Working Papers

We study a dynamic market with asymmetric information that creates the lemons problem. We compare efficiency of the market under different assumptions about the timing of trade. We identify positive and negative aspects of dynamic trading,…

When subjects interact in continuous time, their ability to cooperate may dramatically increase. In an experiment, we study the impact of different time horizons on cooperation in (quasi) continuous time prisoner’s dilemmas. We find that…

To ensure that individual actors take certain actions, community enforcement may be required. This can present a rules-versus-discretion dilemma: It can become impossible to employ discretion based on information that is not widely held, because…

The recession of 2007-09 witnessed high rates of unemployment that have been slow to recede. This has led many to conclude that structural changes have occurred in the labor market and that the economy will not return to the low rates of…

How and by how much do supervisors enhance worker productivity? Using a company-based data set on the productivity of technology-based services workers, supervisor effects are estimated and found to be large. Replacing a boss who is in the…

We provide a tool to model and solve strategic situations where players’ perceptions are limited, in the sense that they may only be aware of, or model, some of the aspects of the strategic situations at hand, as well as situations where players…

We study a dynamic strategic model of voluntary disclosure of multiple pieces of information. Such situations are prevalent in real life, e.g., in corporate disclosure environments that are characterized by information asymmetry between the firm…

We investigate the scope for cooperation within a community engaged in repeated reciprocal interactions. Players seek the help of others and approach them sequentially according to some fixed order, that is, a ranking profile. We study the…

When do voters win? In this paper we derive conditions under which a democracy will produce policies that favor the voter over special interests. We show that increasing political competition, increasing office holding benefits, decreasing…

The central argument for increasing the number of women on corporate boards of directors has been the so-called business case for diversity which proposes that women and minorities add valuable new perspectives that result in enhanced corporate…

I present a theory of optimal multilateral trade agreements with public political shocks. I first show that forbearance - where one country withholds retaliation when its trading partner receives a shock - is a feature of an optimal agreement.…

Tariff bindings and administered protection are two characteristics of the WTO that are little understood. Tariff bindings place a ceiling on tariffs that is not always reached, while administered protection ensures that all sectors have access…

Using an extensive longitudinal data set on franchising firms, we show that established franchisors manage their portfolio of company and franchised units to maintain a particular target level of corporate control and ownership of outlets. On…

The U.S. tri-party repo market is used by major broker-dealers to finance their securities inventories. During the financial crisis of 2007-2009, particularly around the failures of Bear Stearns and Lehman Brothers, it became apparent that this…

We prove that there exist equilibrium payoffs arbitrarily close to the efficient payoff in the two-player prisoner’s dilemma with low discounting under imperfect private monitoring, provided that the monitoring structure is not too uninformative…

We examine the impact of Chinese import competition on patenting, IT, R&D, and TFP using a panel of up to half a million firms over 1996–2007 across twelve European countries. We correct for endogeneity using the removal of product-specific…

Prosper, the largest online social lending marketplace with over a million members and $207 million in funded loans, uses an auction amongst lenders to finance each loan. In each auction, the borrower specifies D, the amount he wants to borrow,…

We impose three conditions on refinements of the Nash equilibria of finite games with perfect recall that select closed connected subsets, called solutions.
A. Each equilibrium in a solution uses undominated strategies;
B. Each solution…

Prequential testing of a forecaster is known to be manipulable if the test must pass an informed forecaster for all possible true distributions. Stewart (2011) provides a non- manipulable prequential likelihood test that only fails an informed…

Price controls lead to misallocation of goods and encourage rent-seeking. The misallocation e¤ect alone is enough to ensure that consumer surplus is always reduced by a price control in an otherwise-competitive market with convex demand if supply…