Research

Working Papers

Competition, Prices and Markups: the Newly Deregulated Retail Gasoline Market in Mexico (with Benjamín Contreras,  Jordán Mosqueda, and Alejandrina Salcedo). September 2020. Media and policy mentions: Universal, Cofece.

Trade Policy Uncertainty and NAFTA (with Román Acosta). January 2023. 

The Value of Transparency (with Teddy Mekonnen). August 2022.

Household Gas Competition: Market Power and Inequality in Mexico (with Benjamín Contreras). January 2022.

Identifying and Estimating the Value of Product Variety Using Instrumental Variables (with Kory Kroft, Jean-William Laliberté, and Matt Notowidigdo). July 2020.

Working Papers 2

“Entry and the Value of Information in Auctions”

Abstract: In most of the auctions literature, the model assumes a fixed number of bidders with a fixed information structure. This modeling choice is unrealistic and carries strong implications: For example, participation is always valuable for the seller through increased competition and potential efficiency gains. However, an auction format that raises more revenue for a fixed number of bidders also induces less participation. An auctioneer that takes this effect into account will trade off some of the rent extraction to induce more participation.

One contribution of the paper is to show that a similar tradeoff is present when bidders choose the intensity with which they gather information. In fact, I show that the auctions that induce more information acquisition are also those that give more value to the bidders. Therefore, the auctioneer also needs to balance this tradeoff.

In terms of the theory, a basic problem is that we only know how to rank the value of information for two different auction formats when the number of bidders is fixed. I solve this problem by developing the tools to rank the value of information when participation is endogenously determined. The tools include introducing new orders in the space of bidder’s utility functions and the space of information structures. A notable implication is that (in common value auctions), for a class of ordered signals, the first price auction induces more entry and more information acquisition than a second price auction, but the second price auction raises more revenue.

Several new results are provided for auctions with interdependent values and security-bid auctions where contingent payments are allowed.

“Acquisition and Disclosure of Information to a Monopoly”. July 2016.

Abstract: I characterize the jointly optimal information acquisition and disclosure policies in a buyer-seller game where acquiring information is costly. When a new product is introduced by a monopolist, an uninformed buyer can incur a cost to get a signal of her valuation from a family of available signals. At the point where the information acquisition strategy is chosen the buyer can also commit to disclose information: any signal weakly less informative than the one acquired can be transmitted to the seller. For any given information acquisition strategy, disclosure can increase informational rents to the buyer, therefore she must take into account the optimal disclosure policy for each signal to compute the real value of information. I introduce continuous and connected families of information acquisition strategies and cost, and I characterize the jointly optimal choice of the buyer. In the particular case when information acquisition is unrestricted: all signals are available to the buyer; and the cost function is increasing in informativeness, the optimal policy involves no disclosure of information to the monopolist.