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Queen Mary, University of London Price Taking Equilibrium in Club Economies with Multiple Memberships and Unbounded Club Sizes
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Columbia University A Simple Scheme to Improve the Efficiency of Referenda
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Vanderbilt University Endogenous Games and Equilibrium Adaptation of Social Norms and Ethical Constraints (joint work with William Neilson) Abstract We depart from the usual assumption in noncooperative game theory that games arise exogenously. We assume instead that games between agents are formed endogenously in the sense that agents choose their opponents through a costly search process. Since agents are aware in this situation that both parties have the option of rejecting a match, they have an incentive to make themselves as attractive a partner as they can. This is accomplished in a pregame in which agents consider all the potential strategies in a game but choose to learn only a subset. We assume that this choice is observable by their potential partners in the matching game. We motivate this as a proxy for subscribing to a code of ethics, accepting a set of social norms, or being a member of religious, philosophical or political group. We show that agents will sometimes choose to constrain their action sets in the pregame in order to achieve better matches and higher payoffs. We suggest that this might provide at least a partial explanation for experimental observations that agents apparently choose strategies that do not maximize their payoffs. |
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Università Ca' Foscari di Venezia Information Sharing Networks
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Universidade Nova de Lisboa A Strategic Model of Club Formation; Existence and Characterization of Equilibrium
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Pennsylvania State University Efficiency in Coalition Games with Externalities [pdf] Abstract A natural extension of superadditivity is not sufficient to imply that the grand coalition is efficient when externalities are present. We provide a condition –analogous to convexity –that is sufficient for the grand coalition to be efficient and show that this also implies that the (appropriately defined) core is nonempty. Moreover, we propose a mechanism which implements the most efficient partition for all coalition formation games and characterize the payoff division of the mechanism. |
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Boston College Tiebout's Tale in Spatial Economies: Entrepreneurship, Self-Selection and Efficiency [pdf] Abstract This paper proposes an equilibrium concept based on Rothschild and Stiglitz (1977 QJE) in local public goods economy a la Tiebout (1956 JPE) with spatial elements. Land, location-specific production technology, and wage differences are introduced, and taxes are land taxes (property taxes). Assuming small group effectiveness in the manner of Wooders (1978), Kaneko and Wooders (1986 MASS), Ellickson et al (1999 Econometrica) and Conley and Wooders (1997 mimeo), we show the existence and efficiency of equilibrium. The key requirement is anonymity of land tax, which is attained by imposing Hamilton's (1975 Urban Studies) zoning constraints (otherwise, no equilibrium based on the logic of Rothschild and Stiglitz). Wage differential across locations are allowed, yet we can assure efficiency of equilibrium in our particular economy despite of intuitions by Tiebout (1956 JPE), Buchanan and Wagner (1970 essay) and Flatters, Henderson and Mieszkowski (1974 JPubE). Lastly, our theorem can be directly applicable to the existence and efficiency of a monocentric city equilibrium in urban economics with commuting time costs even if we allow existence of collective residences such as apartments. |
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University of Pennsylvania Smooth Monotone Contribution Games [pdf] Abstract A monotone game is a multistage game in which no player can lower her action in any period below its previous level. A motivation for the monotone games of this paper is dynamic voluntary contribution to a public project. Each player's utility is a strictly concave function of the public good, and quasilinear in the private good. The main result is a description of the limit points of (subgame perfect) equilibrium paths as the period length shrinks. The limiting set of such profiles is equal to the undercore of the underlying static game -- the set of profiles that cannot be blocked by a coalition using a smaller profile. A corollary is that the limiting set of achievable profiles does not depend on whether the players can move simultaneously or only in a round-robin fashion. The familiar core is the efficient subset of the undercore; hence, some but not all profiles that are efficient and individually rational can be nearly achieved when the period length is small. As the period length shrinks, any core profile can be achieved in a "twinkling of the eye" -- neither real-time gradualism nor inefficiency are necessary. |
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University of Exeter Announcements or Contribution? The Relative Efficiency of Manipulated Lindahl Mechanisms [pdf] (joint work with Nigar Hashimzade) Abstract The private provision mechanism is individually incentive compatible but inefficient. The Lindahl mechanism is efficient but not incentive compatible. We contrast the outcome of the manipulated Lindahl mechanism to the private provision equilibrium. When the demand announcements of participants are unrestricted the Lindahl mechanism suffers from multiple equilibria. If the government removes the multiplicity by restricting the functional form of announcements the resulting Lindahl equilibrium can be made approximately efficient. Approximate efficiency is achieved by announcements that are one-dimensional regardless of the number of participants in the mechanism. This is in contrast to mechanisms that achieve exact efficiency but require announcements whose dimensionality increases at the same rate as the number of participants. The mechanism we describe benefits from simplicity at the cost of approximate efficiency. |
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University of Pennsylvania Public Goods, Redistribution, and Constitutional Design (joint work with A. Lizzeri) Abstract The talk is an overview of part of my research agenda in political economy and covers a number of papers, two of which can be downloaded from my webpage. The two papers are: "The Drawbacks of Electoral Competition," and "Why did the Elites Extend the Franchise?" |
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McGill University Negotiation and Efficiency
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