Research: Under the shadows of the Dismal Science
Research: Under the shadows of the Dismal Science
Research Groups
Experimental and Computational Economics, Jaume I University, Castellón de la Plana (Spain): since January 2015
Published Papers
[7] Barrachina, A. and Jiménez-Fernández, E. (2025) The step-level public good aspect of equity crowdfunding: a game-theoretic analysis. Rationality and Society, First published online May 16, 2025.
Abstract: The social significance of crowdfunding has been growing during the last few years and it has become an attractive and common way to finance different kinds of projects. In the particular case of an equity crowdfunding campaign, it implies an interesting social interaction among potential contributors (the “crowd”) since it can be conceptualized as the interaction in the private provision of a step-level public good whose rivalry and excludability are ruled by the equity principle. The present paper adopts this perspective to analyze for the first time the most basic rationale for the dynamics and results of such interaction applying a game-theoretic approach. The model assumes a two-period society in which a sufficiently high number of agents decide how much to contribute to an equity crowdfunding campaign seeking contributions to cover the investment needed by a project. If that target is relatively low, the collective behavior of the “crowd” results in an inefficient equilibrium, creating a reversed-social-dilemma among crowdfunders, the opposite of the social dilemma related to the common free-rider problem in the private provision of regular step-level public goods. If the target is not that low, the social interaction may lead to a multiplicity of equilibria, but in every possible equilibrium the amount collected by the campaign is exactly the needed investment.
[6] Barrachina, A. and Forner-Carreras, T. (2022) Market must be defended: the role of counter-espionage policy in protecting domestic market welfare. Information Economics and Policy, Volume 58, March 2022, 100964 .
Abstract: Governments of advanced economies are extremely concerned about the illicit acquisition of information on critical technologies employed by their industries, and countering this economic espionage is quickly becoming one of their top priorities. The present paper advances the theoretical analysis of the interaction between economic espionage and counter-espionage, and presents a first approximation to an inquiry into the rationale for the influence of market competition in its dynamics. The proposed model assumes a country with a one-market economy open to international trade whose product is supplied by domestic firms. Moreover, successful economic espionage implying market entry of foreign firms would harm domestic welfare. Considering counter-espionage policy as entry barrier and sufficient efficiency in espionage and counter-espionage efforts, the analysis of the benchmark case characterized by no foreign consumer and one foreign firm suggests that demand characteristics play an important role in the complex influence of competition in espionage. Irrespective of this, optimal counter-espionage effort is always positive although negatively affected by competition.
[5] Barrachina, A., Tauman, Y. and Urbano, A. (2021) Entry with two correlated signals: the case of industrial espionage and its positive competitive effects. International Journal of Game Theory 50:1, 241-278.
Abstract: Recent advances in information and communication technologies have increased the incentives for firms to acquire information about rivals. These advances may have major implications for market entry because they make it easier for potential entrants to gather valuable information about, for example, an incumbent’s cost structure. However, little theoretical research has actually analyzed this question. This paper advances the literature by extending a one-sided asymmetric information version of Milgrom and Roberts’ (1982) limit pricing model. Here, the entrant is allowed access to an intelligence system (IS) of a certain precision that generates a noisy signal on the incumbent’s cost structure. The entrant thus decides whether to enter the market based on two signals: the price charged by the incumbent and the signal sent by the IS. Crucially, for intermediate values of IS precision, the set of pooling equilibria with ex-ante profitable market entry is non-empty. Moreover, the probability of ex-ante non-profitable entry is strictly positive. In classical limit pricing models, an entrant never enters in a pooling equilibrium, so this result suggests that the use of an IS may potentially increase competition.
[4] Barrachina, A. and González-Chordá, V. (2020) Error reporting and the performance of nursing management: a game-theoretic study. IMA Journal of Management Mathematics 31:4, 445–468.
Abstract: The interaction between nurses and their managers is a very important factor in nurses’ error reporting behaviour, which is crucial to improving patient safety in healthcare organizations. However, little theoretical work has been undertaken to analyse this interaction. This paper uses a game-theoretic principal–agent framework with asymmetric information to study this interaction. We suppose that the principal (the nurse manager) asks the agent (the nurse) to perform a task with a certain patient. In case a mistake is made while treating the patient, the nurse has to decide whether to report it to the manager, who can observe whether the patient suffered an accident. We consider different manager’s leadership styles and analyse their performance in obtaining error notification from nurses in this framework.
[3] Barrachina, A. (2019) Entry under an information-gathering monopoly. The Manchester School 87:1, 117-134.
Abstract: The effects of information-gathering activities on an entry model with asymmetric information are analysed. The baseline game is a classical entry game where an incumbent monopoly faces potential entry by a firm without knowing for certain whether this potential entrant is weak or strong. If the entrant decides to enter, the incumbent must compete with him and decide whether to accommodate or to fight. The paper extends this entry game and considers that the monopoly credibly informs the entrant that she is able to gather information about his type if he finally enters the market, thereby helping her to better decide whether to accommodate or fight. Since knowing this might reduce the entrant’s willingness to compete with her, we focus the analysis on the effectiveness of this monopoly’s communicative action as an entry deterrence strategy. The results suggest that such an action is effective regardless of the precision of the Intelligence System (IS) only for a relatively low payoff gained by the entrant from competing with the incumbent. For higher payoffs for the entrant, the effectiveness of this action requires a considerably accurate IS.
[2] Barrachina, A., Tauman, Y. and Urbano, A. (2014) Entry and espionage with noisy signals. Games and Economic Behavior 83, 127-146.
Abstract: We analyze the effect of industrial espionage on entry deterrence. We consider a monopoly incumbent who may expand capacity to deter entry, and a potential entrant who owns an Intelligence System. The Intelligence System (IS) generates a noisy signal based on the incumbent’s actions. The potential entrant uses this signal to decide whether or not to enter the market. The incumbent may signal-jam to manipulate the likelihood of the noisy signals and hence affect the entrant’s decisions. If the precision of the IS is commonly known, the incumbent benefits from his rival’s espionage. Actually, he benefits more the higher is the precision of the IS while the spying entrant is worse off with an IS of relatively high quality. When the IS quality is private information of the entrant, the incumbent is better off with an IS of high expected precision while the entrant benefits from one of high quality. In this case espionage makes the market more competitive.
[1] Barrachina, A., Rubio, G. and Urbano, A. (2012) Multiplicity in financial equilibrium with portfolio constrains under the generalized logarithmic utility model. The Spanish Review of Financial Economics 10:2, 41-52.
Abstract: Previous research on the effects of constraints to take unbounded positions in risky financial assets shows that, under the logarithmic utility function, multiplicity of equilibrium may emerge. This paper shows that this result is robust to either constant, decreasing or increasing relative risk aversion obtained under the generalized logarithmic utility function.
Conference Proceedings
[In Spanish] Acercando la realidad al aula de Microeconomía a través de la charla de un experto [Bringing reality to Microeconomcs classroom through the talk of an expert]. Proceedings of the Conference "VI Jornada Nacional sobre estudios universitarios. II Taller de innovación educativa. Competencias: formación y evaluación" (pages 578-588), November 9-10, 2017 (ISBN 978-84-16546-80-0).
[In Spanish] Desarrollo de una plataforma online para una docencia en microeconomía basada en experimentos [Development of an online platform for experimental teaching in Microeconomics]. Proceedings of the Virtual Conference "Avances en tecnologías, innovación y desafíos de la educación superior (ATIDES)" (pages 207-216), October 1-15, 2016 (ISBN 978-84-16356-99-7).
Working Papers
[1] Barrachina, A. and Jiménez-Fernández, E. (2025) A discussion of the model-based theoretical analyses of the voluntary private and purely binary provision of a discrete public good (see file "Barrachina and Jiménez-Fernández (2025).pdf" below) [submitted]
Abstract: The social interaction in the private provision (in the sense of voluntary contributions mechanism) of a discrete public good is an important topic of analysis in the public good model-based theoretical literature. The present discussion represents a step forward in the limited existing review of such huge literature discussing the analyses focused on the purely binary nature of such provision (without excluding cases of discrete public goods with some special feature) and considering the sys- tem of rules as exogenous. The study reveals fragmentation in the literature and synthesizes such heterogeneity into a baseline model highlighting key directions for future research.
Work in Progress
Barrachina, A. "Trusting audited financial statements under incomplete information: the role of external perceptions of auditor's independence"
Barrachina, A. and Ruiz-Buforn, A. "Self-restraint as an online entry-deterrence strategy under showrooming"