Working Papers 

Nonparametric Estimation of Sponsored Search Auctions and Impacts of Ad Quality on Search Revenue  Cemmap working paper CWP05/23, CESifo Working Paper No. 10312 

with Dongwoo Kim, (Simon Fraser University)

• This paper presents an empirical model of sponsored search auctions in which advertisers are ranked by bid and ad quality. We introduce a new nonparametric estimator for the advertiser's ad value and its distribution under the incomplete information assumption. The ad value is characterized by a tractable analytical solution given observed auction parameters. Using Yahoo! search auction data, we estimate value distributions and study the bidding behavior across product categories. We also conduct counterfactual analysis to evaluate the impact of score squashing  (ad quality raised to power less than 1) on the auctioneer's revenue. Our results show that product-specific score squashing can enhance auctioneer revenue at the expense of advertiser profit and consumer welfare.

Estimation of Bidder's Latent Value in Sequential English Auctions with Uncertainty in Future Supply, working paper draft

with Kyoo il Kim (Michigan State University) and Haoyang Li (SHUFE)

This paper proposes a new method to identify and estimate the bidder's latent value in sequential English auctions, with an independent private value paradigm. We show that partial identification of latent value distribution is possible with minimal assumption without imposing equilibrium strategies. We further show how the method can be applied in previously unexplored auction market conditions such as the case of uncertainty about the number of auctions held in the future. We apply the method to data from used car auctions.  

Dynamic Game with Multidimensional Type: The Case of Carbon-Credit Market CESifo Working Paper No. 9978

with Thomas D. Jeitschko (Michigan State University)

• We propose a method to curb price volatility in the presence of changing expected future demand. The equilibrium analysis shows that modifying the cap on per period supply can decrease price fluctuations.  This paper suggests that a flexible cap on the per period supply would be a better alternative to fixed cap. Furthermore, simulation data shows that the optimal flexible cap should decrease supply at a higher rate than the rate of change in expected future demand.

Quality Differentiation and Optimal Pricing Strategy in Multi-sided Markets  CESifo Working Paper No. 9267 

with Soo Jin Kim (Bank of Canada) 

• This paper analyzes the generalized quality differentiation model in multi-sided markets with positive externalities, which leads to new insights into the optimal pricing structure of the firm. We find that quality differentiation for users on one side affects not only the side involving differentiation but also the other side due to cross-side network externalities, thereby affecting the pricing structure of multi-sided firms. In addition, quality differentiation affects the strategic relationships among all the choice variables for the platform, so that the platform strategically uses quality differentiation to raise its profits

Work in Progress  

• Impact of UberEats' Acquisition of Postmates on Consumer Welfare.

• Revenue-Maximizing number of auto-bidders in the presence of display externality

• Differential Impact of Ad Auction Design Across Platforms, 

       with Anjana Sursarla