Estimating Multi-Product Production Functions: What Can We Learn Without Demand Assumptions? [paper]
Abstract: I prove that, when the demand side is unrestricted, production functions for multi-product firms are unidentified, except in population if the conditional time- series variance of inputs is unbounded. I develop a novel identification strategy that does not rely on demand-side assumptions. Instead, by imposing the weaker assumption that the productivity distribution is in a stationary equilibrium, I show that the production function parameters are set-identified. Using simulations, I show that the estimator is robust to non-stationarity of the productivity processes in short panels and provide evidence that the identified set is highly informative about the data-generating parameters. My approach avoids the need for instruments or numerical solvers, providing a widely applicable method for estimation.
Non-Separable Joint Cost Functions and Returns to Scope: Identification and Testing [paper]
Abstract: Understanding economies of scope is central to merger analysis and the regulation of natural monopolies, yet existing tools cannot account for imperfect input markets and within-firm productivity heterogeneity. This paper relaxes both. I derive a corrected testable condition for non-jointness in residual cost functions and extend it to production frontiers. I then demonstrate that ignoring pre-determined inputs causes researchers to underestimate returns to scale while leaving returns to scope consistently identified. Finally, I establish non-parametric point identification of the joint cost function when firm-product-time-specific Hicks-neutral productivities follow an AR(1) process, showing that standard GMM moments recover the cost function without imposing separability or functional form restrictions on the technology.
Partition Dependent Expected Utility (joint with Agustin Troccoli-Moretti) [paper]
Abstract: In this paper, we study choice under objective risk where the primitive is enriched to include an exogenous equivalence relation on the space of lotteries. We seek conditions on this enlarged primitive ensuring the existence of an expected utility representation in which the Bernoulli utility index may depend on the partition generated by the equivalence relation. We term this model the Partition Dependent Expected Utility (PDEU) and show examples of recent choice models in the literature on non-expected utility that fall into this class. We prove representation theorems characterizing PDEU preferences when the partition generates convex cells, and under different continuity assumptions. Our theorems address partitions with both countable and uncountable elements, with cells that can be lower-dimensional, fully dimensional, or a combination of both. We show that for fully dimensional cells, the parameters of the representation are suitably unique, but this is not the case for lower-dimensional cells. We conclude with a discussion of the technical challenges that may arise when studying partitions with non-convex cells.
State of UK Competition Report 2024 (joint with Amanda Ereyi, Fizza Jabbar, Joel Kariel, Luke McWatters, Rajssa Mechelli, Max Read, and Jakob Schneebacher) CMA Microeconomics Unit Report, 2024.
Competition and Market Power in UK Labour Markets (joint with Joel Kariel, Renisha Rana, Max Read, Ana Rincon Aznar, and Jakob Schneebacher) CMA Microeconomics Unit Report, 2024.