University of Mannheim Department of Economics
L7, 3-5 (3rd floor, Office 3-13) 68131 Mannheim (Germany)
tel: +49 621 181-1838
Consumers' Costly Responses to Product-Harm Crises (joint with Rosa Ferrer), Management Science - forthcoming
Demand for nondurable goods: a shortcut to long-run demand elasticities, Rand Journal of Economics, 2017, 48: 856-873.
Gender Bias in Intrahousehold Allocation: Evidence from an Unintentional Experiment, joint with Luis B. Braido and Pedro Olinto, Review of Economics and Statistics 2012, 94: 552-565
We show evidence of downstream moral hazard in a unique setting where regulation limits the use of vertical restraints that could alleviate the conflict of interest between manufacturers and retailers. Using data on cigarette vending machines, we find empirical evidence consistent with retailers making strategic product re-stocking decisions. That is, they make less re-stocking effort for low-margin products, prompting consumers to substitute towards high-margin products. We exploit variation in product assortment as a source of identification to recover preference parameters in a setting where prices vary infrequently. Estimated diversion ratios are high across products within the same vending machine and low towards outside retailers. We also recover manufacturers' marginal costs. Counterfactuals exercises based on our model parameter estimates measure the welfare effects of moral hazard for consumers and manufacturers. Welfare losses are economically relevant on average, however some manufactures are better off when there are strategic stockouts.
Price dispersion and informational frictions: evidence from supermarket purchases (with Pierre Dubois) revise and resubmit - American Economic Journal - Microeconomics
Traditional demand models assume that consumers are perfectly informed about product characteristics, including price. However, this assumption may be too strong. Unannounced sales are a common supermarket practice. As we show, retailers frequently change position in the price rankings, thus making it unlikely that consumers are aware of all deals offered in each period. Further empirical evidence on consumer behavior is also consistent with a model with price information frictions. We develop such a model for horizontally differentiated products and structurally estimate the search cost distribution. The results show that in equilibrium, consumers observe a very limited number of prices before making a purchase decision, which implies that imperfect information is indeed important and that local market power is potentially high. We also show that a full information demand model yields severely biased price elasticities.
We investigate whether penalizing wrong answers on multiple-choice tests (``negative marking'') makes females relatively worse off compared to males (the comparison being no penalties for wrong answers). With a cohort of more than 500 undergraduate students at a major Spanish university, we conducted a field experiment in the Microeconomics course. We created a final exam, which was composed of two parts: one with penalties for wrong answers and one without. Students were randomly allocated to different exam permutations, which differed in the questions that carried penalties for wrong answers. We find that the penalties did not harm female students. Females performed better than males on both parts of the exam and did so to a greater extent on the part with penalties. Whereas risk aversion did not affect overall scores (despite affecting answering behavior), ability did. High-ability students performed relatively better with negative marking, and these were more likely to be women.
Work in progress
The Competitive Effects of Subprime Credit for Consumption
Using data from Brazil, I study the effect of entry of large subprime lenders in markets where the population was previously credit constrained on: (i) consumers’ purchase patterns; (ii) consumers’ welfare measures; and (iii) the local competitive environment.
The market for cigarettes and demand estimation when there are stockouts
Using Spanish cigarette vending machine, we develop a demand model that allows for stockouts, a common feature in many markets and that, if ignored, could lead to biased price elasticity measure if ignored. The modell uses stockouts as an additional source of variation for identification, which is especially relevant for estimation of demand for products which experience infrequent price changes. We use data on spanish cigarette vending machines, which includes not only information on stockouts but also the number of lost sales per product due to a stockouts event. We estimate the preference parameters of consumers' and use them to derive health policy implications.