Working Papers

These papers are working drafts of research which often appear in final form in academic journals. The published versions may differ from the working versions provided here.

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Paulo Somaini
July 9, 2019

This paper provides a positive identification result for first-price procurement models with asymmetric bidders, statistically dependent private signals,
and interdependent costs. When bidders are risk neutral, the model’s payoff-relevant primitives are: (i) the joint...

David M. Kreps, Walter Schachermayer
July 2019

We examine Kreps’ (2019) conjecture that optimal expected utility in the classic Black–Scholes–Merton (BSM) economy is the limit of optimal expected utility for a sequence of discrete-time economies that “approach” the BSM economy in a natural...

David M. Kreps, Walter Schachermayer
June 2019

We prove a fundamental result concerning the connection between discrete-time models of financial markets and the celebrated Black–Scholes–Merton continuous-time model in which “markets are complete.” Specifically, we prove that if (a) the probability law of a...

Rob Donnelly, Francisco R, Ruiz, David Blei, Susan Athey
June 2019

This paper proposes a method for estimating consumer preferences among discrete choices, where the consumer chooses at most one product in a category, but selects from multiple categories in parallel. The consumer’s utility is additive...

Susan Athey, Guido W. Imbens
March 24, 2019

We discuss the relevance of the recent Machine Learning (ML) literature for economics and econometrics. First we discuss the differences in goals, methods and settings between the ML literature and the traditional econometrics and statistics...

Dmitry Arkhangelsky, Susan Athey, David A. Hirshberg, Guido W. Imbens, Stefan Wager
February 1, 2019

We present a new perspective on the Synthetic Control (SC) method as a weighted least squares regression estimator with time fixed effects and unit weights. This perspective suggests a generalization with two way (both unit...

Susan Athey, Billy Ferguson, Mathew Gentzkow, Tobias Schmidt
February 2019

We introduce a novel measure of segregation, experienced isolation, that captures individuals’ exposure to diverse others in the places they visit over the course of their days. Using novel Global Positioning System (GPS) data collected...

Nikhil Agarwal, Itai Ashlagi, Michael Rees, Paulo Somaini, Daniel Waldinger
January 27, 2019

A transplant can improve a patient’s life while saving several hundreds of thousands of dollars in healthcare expenditures. Organs from deceased donors, like many other scarce public resources (e.g. public housing, child-care, publicly funded long-term...

Zhiyao Chen, Dirk Hackbarth, Ilya A. Strebulaev
January 19, 2019

We build a dynamic model to link two empirical patterns: the negative failure probability-return relation (Campbell, Hilscher, and Szilagyi, JF, 2008) and the positive distress risk premium-return relation (Friewald, Wagner, and Zechner, JF, 2014). We...

Maria Dimakopoulou, Susan Athey, Guido W. Imbens
December 2018

Contextual bandit algorithms are sensitive to the estimation method of the outcome model as well as the exploration method used, particularly in the presence of rich heterogeneity or complex outcome models, which can lead to...

Piotr Dworczak, Scott Duke Kominers, Mohammad Akbarpour
November 11, 2018

When macroeconomic tools fail to respond to wealth inequality optimally, regulators can still seek to mitigate inequality within individual markets. A social planner with distributional preferences might distort allocative efficiency to achieve a more desirable...

Hunt Allcott, Rebecca Diamond, Jean-Pierre Dubé, Jessie Handbury, Ilya A. Rahkovsky, Molly Schnell
November 9, 2018

We study the causes of “nutritional inequality”: why the wealthy eat more healthfully than the poor in the United States. Exploiting supermarket entry, household moves to healthier neighborhoods, and purchasing patterns among households with identical...

Shai Bernstein, Rebecca Diamond, Timothy James McQuade, Beatriz Pousada
November 6, 2018

We characterize the contribution of immigrants to US innovation, both through their direct productivity as well as through their indirect spillover effects on their native collaborators. To do so, we link patent records to a...

Susan Athey, Zhengyuan Zhou, Stefan Wager
October 10, 2018

In many settings, a decision-maker wishes to learn a rule, or policy, that maps from observable characteristics of an individual to an action. Examples include selecting offers, prices, advertisements, or emails to send to consumers,...

John Ameriks, Joseph Briggs, Andrew Caplin, Minjoon Lee, Matthew D. Shapiro, Christopher Tonetti
October 2, 2018

Older Americans, even those who are long retired, have strong willingness to work, especially in jobs with flexible schedules. For many, labor force participation near or after normal retirement age is limited more by a...

Susan Athey, Michael Luca
September 11, 2018

As technology platforms have created new markets and new ways of acquiring information, economists have come to play an increasingly central role in tech companies – tackling problems such as platform design, strategy, pricing, and...

Mohammad Akbarpour, Winnie van Dijk
September 2018

Students with identical valuations for public schools but unequal outside options have different opportunity costs of revealing their preferences. Consequently, manipulable mechanisms need not resolve conflicting preferences in a Pareto-improving manner. We show that when...

Lin William Cong, Charles M. C. Lee, Yuanyu Qu, Tao Shen
August 20, 2018

This study reports on the current state-of-affairs in the funding of entrepreneurship and innovations in China and provides a broad survey of academic findings on the subject. We discuss the implications of these findings for...

Charles I. Jones, Christopher Tonetti
July 31, 2018

Data is nonrival: a person’s location history, medical records, and driving data can be used by any number of firms simultaneously without being depleted. Nonrivalry leads to increasing returns and implies an important role for...

Saumitra Jha, Moses Shayo
July 26, 2018

How can we help individuals handle financial decisions in an increasingly complex environment? We explore an easily scalable avenue for improving financial understanding: learning by online trading in stocks. We randomly assign 1345 adults incentives...