PhD Candidate, Department of Economics

jmweb

Contact Information

Department of Economics
Northwestern University
2001 Sheridan Road
Evanston, IL 60208

Phone: 773-816-2978
Teddy.Mekonnen@u.northwestern.edu
Education

 

Ph.D., Economics, Northwestern University, 2017 (expected)
MA, Economics, Northwestern University, 2012
BA, Economics, Washington University in St. Louis, 2011

Primary Fields of Specialization

Microeconomic Theory

Curriculum Vitae

Download Vita

Job Market Paper

“Ex-ante Comparative Statics: Responsiveness to Information Quality” with René Leal Vizcaíno, Download Job Market Paper

An agent chooses an action after acquiring information about an uncertain state. From an ex-ante perspective, the agent’s optimal action is an endogenously determined random variable. We study how the quality of information affects the responsiveness of the optimal actions, a concept of dispersion that encompasses mean-preserving spreads and second-order stochastic dominance relations. The higher the quality of information, the more closely the agent tailors her actions to the state, and consequently, under conditions we derive on payoffs the more responsive the optimal action. We then extend our comparative statics results to Bayesian games with complementarities where the information quality of several players might vary. Finally, we illustrate the use of responsiveness to characterize the value of transparency in Bayesian games with one sided information acquisition by comparing the value of information in the covert and the overt information acquisition games.

Other Research Papers:

“Short Term Contracting with an Informed Principal”, work in progress, Extended Abstract

I study a moral hazard problem between an agent and an informed principal who can only make within period commitments. Output is correlated to both the agent’s hidden action and the principal’s hidden type. In a setting with binary types for the principal and a risk-neutral agent with limited liability, I characterize the optimal short term mechanism that induces the agent to work in each period. The optimal mechanism must balance the trade-off between a separating contract that requires costly signaling by the high type and pooling contracts that allow the agent to earn rents by manipulating the principal’s second order beliefs (the principal’s beliefs about what the agent believes is the principal’s type). In a static model, the latter effect is absent and optimal mechanisms either fully separate or fully pool. In a dynamic setting, the optimal mechanism may feature randomization with the high type probabilistically pooling with the low type.

“Dynamic Moral Hazard and the Rate of Learning”, work in progress, Extended Abstract

I study a continuous time principal-agent problem in which both learn about the quality of the production technology from observing output. Any deviation in effort by the agent creates a disparity between what the agent and what the principal knows. Furthermore, when the technology exhibits complementarities between effort and quality, deviations also affect the speed at which the agent learns, an effect that is suppressed in the linear production technologies studied previously in the literature. I take a stochastic maximum principle approach to solve the agent’s problem and show that the principal must give the agent a new type of information rents to control the speed of learning.

Teaching

Microeconomics, Political Economics, Game Theory, Industrial Organization
Teaching Evaluations

References

Prof. Asher Wolinsky (Committee Chair)
Prof. Eddie Dekel
Prof. Bruno Strulovici