Publications:
1. "Monotone Equilibria in Signalling Games," with Harry Pei, European Economic Review, vol.124, 103408/pp. 1-16, 2020.
2. "Delegating Performance Evaluation," with Igor Letina and Nick Netzer, Theoretical Economics, vol. 15, pp. 477-509, 2020.
3. "Targeted Information and Limited Attention," with Andreas Hefti, RAND Journal of Economics, vol. 51, pp. 402-420, 2020.
4. "On Linear Transformations of Intersections," with Alexey Kushnir, Set-Valued and Variational Analysis, vol. 28, pp. 475-489, 2020.
5. "Voting with Public Information," Games and Economic Behavior, vol. 113, pp. 694-719, 2019.
6. "On the Equivalence of Bayesian and Dominant Strategy Implementation for Environments with Non-Linear Utilities,"
with Alexey Kushnir, Economic Theory, vol. 67, pp. 617-644, 2019.
Working Papers:
1. "Happy Times: Identification from Ordered Response Data," with Nick Netzer, June 2021.
- Revise & Resubmit at the American Economic Review.
Abstract: Surveys that designed to measure subjective states (e.g., happiness) typically generate ordinal data. A fundamental problem is that methods used to analyse ordinal data (e.g., ordered probit) rely on strong and often unjustified distributional assumptions. In this paper, we propose using survey response times to solve that problem. The key assumption of our approach is that individual response time is decreasing in the distance between the value of the latent variable and an indecision threshold. This assumption is supported by a large body of evidence on chronometric effects in psychology, neuroscience and economics. We provide conditions under which the expected value of the latent variable (e.g., average happiness) can be compared across groups, even without making distributional assumptions. We apply our method to an online survey experiment and obtain some evidence that happiness follows distributions for which traditional regression analysis is valid.
2. "Talent Poaching and Job Rotation," with Diego Battiston and Miguel Espinosa, January 2021.
Abstract: Firms allocate workers to clients to provide services. On the job, workers acquire skills that increase their client-specific productivity and therefore raise the probability that clients poach them. In this paper, we advance the understanding of this important, yet understudied feature of service industries. We show, both theoretically and empirically, that in order to mitigate poaching risk firms may forgo potential productivity gains by moving workers from one client to the other. Focusing on a security service-industry firm in Colombia, we find that an increase in client-specific experience increases both workers' productivity and probability that the workers are poached. After a policy change that forbids talent poaching, the firm sharply decreased the frequency of rotation, especially for workers who were more likely to be poached before the policy change. The theoretical model we propose is consistent with these empirical patterns and substantiates the broad applicability of the studied mechanism.
3. "Optimal Contest Design: A General Approach," with Igor Letina and Nick Netzer, May 2020.
- Revise & Resubmit at the Journal of Economic Theory.
Abstract: We consider the design of contests for n agents when the principal can choose both the prize profile and the contest success function. Our framework includes Tullock contests, Lazear-Rosen tournaments and all-pay contests as special cases, among others. We show that the optimal contest has an intermediate degree of competitiveness in the contest success function, and a minimally competitive prize profile with n−1 identical prizes. The optimum can be achieved with a nested Tullock contest. We extend the model to allow for imperfect performance measurement and for heterogeneous agents. We relate our results to a recent literature which has asked similar questions but has typically focused on the design of either the prize profile or the contest success function.
4. "Preference, Confusion and Competition," with Andreas Hefti and Armin Schmutzler, July 2021.
- Revise & Resubmit at The Economic Journal.
Abstract: Existing literature has argued that firms benefit from confusing consumers of homogenous goods. This paper shows that this insight generally breaks down with differentiated goods and heterogeneous preferences: With polarized taste distributions, firms fully educate consumers. In cases where firms nevertheless confuse consumers, the welfare consequences are worse than for homogenous goods, as consumers choose dominated options. Similar insights are also obtained for political contests, in which candidates compete for voters with heterogenous preferences: Parties choose ambiguous platforms only when preferences are "Indecisive", featuring a concentration of indifferent voters.
5. "Designing Organizations in Volatile Markets," with Dimitri Migrow, February 2021.
- Revise & Resubmit at the Journal of Economic Theory.
Abstract: Multinational and multiproduct firms often experience uncertainty in the relative return of conducting activities in different markets due to, for example, exchange rate volatility or the changing prospects of different products. We study how a multi-divisional organization should optimally allocate decision-making authority to its managerial members when operating in such volatile markets. To be able to adapt its decisions to local conditions, the organization has to rely on self-interested division managers to collect and disseminate the relevant information. We show that if communication takes the form of verifiable disclosure, then centralized decision-making does not suffer from information asymmetry and it allows the headquarter of the organization to better cope with the inter-market uncertainty. However, also due to the inter-market uncertainty, centralization can perform poorly in motivating information acquisition, and particularly so when it is highly important to coordinate the activities of different divisions. As a result, decentralization can be optimal even with an arbitrarily strong coordination motive.
1. "Monotone Equilibria in Signalling Games," with Harry Pei, European Economic Review, vol.124, 103408/pp. 1-16, 2020.
2. "Delegating Performance Evaluation," with Igor Letina and Nick Netzer, Theoretical Economics, vol. 15, pp. 477-509, 2020.
3. "Targeted Information and Limited Attention," with Andreas Hefti, RAND Journal of Economics, vol. 51, pp. 402-420, 2020.
4. "On Linear Transformations of Intersections," with Alexey Kushnir, Set-Valued and Variational Analysis, vol. 28, pp. 475-489, 2020.
5. "Voting with Public Information," Games and Economic Behavior, vol. 113, pp. 694-719, 2019.
6. "On the Equivalence of Bayesian and Dominant Strategy Implementation for Environments with Non-Linear Utilities,"
with Alexey Kushnir, Economic Theory, vol. 67, pp. 617-644, 2019.
Working Papers:
1. "Happy Times: Identification from Ordered Response Data," with Nick Netzer, June 2021.
- Revise & Resubmit at the American Economic Review.
Abstract: Surveys that designed to measure subjective states (e.g., happiness) typically generate ordinal data. A fundamental problem is that methods used to analyse ordinal data (e.g., ordered probit) rely on strong and often unjustified distributional assumptions. In this paper, we propose using survey response times to solve that problem. The key assumption of our approach is that individual response time is decreasing in the distance between the value of the latent variable and an indecision threshold. This assumption is supported by a large body of evidence on chronometric effects in psychology, neuroscience and economics. We provide conditions under which the expected value of the latent variable (e.g., average happiness) can be compared across groups, even without making distributional assumptions. We apply our method to an online survey experiment and obtain some evidence that happiness follows distributions for which traditional regression analysis is valid.
2. "Talent Poaching and Job Rotation," with Diego Battiston and Miguel Espinosa, January 2021.
Abstract: Firms allocate workers to clients to provide services. On the job, workers acquire skills that increase their client-specific productivity and therefore raise the probability that clients poach them. In this paper, we advance the understanding of this important, yet understudied feature of service industries. We show, both theoretically and empirically, that in order to mitigate poaching risk firms may forgo potential productivity gains by moving workers from one client to the other. Focusing on a security service-industry firm in Colombia, we find that an increase in client-specific experience increases both workers' productivity and probability that the workers are poached. After a policy change that forbids talent poaching, the firm sharply decreased the frequency of rotation, especially for workers who were more likely to be poached before the policy change. The theoretical model we propose is consistent with these empirical patterns and substantiates the broad applicability of the studied mechanism.
3. "Optimal Contest Design: A General Approach," with Igor Letina and Nick Netzer, May 2020.
- Revise & Resubmit at the Journal of Economic Theory.
Abstract: We consider the design of contests for n agents when the principal can choose both the prize profile and the contest success function. Our framework includes Tullock contests, Lazear-Rosen tournaments and all-pay contests as special cases, among others. We show that the optimal contest has an intermediate degree of competitiveness in the contest success function, and a minimally competitive prize profile with n−1 identical prizes. The optimum can be achieved with a nested Tullock contest. We extend the model to allow for imperfect performance measurement and for heterogeneous agents. We relate our results to a recent literature which has asked similar questions but has typically focused on the design of either the prize profile or the contest success function.
4. "Preference, Confusion and Competition," with Andreas Hefti and Armin Schmutzler, July 2021.
- Revise & Resubmit at The Economic Journal.
Abstract: Existing literature has argued that firms benefit from confusing consumers of homogenous goods. This paper shows that this insight generally breaks down with differentiated goods and heterogeneous preferences: With polarized taste distributions, firms fully educate consumers. In cases where firms nevertheless confuse consumers, the welfare consequences are worse than for homogenous goods, as consumers choose dominated options. Similar insights are also obtained for political contests, in which candidates compete for voters with heterogenous preferences: Parties choose ambiguous platforms only when preferences are "Indecisive", featuring a concentration of indifferent voters.
5. "Designing Organizations in Volatile Markets," with Dimitri Migrow, February 2021.
- Revise & Resubmit at the Journal of Economic Theory.
Abstract: Multinational and multiproduct firms often experience uncertainty in the relative return of conducting activities in different markets due to, for example, exchange rate volatility or the changing prospects of different products. We study how a multi-divisional organization should optimally allocate decision-making authority to its managerial members when operating in such volatile markets. To be able to adapt its decisions to local conditions, the organization has to rely on self-interested division managers to collect and disseminate the relevant information. We show that if communication takes the form of verifiable disclosure, then centralized decision-making does not suffer from information asymmetry and it allows the headquarter of the organization to better cope with the inter-market uncertainty. However, also due to the inter-market uncertainty, centralization can perform poorly in motivating information acquisition, and particularly so when it is highly important to coordinate the activities of different divisions. As a result, decentralization can be optimal even with an arbitrarily strong coordination motive.
Research Notes:
1. "A Note on Jackson and Yariv (2017)," October 2017.
2. "A Note on Lavi, Mu'alem and Nisan (2009)," with Alexey Kushnir, April 2014.
1. "A Note on Jackson and Yariv (2017)," October 2017.
2. "A Note on Lavi, Mu'alem and Nisan (2009)," with Alexey Kushnir, April 2014.
