Department of Economics
2211 Campus Drive
Evanston, IL 60208
Ph.D., Economics, Northwestern University, 2021 (expected)
MA, Economics, Northwestern University, 2017
BA, Economics-Mathematics, Columbia University, 2015
Primary Fields of Specialization
Secondary Fields of Specialization
Public Economics, Industrial Organization
Job Market Paper
Market-Based Mechanisms (PDF)
Decision makers frequently condition their actions on economic outcomes, e.g. asset prices, that they believe convey information about an unknown state. However the decision maker’s action, or expectations thereof, may also influence the economic outcome. In this paper we study the general problem of choosing decision rules mapping outcomes to actions in the presence of such feedback effects. We characterize the set of joint distributions of outcomes, actions, and states that can be implemented as the unique equilibrium by such a decision rule. Moreover, we show that all such equilibria are robust to model misspecification. This characterization of the feasible set greatly simplifies the problem of choosing decision rules. A simple graphical technique allows us to identify qualitative features of optimal policies. We illustrate the power of this approach with an application to corporate bailouts. The results are also useful for characterizing optimal decision rules when the requirement of unique implementation is relaxed.
Other Research Papers
“Screening and Information-Sharing Externalities”
Screening and Information-Sharing Externalities (PDF)
Many ongoing policy debates relate to transparency in negotiations. These include pay transparency among employees and the disclosure of payer-negotiated rates by hospitals. I study a repeated bargaining game with one-sided incomplete information in which a single informed agent (the firm) simultaneously bargains over wages with multiple long-lived parties (workers) in each of two periods. Between the first and second period negotiations, workers may with some probability observe the first-period wages of other workers. There are two main theoretical insights. First, there is a complementary screening effect: the more workers screen in equilibrium the lower the information rents that each will have to pay to the high-type firm. In other words, there is a positive externality of screening that manifests through information rents, in addition to the purely informational externality. Second, firm payoffs will have a certain supermodularity property, which implies that equilibria with screening are “fragile” to worker deviations. I show that these insights have surprising policy implications. For example, penalties for pay discrimination have no impact the behavior of high-type firms. I suggest ways to strengthen anti-discrimination laws in order to overcome this.
“Redistribution Through Tax Relief”
Redistribution Through Tax Relief (PDF)
This paper theoretically and empirically explores simple policy solutions to the entwined issues of high property taxes, geographic income disparities, and inequality in public education prevalent in the United States. By accounting for heterogeneity in incomes and home qualities, I am able to shed new light on classic questions regarding competition in local public goods provision, and make novel policy recommendations. I characterize the equilibrium in a dynamic general equilibrium model of location choice and education investment with a competitive housing market, heterogeneous wealth levels and home qualities, and strategic district governments. When all homes are owner-occupied, I show that competition between strategic districts leads to over-taxation in an attempt to attract wealthier residents. A simple class of policies that cap and/or tax the expenditure of richer districts are Pareto improving, and thus politically feasible. These policies reduce inequality in access to education while increasing expenditure on the most under-funded schools. I discuss the policy implications of the degree of homeownership. Finally, I test the assumptions and implications empirically using a regression discontinuity design and data on property tax referenda in Massachusetts.
Platform-Mediated Competition (PDF)
Cross-group externalities and network effects in two-sided platform markets shape market structure and competition policy, and are the subject of extensive study. Less understood are the within-group externalities that arise when the platform designs many-to-many matchings: the value to agent i of matching with agent j may depend on the set of agents with which j is matched. These effects are present in a wide range of settings in which firms compete for individuals custom or attention. I characterize platform-optimal matchings in a general model of many-to-many matching with within-group externalities. I prove a set of comparative statics results for optimal matchings, and show how these can be used to analyze the welfare effects various changes, including vertical integration by the platform, horizontal mergers between firms on one side of the market, and changes in the platform’s information structure. I then explore market structure and regulation in two in-depth applications. The first is monopolistic competition between firms on a retail platform such as Amazon. The second is a multi-channel video program distributor (MVPD) negotiating transfer fees with television channels and bundling these to sell to individuals.
“Subjective Complexity Under Uncertainty”
Subjective Complexity Under Uncertainty (PDF)
Complexity of the problem of choosing among uncertain acts is a salient feature of many of the environments in which departures from expected utility theory are observed. I propose and axiomatize a model of choice under uncertainty in which the size of the partition with respect to which an act is measurable arises endogenously as a measure of subjective complexity. I derive a representation of incomplete Simple Bounds preferences in which acts that are complex from the perspective of the decision maker are bracketed by simple acts to which they are related by statewise dominance. The key axioms are motivated by a model of learning from limited data. I then consider choice behavior characterized by a “cautious completion” of Simple Bounds preferences, and discuss the relationship between this model and models of ambiguity aversion. I develop general comparative statics results, and explore applications to portfolio choice, contracting, and insurance choice.
“Efficiency in Bargaining with Externalities” (note)
Efficiency in Bargaining with Externalities (PDF)
Consider a principal contracting with multiple agents. The principal engages in simultaneous bilateral negotiations with each agent over an allocation (referred to as the “trade”) and payment. There are externalities to trade; each agent’s payoffs depends on their own trade and that of the other agents. I show that under general assumptions on the bargaining protocol, the payoff of the principal is increasing in the aggregate surplus generated by trade. In particular, this implies that the principal-optimal trade profile is efficient.
“Reverse Bayesianism: A Generalization” with Edi Karni and Marie-Louise Vierø,
Forthcoming in B.E. Journal of Theoretical Economics
Reverse Bayesianism: A Generalization (PDF working paper version)
This paper studies an environment in which a decision maker choosing between acts may initially be unaware of certain consequences. We follow the approach of Karni and Vierø (2013) to modeling increasing awareness, which allows for the decision maker’s state space to expand as she becomes aware of new possible consequences. We generalize the main result in Karni and Vierø (2013) by allowing the discovery of new consequences to nullify some states that were non-null before the discovery. We also provide alternative assumptions which strengthen the predictions of the belief updating model.
Prof. Marciano Siniscalchi (Committee Chair)
Prof. Eddie Dekel
Prof. Alessandro Pavan