Agent Models of Moral Hazard Information Economics (Ec 515) George Georgiadis Types of models: 1. No relation among agents. an many agents make contracting easier? 2. Agents shocks are
More informationEcon 101A Problem Set 6 Solutions Due on Monday Dec. 9. No late Problem Sets accepted, sorry!
Econ 0A Problem Set 6 Solutions Due on Monday Dec. 9. No late Problem Sets accepted, sry! This Problem set tests the knowledge that you accumulated mainly in lectures 2 to 26. The problem set is focused
More informationOptimal Insurance of Search Risk
Optimal Insurance of Search Risk Mikhail Golosov Yale University and NBER Pricila Maziero University of Pennsylvania Guido Menzio University of Pennsylvania and NBER November 2011 Introduction Search and
More informationECO421: Communication
ECO421: Communication Marcin P ski February 9, 2018 Plan Introduction Asymmetric information means some players know more than the others. In real life, information can be transmitted A simple model of
More informationAnswer Key for M. A. Economics Entrance Examination 2017 (Main version)
Answer Key for M. A. Economics Entrance Examination 2017 (Main version) July 4, 2017 1. Person A lexicographically prefers good x to good y, i.e., when comparing two bundles of x and y, she strictly prefers
More informationDYNAMIC LIMIT PRICING: ONLINE APPENDIX Flavio Toxvaerd. March 8, 2018
DYNAMIC LIMIT PRICING: ONLINE APPENDIX Flavio Toxvaerd March 8, 2018 Abstract. This appendix o ers a detailed and self-contained analysis of the benchmark single-round version of the dynamic model presented
More informationExtensive Form Games I
Extensive Form Games I Definition of Extensive Form Game a finite game tree X with nodes x X nodes are partially ordered and have a single root (minimal element) terminal nodes are z Z (maximal elements)
More informationDuopoly and Project Uncertainty
Duopoly and Project Uncertainty An analysis of the Bertrand and Cournot duopolies under uncertainty for the buyer Draft Master Thesis Rik Bos Student 345327 June 2016 Erasmus School of Economics Master
More informationDeceptive Advertising with Rational Buyers
Deceptive Advertising with Rational Buyers September 6, 016 ONLINE APPENDIX In this Appendix we present in full additional results and extensions which are only mentioned in the paper. In the exposition
More informationBargaining and Reputation in Search Markets
Review of Economic Studies (204) 8, 29 doi:0.093/restud/rdt02 The Author 203. Published by Oxford University Press on behalf of The Review of Economic Studies Limited. Advance access publication 2 July
More informationImpatience vs. Incentives
Impatience vs. Incentives Marcus Opp John Zhu University of California, Berkeley (Haas) & University of Pennsylvania, Wharton January 2015 Opp, Zhu (UC, Wharton) Impatience vs. Incentives January 2015
More informationJob market signaling with human capital investment
Job market signaling with human capital investment Gea M. Lee and Seung Han Yoo This version: December 3, 2013 Abstract In this paper, we consider the social value of signaling by recasting the Spence
More informationOligopoly. Oligopoly. Xiang Sun. Wuhan University. March 23 April 6, /149
Oligopoly Xiang Sun Wuhan University March 23 April 6, 2016 1/149 Outline 1 Introduction 2 Game theory 3 Oligopoly models 4 Cournot competition Two symmetric firms Two asymmetric firms Many symmetric firms
More informationRule Rationality. February 4, Abstract
Rule Rationality Yuval Heller Eyal Winter February 4, 2015 Abstract We study the strategic advantages of following rules of thumb that bundle different games together (called rule rationality) when this
More informationAn Efficient Solution to the Informed Principal Problem
An Efficient Solution to the Informed Principal Problem Sergei Severinov First version: May 2004, This Version: December 2006 Abstract In this paper I study mechanism design by an informed principal. I
More informationD i (w; p) := H i (w; S(w; p)): (1)
EC0 Microeconomic Principles II Outline Answers. (a) Demand for input i can be written D i (w; p) := H i (w; S(w; p)): () where H i is the conditional demand for input i and S is the supply function. From
More informationA Bayesian Theory of Games: An Analysis of Strategic Interactions with Statistical Decision Theoretic Foundation
Journal of Mathematics and System Science (0 45-55 D DAVID PUBLISHING A Bayesian Theory of Games: An Analysis of Strategic Interactions with Statistical Decision Theoretic Foundation Jimmy Teng School
More informationSignaling to Experts
Signaling to Experts Pablo Kurlat Stanford University Florian Scheuer University of Zurich September 2017 Abstract We study competitive equilibrium in a signaling economy with heterogeneously informed
More informationBounded Rationality in Principal Agent Relationships
Bounded Rationality in Principal Agent Relationships by Mathias Erlei & Heike Schenk Mathes Abstract: We conducted six treatments of a standard moral hazard experiment with hidden action. All treatments
More informationDesign Patent Damages under Sequential Innovation
Design Patent Damages under Sequential Innovation Yongmin Chen and David Sappington University of Colorado and University of Florida February 2016 1 / 32 1. Introduction Patent policy: patent protection
More informationLabor Economics, Lectures 1 and 2: Labor Market Externalities
Labor Economics, 14.661. Lectures 1 and 2: Labor Market Externalities Daron Acemoglu MIT October 25 and 30, 2018 Daron Acemoglu (MIT) Externalities October 25 and 30, 2018 1 / 68 Introduction Introduction
More informationInefficiency and Social Exclusion i Title Formation Game: Experimental Eviden. Citation Games and Economic Behavior, 50(2):
Inefficiency and Social Exclusion i Title Formation Game: Experimental Eviden Author(s) Okada, Akira; Riedl, Arno Citation Games and Economic Behavior, 50(2): Issue 2005-02 Date Type Journal Article Text
More informationWars of Attrition with Budget Constraints
Wars of Attrition with Budget Constraints Gagan Ghosh Bingchao Huangfu Heng Liu October 19, 2017 (PRELIMINARY AND INCOMPLETE: COMMENTS WELCOME) Abstract We study wars of attrition between two bidders who
More information