Publications

Should a benevolent government provide public goods if it cannot commit?, Economic Inquiry, Vol. 61(3), July 2023, 720-737.

Abstract: I compare two different systems of provision of binary public goods: a centralized system, operated by a benevolent government that has limited commitment power; and a decentralized system, based on voluntary contributions, where agents can communicate but cannot write contracts. I show that any ex-post individually rational allocation that is implementable by the centralized system is also implementable by the decentralized system. This suggests that when the public good provision problem is merely an informational one, as is the case with binary public goods, a decentralized system may perform better.

Optimal assignment mechanisms with imperfect verification (joint with Juan Pereyra), Theoretical Economics, Vol. 18 (2), May 2023, 793-836.

Abstract: Objects of different quality are to be allocated to agents. Agents can receive at most one object, and there are not enough high-quality objects for every agent. The value to the social planner from allocating objects to any given agent depends on that agent's private information. The social planner is unable to use transfers to give incentives for agents to convey their private information. Instead, she is able to imperfectly verify their reports through signals that are positively affiliated with each agent's type. We characterize mechanisms that maximize the social planner's expected payoff. In the optimal mechanism, each agent chooses one of various tracks, which are characterized by two thresholds. If the agent's signal exceeds the upper threshold of the chosen track, the agent receives a high-quality object, if it is in-between the two thresholds, he receives a low-quality object and if it is below the lower threshold, he receives no object.

Modeling competition over multiple variables under limited consumer awareness (joint with Samir Mamadehussene),  The Journal of Industrial Economics, Vol. 71(1), March, 2023, 192-211.

Abstract: When analyzing firm competition over two strategic variables (e.g. quality and price), it is important to decide whether to model it as a one-stage or a two-stage game. Our analysis focuses on markets in which consumers are not aware of all alternatives. We find that, if consumers are sufficiently unaware, both the one-stage and the two-stage equilibria of the game that explicitly models limited awareness are close to the one-stage equilibrium of the standard game, which assumes full awareness. Therefore, markets in which consumers have limited awareness can be studied with standard models, provided that the one-stage game is analyzed.

The value of uncertainty in determining an expert's source of expertise, Games and Economic Behavior, Vol. 136, November 2022, 379-388. 

(The previous version of the paper was called "The social value of fake experts" and can be found here.)

Abstract: Experts who rely heavily on their network of clients to provide good advice tend to suggest instead that their expertise is due to their technical knowledge. I show how doubt over the experts' source of expertise might not only help these experts but also their clients. Furthermore, I show how it is possible for them to sustain such doubt indefinitely even when their clients have rational expectations.

The importance of commitment power in games with imperfect evidence, American Economic Journal: Microeconomics, Vol. 12(4), November 2020, 99-113.

Abstract: The literature initiated by Green and Laffont (1986) studies principal/agent models with hard evidence. Evidence is modeled by assuming that the message set of the agent is type dependent. In this setup, Glazer and Rubinstein (2004,2006) and Sher (2011) show that, when the agent's utility function is type independent, there is no advantage for the principal in having commitment power. This paper shows that this way of modelling evidence implicitly assumes it to be perfectly accurate and that the result that commitment power has no value is not robust to making the evidence imperfect.

A game theoretic analysis of voluntary euthanasia and physician assisted suicide (joint with Rodrigo Harrison), Economic Inquiry, Vol. 58(2), April 2020, 745-763. (online appendix)

Abstract: In countries/states where voluntary euthanasia (VE) or physician assisted suicide (PAS) is legal, the patient’s decision about whether to request VE or PAS heavily relies on the information others provide. We use the tools of microeconomic theory to study how communication between the patient, his family and his physician influences the patient’s decision. We argue that families have considerable power over the patient and that the amount of information that is transmitted from physician to patient might be severely diminished as a result of legalizing VE or PAS. We discuss our main results in the context of the ongoing normative debate over the legalization of VE and PAS.

If we confess our sins, International Economic Review, Vol. 60(3), August 2019, 1389-142.

Abstract: I consider a scenario where a social planner suspects that a crime has been committed. There are many suspects and at most one of them is guilty. I characterize the optimal mechanism for the social planner under two different assumptions with respect to her commitment power: full commitment power and partial commitment power. I find that, in either case, the optimal mechanism is what I call a "confession inducing mechanism", where, before an investigation takes place, each agent has the opportunity to confess to being guilty in exchange for a reduced punishment. I find that these mechanisms do better than the traditional trial mechanism because of information externalities: when an agent credibly confesses his guilt, he reveals everyone else's innocence.

Renegotiation proof mechanism design with imperfect type verification, Theoretical Economics, Vol. 14(3), July 2019, 971-1014.

Abstract: I consider the interaction between an agent and a principal who is unable to commit not to renegotiate. The agent's type only affects the principal's utility. The principal has access to a public signal, correlated with the agent's type, which can be used to (imperfectly) verify the agent's report. I define renegotiation proof mechanisms and characterize the optimal one: there is pooling on top - types above a threshold report to be the largest type, while types below the threshold report truthfully - and no regret on top - the mechanism is sequentially optimal after the agent reports to be the largest type.

Inducing Overconfidence, Economic Inquiry, Vol. 55(1), January 2017, 451-460.

Abstract: In this study, I present a theory which explains how the influence of others may generate overconfidence. The argument is built on the idea that the more help an agent receives when performing a task, the less informative the score on that task will be relative to the agent's ability to perform it. If an agent is confident, he tends to benefit from more cooperation opportunities simply because he is likely to be perceived as being more skilled. As a result, he remains confident because the future signals he will observe will contain very little information regarding his ability. On the contrary, if the agent is not confident, he will receive more informative scores, which will help him learn his true ability faster.