This thesis examines groundwater management regimes in California and discusses how to implement an optimal aquifer management scheme.
\r\n\r\nChapter 2 examines the effectiveness of adjudication, a legal settlement among groundwater pumpers, in managing groundwater basins in Southern California. As a form of self-governance, adjudication generally leads to higher water level in the adjudicated basins than the unregulated ones. However, its rigid rules impair dynamic efficiency. Compared with the competitive pumpers, pumpers in the adjudicated basins actually have a less counter-cyclical extraction pattern in response to surface water availability.
\r\n\r\nChapter 3 examines how surface water trading intensifies groundwater depletion in California's Central Valley. A surface water market only mitigates the groundwater over-extraction problem when pumping costs are very high, while market failure arises when the pumping costs are low. I build an agricultural water use model to connect the efficacy of the surface water market with crop patterns response to surface water supply variation. The data suggest that the Central Valley is in a low pumping cost regime where the farmers pump groundwater to replace whatever surface water they sell. Therefore, the surface water trade is inefficient because it depletes groundwater resources and should be curtailed until the commons problem is addressed.
\r\n\r\nChapter 4 studies optimal groundwater aquifer management. I solve the dynamic optimization problem for groundwater extraction by a social planner when when farmers are heterogeneous and the surface water supply is uncertain. To implement the optimal pumping plan, the farmers must be allocated pumping rights each period equal to the socially optimal extraction. An incentive compatibility issue arises if farmers have heterogeneous access to groundwater. Those who overlie the deepest part of the aquifer might delay regulation because they will get more water as others exit. A larger amount of farmers must be included in the decision set to resolve this political conflict.
\r\n", "doi": "10.7907/WXTB-7828", "publication_date": "2019", "thesis_type": "phd", "thesis_year": "2019" }, { "id": "thesis:10420", "collection": "thesis", "collection_id": "10420", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:09072017-153615817", "primary_object_url": { "basename": "Song-Li-2017.pdf", "content": "final", "filesize": 540339, "license": "other", "mime_type": "application/pdf", "url": "/10420/1/Song-Li-2017.pdf", "version": "v4.0.0" }, "type": "thesis", "title": "Three Essays on Mechanism Design", "author": [ { "family_name": "Song", "given_name": "Li", "orcid": "0000-0002-1538-1366", "clpid": "Song-Li" } ], "thesis_advisor": [ { "family_name": "Yariv", "given_name": "Leeat", "clpid": "Yariv-L" } ], "thesis_committee": [ { "family_name": "Yariv", "given_name": "Leeat", "clpid": "Yariv-L" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Gillen", "given_name": "Benjamin J.", "clpid": "Gillen-B-J" }, { "family_name": "Plott", "given_name": "Charles R.", "clpid": "Plott-C-R" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This thesis addresses mechanism design problems in three different contexts.
\r\n\r\nChapter 2 compares two widely used student assignment mechanisms, the deferred-acceptance algorithm (DA) and the Boston algorithm (BA), in the context of the Chinese College Admission System. Two features of this system separate the study in this chapter from previous studies. First, the maximal number of schools that a student can apply to is fixed, and is significantly smaller than the total number of schools nationwide. Second, schools\u2019 preferences over applicants are not publicly observed. Under further assumptions, which include that applicants have the same preferences over schools and schools rank applicants by a common standard, I find that students are more likely to compete for seats at top schools under DA than BA. Furthermore, there are cases in which students\u2019 over-competition of top schools under DA results in a less efficient outcome compared to BA.
\r\n\r\nChapter 3 studies the mechanism design problem in a market where buyers have type-dependent outside options. Previous literature usually assumes that buyers obtain a fixed value if they do not participate in a sale. This chapter focuses on scenarios in which the value of the option outside of a particular sale varies across different types of buyers. In such a scenario, an optimal mechanism for selling a private-valued item to unit-demand buyers is a second-price auction, with either a reserve price or a fixed show-up fee. This mechanism induces segregation of the market: buyers with a type which values the item high enough will exercise their outside option.
\r\n\r\nChapter 4 analyzes grant-issuing processes in a mechanism design framework. Applicants submit their proposals for projects that may not be carried out without external funds. The grant issuer makes a selection from the proposals and decides the amount to award each selected project within a budget. This chapter characterizes optimal mechanisms to efficiently allocate the grant-issuer\u2019s budget. The optimal mechanism overcomes the problem of mis-allocation of the current merit-based mechanism. However, the problem of crowding-out private funds still stands. This chapter also shows how the specific formof institutional constraints\u2014the flexibility of the budget constraint, and whether an applicant can reject a grant after being rewarded \u2014 affects the form of the optimal grant-issuing mechanism.
", "doi": "10.7907/Z91834P1", "publication_date": "2018", "thesis_type": "phd", "thesis_year": "2018" }, { "id": "thesis:10983", "collection": "thesis", "collection_id": "10983", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:05312018-141046982", "type": "thesis", "title": "Essays in Market Design", "author": [ { "family_name": "Fernandez", "given_name": "Marcelo Ariel", "orcid": "0000-0002-5475-0304", "clpid": "Fernandez-Marcelo-Ariel" } ], "thesis_advisor": [ { "family_name": "Echenique", "given_name": "Federico", "clpid": "Echenique-F" } ], "thesis_committee": [ { "family_name": "Echenique", "given_name": "Federico", "clpid": "Echenique-F" }, { "family_name": "Yariv", "given_name": "Leeat", "clpid": "Yariv-L" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Saito", "given_name": "Kota", "clpid": "Saito-K" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This thesis investigates the impact of incomplete information and behavioral biases in the context of market design.
\r\n\r\nIn chapter 2, I analyze centralized matching markets and rationalize why the arguably most heavily used mechanism in applications, the deferred acceptance mechanism, has been so successful in practice, despite the fact that it provides participants with opportunities to \u201cgame the system.\u201d Accounting for the lack of information that participants typically have in these markets in practice, I introduce a new notion of behavior under uncertainty that captures participants\u2019 aversion to experience regret. I show that participants optimally choose not to manipulate the deferred acceptance mechanism in order to avoid regret. Moreover, the deferred acceptance mechanism is the unique mechanism within an interesting class (quantile stable) to induce honesty from participants in this way.
\r\n\r\nIn chapter 3, co-authored with Leeat Yariv, we study the impacts of incomplete information on centralized one-to-one matching markets. We focus on the commonly used deferred acceptance mechanism (Gale and Shapley, 1962). We characterize settings in which many of the results known when information is complete are overturned. In particular, small (complete-information) cores may still be associated with multiple outcomes and incentives to misreport, selection of equilibria can affect the set of individuals who are unmatched\u2014i.e., there is no analogue for the Rural Hospital Theorem, and agents might prefer to be on the receiving side of the of the algorithm underlying the mechanism. Nonetheless, when either side of the market has assortative preferences, incomplete information does not hinder stability, and results from the complete-information setting carry through.
\r\n\r\nIn chapter 4, co-authored with Tatiana Mayskaya, we present a dynamic model that illustrates three forces that shape the effect of overconfidence (overprecision of consumed information) on the amount of collected information. The first force comes from overestimating the precision of the next consumed piece of information. The second force is related to overestimating the precision of already collected information. The third force reflects the discrepancy between how much information the agent expects to collect and how much information he actually collects in expectation. The first force pushes an overconfident agent to collect more information, while the second and the third forces work in the other direction. We show that under some symmetry conditions, the second and third force unequivocally dominate the first, leading to underinvestment in information.
", "doi": "10.7907/PXYF-WS15", "publication_date": "2018", "thesis_type": "phd", "thesis_year": "2018" }, { "id": "thesis:9765", "collection": "thesis", "collection_id": "9765", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:05262016-112813537", "primary_object_url": { "basename": "thesis.pdf", "content": "", "filesize": 1308192, "license": "other", "mime_type": "application/pdf", "url": "/9765/1/thesis.pdf", "version": "v1.0.0" }, "type": "thesis", "title": "Electricity Markets for the Smart Grid: Networks, Timescales, and Integration with Control", "author": [ { "family_name": "Cai", "given_name": "Wuhan Desmond", "orcid": "0000-0001-9207-1890", "clpid": "Cai-Wuhan-Desmond" } ], "thesis_advisor": [ { "family_name": "Low", "given_name": "Steven H.", "clpid": "Low-S-H" }, { "family_name": "Wierman", "given_name": "Adam C.", "clpid": "Wierman-A-C" }, { "family_name": "Chandy", "given_name": "K. Mani", "clpid": "Chandy-K-M" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Low", "given_name": "Steven H.", "clpid": "Low-S-H" }, { "family_name": "Wierman", "given_name": "Adam C.", "clpid": "Wierman-A-C" }, { "family_name": "Chandy", "given_name": "K. Mani", "clpid": "Chandy-K-M" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Doyle", "given_name": "John Comstock", "clpid": "Doyle-J-C" }, { "family_name": "Vaidyanathan", "given_name": "P. P.", "clpid": "Vaidyanathan-P-P" } ], "local_group": [ { "literal": "div_eng" } ], "abstract": "We are at the dawn of a significant transformation in the electric industry. Renewable generation and customer participation in grid operations and markets have been growing at tremendous rates in recent years and these trends are expected to continue. These trends are likely to be accompanied by both engineering and market integration challenges. Therefore, to incorporate these resources efficiently into the grid, it is important to deal with the inefficiencies in existing markets. The goal of this thesis is to contribute new insights towards improving the design of electricity markets.
\r\n\r\nThis thesis makes three main contributions. First, we provide insights into how the economic dispatch mechanism could be designed to account for price-anticipating participants. We study this problem in the context of a networked Cournot competition with a market maker and we give an algorithm to find improved market clearing designs. Our findings illustrate the potential inefficiencies in existing markets and provides a framework for improving the design of the markets. Second, we provide insights into the strategic interactions between generation flexibility and forward markets. Our key insight is an observation that spot market capacity constraints can significantly impact the efficiency and existence of equilibrium in forward markets, as they give producers incentives to strategically withhold offers from the markets. Third, we provide insights into how optimization decomposition theory can guide optimal design of the architecture of power systems control. In particular, we illustrate a context where decomposition theory enables us to jointly design market and control mechanisms to allocate resources efficiently across both the economic dispatch and frequency regulation timescales.\r\n
", "doi": "10.7907/Z9BG2KZG", "publication_date": "2016", "thesis_type": "phd", "thesis_year": "2016" }, { "id": "thesis:8860", "collection": "thesis", "collection_id": "8860", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:05142015-114936374", "primary_object_url": { "basename": "Pogorelskiy(2015).PhD_thesis_v1.0.pdf", "content": "final", "filesize": 1432292, "license": "other", "mime_type": "application/pdf", "url": "/8860/1/Pogorelskiy(2015).PhD_thesis_v1.0.pdf", "version": "v2.0.0" }, "type": "thesis", "title": "Essays on Correlated Equilibrium and Voter Turnout", "author": [ { "family_name": "Pogorelskiy", "given_name": "Kirill B.", "orcid": "0000-0002-3426-5870", "clpid": "Pogorelskiy-Kirill-B" } ], "thesis_advisor": [ { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" } ], "thesis_committee": [ { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" }, { "family_name": "Border", "given_name": "Kim C.", "clpid": "Border-K-C" }, { "family_name": "Echenique", "given_name": "Federico", "clpid": "Echenique-F" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This thesis consists of three essays in the areas of political economy and game theory, unified by their focus on the effects of pre-play communication on equilibrium outcomes.
\r\n\r\nCommunication is fundamental to elections. Chapter 2 extends canonical voter turnout models, where citizens, divided into two competing parties, choose between costly voting and abstaining, to include any form of communication, and characterizes the resulting set of Aumann's correlated equilibria. In contrast to previous research, high-turnout equilibria exist in large electorates and uncertain environments. This difference arises because communication can coordinate behavior in such a way that citizens find it incentive compatible to follow their correlated signals to vote more. The equilibria have expected turnout of at least twice the size of the minority for a wide range of positive voting costs.
\r\nIn Chapter 3 I introduce a new equilibrium concept, called subcorrelated equilibrium, which fills the gap between Nash and correlated equilibrium, extending the latter to multiple mediators. Subcommunication equilibrium similarly extends communication equilibrium for incomplete information games. I explore the properties of these solutions and establish an equivalence between a subset of subcommunication equilibria and Myerson's quasi-principals' equilibria. I characterize an upper bound on expected turnout supported by subcorrelated equilibrium in the turnout game.
\r\n\r\nChapter 4, co-authored with Thomas Palfrey, reports a new study of the effect of communication on voter turnout using a laboratory experiment. Before voting occurs, subjects may engage in various kinds of pre-play communication through computers. We study three communication treatments: No Communication, a control; Public Communication, where voters exchange public messages with all other voters, and Party Communication, where messages are exchanged only within one's own party. Our results point to a strong interaction effect between the form of communication and the voting cost. With a low voting cost, party communication increases turnout, while public communication decreases turnout. The data are consistent with correlated equilibrium play. With a high voting cost, public communication increases turnout. With communication, we find essentially no support for the standard Nash equilibrium turnout predictions.
", "doi": "10.7907/Z94B2Z8T", "publication_date": "2015-06", "thesis_type": "phd", "thesis_year": "2015" }, { "id": "thesis:8912", "collection": "thesis", "collection_id": "8912", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:05292015-045627301", "type": "thesis", "title": "Essays in Social and Economic Networks", "author": [ { "family_name": "Chiong", "given_name": "Khai Xiang", "clpid": "Chiong-Khai-Xiang" } ], "thesis_advisor": [ { "family_name": "Echenique", "given_name": "Federico", "clpid": "Echenique-F" }, { "family_name": "Shum", "given_name": "Matthew S.", "clpid": "Shum-M-S" } ], "thesis_committee": [ { "family_name": "Echenique", "given_name": "Federico", "clpid": "Echenique-F" }, { "family_name": "Shum", "given_name": "Matthew S.", "clpid": "Shum-M-S" }, { "family_name": "Yariv", "given_name": "Leeat", "clpid": "Yariv-L" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This thesis consists of three chapters, and they concern the formation of social and\r\neconomic networks. In particular, this thesis investigates the solution concepts of\r\nNash equilibrium and pairwise stability in models of strategic network formation.\r\nWhile the first chapter studies the robustness property of Nash equilibrium in network\r\nformation games, the second and third chapters investigate the testable implication\r\nof pairwise stability in networks.
\r\n\r\nThe first chapter of my thesis is titled \"The Robustness of Network Formation\r\nGames\". In this chapter, I propose a notion of equilibrium robustness, and analyze\r\nthe robustness of Nash equilibria in a class of well-studied network formation\r\ngames that suffers from multiplicity of equilibria. Under this notion of robustness,\r\nefficiency is also achieved. A Nash equilibrium is k-robust if k is the smallest integer\r\nsuch that the Nash equilibrium network can be perturbed by adding some k number\r\nof links. This chapter shows that acyclic networks are particularly fragile: with\r\nthe exception of the periphery-sponsored star, all Nash equilibrium networks without\r\ncycles are 1-robust, or minimally robust. The main result of this paper then proves\r\nthat for all Nash equilibria, cyclic or acyclic, the periphery-sponsored star is the most\r\nrobust Nash equilibrium. Moreover the periphery-sponsored star is by far the most\r\nrobust in the sense that asymptotically in large network, it must be at least twice as\r\nrobust as any other Nash equilibria.
\r\n\r\nThe second chapter of my thesis is titled \"On the Consistency of Network Data with\r\nPairwise Stability: Theory\". In this chapter, I characterize the consistency of social\r\nnetwork data with pairwise stability, which is a solution concept that in a pairwise\r\nstable network, no agents prefer to deviate by forming or dissolving links. I take\r\npreferences as unobserved and nonparametric, and seek to characterize the networks\r\nthat are consistent with pairwise stability. Specifically, given data on a single network,\r\nI provide a necessary and sufficient condition for the existence of some preferences\r\nthat would induce this observed network as pairwise stable. When such preferences\r\nexist, I say that the observed network is rationalizable as pairwise stable. Without any\r\nrestriction on preferences, any network can be rationalized as pairwise stable. Under\r\none assumption that agents who are observed to be similar in the network have similar\r\npreferences, I show that an observed network is rationalizable as pairwise stable if\r\nand only if it satisfies the Weak Axiom of Revealed Pairwise Stability (WARPS). This\r\nresult is generalized to include any arbitrary notion of similarity.
\r\n\r\nThe third chapter of my thesis is titled \"On the Consistency of Network Data with\r\nPairwise Stability: Application\". In this chapter, I investigate the extent to which\r\nreal-world networks are consistent with WARPS. In particular, using the network\r\ndata collected by Banerjee et al. (2013), I explore how consistency with WARPS\r\nis empirically associated with economic outcomes and social characteristics. The\r\nmain empirical finding is that targeting of nodes that have central positions in social\r\nnetworks to increase the spread of information is more effective when the underlying\r\nnetworks are also more consistent with WARPS.
", "doi": "10.7907/Z9639MPX", "publication_date": "2015", "thesis_type": "phd", "thesis_year": "2015" }, { "id": "thesis:8458", "collection": "thesis", "collection_id": "8458", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:06012014-040224456", "primary_object_url": { "basename": "BoseThesis.pdf", "content": "final", "filesize": 2661427, "license": "other", "mime_type": "application/pdf", "url": "/8458/1/BoseThesis.pdf", "version": "v2.0.0" }, "type": "thesis", "title": "An Integrated Design Approach to Power Systems: From Power Flows to Electricity Markets", "author": [ { "family_name": "Bose", "given_name": "Subhonmesh", "clpid": "Bose-Subhonmesh" } ], "thesis_advisor": [ { "family_name": "Low", "given_name": "Steven H.", "clpid": "Low-S-H" }, { "family_name": "Wierman", "given_name": "Adam C.", "clpid": "Wierman-A-C" }, { "family_name": "Chandy", "given_name": "K. Mani", "clpid": "Chandy-K-M" }, { "family_name": "Hassibi", "given_name": "Babak", "clpid": "Hassibi-B" } ], "thesis_committee": [ { "family_name": "Low", "given_name": "Steven H.", "clpid": "Low-S-H" }, { "family_name": "Wierman", "given_name": "Adam C.", "clpid": "Wierman-A-C" }, { "family_name": "Chandy", "given_name": "K. Mani", "clpid": "Chandy-K-M" }, { "family_name": "Hassibi", "given_name": "Babak", "clpid": "Hassibi-B" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Baldick", "given_name": "Ross", "clpid": "Baldick-R" } ], "local_group": [ { "literal": "div_eng" } ], "abstract": "Power system is at the brink of change. Engineering needs, economic forces and environmental factors are the main drivers of this change. The vision is to build a smart electrical grid and a smarter market mechanism around it to fulfill mandates on clean energy. Looking at engineering and economic issues in isolation is no longer an option today; it needs an integrated design approach. In this thesis, I shall revisit some of the classical questions on the engineering operation of power systems that deals with the nonconvexity of power flow equations. Then I shall explore some issues of the interaction of these power flow equations on the electricity markets to address the fundamental issue of market power in a deregulated market environment. Finally, motivated by the emergence of new storage technologies, I present an interesting result on the investment decision problem of placing storage over a power network. The goal of this study is to demonstrate that modern optimization and game theory can provide unique insights into this complex system. Some of the ideas carry over to applications beyond power systems.", "doi": "10.7907/FRGW-AF26", "publication_date": "2014", "thesis_type": "phd", "thesis_year": "2014" }, { "id": "thesis:7750", "collection": "thesis", "collection_id": "7750", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:05242013-104712359", "primary_object_url": { "basename": "dustin_beckett_2013_thesis.pdf", "content": "final", "filesize": 2199524, "license": "other", "mime_type": "application/pdf", "url": "/7750/1/dustin_beckett_2013_thesis.pdf", "version": "v2.0.0" }, "type": "thesis", "title": "An Economic Approach to Consumer Product Ratings", "author": [ { "family_name": "Beckett", "given_name": "Dustin Hughes", "clpid": "Beckett-Dustin-Hughes" } ], "thesis_advisor": [ { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" } ], "thesis_committee": [ { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Border", "given_name": "Kim C.", "clpid": "Border-K-C" }, { "family_name": "Iaryczower", "given_name": "Matias", "clpid": "Iaryczower-M" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "In three essays we examine user-generated product ratings with aggregation. While recommendation systems have been studied extensively, this simple type of recommendation system has been neglected, despite its prevalence in the field. We develop a novel theoretical model of user-generated ratings. This model improves upon previous work in three ways: it considers rational agents and allows them to abstain from rating when rating is costly; it incorporates rating aggregation (such as averaging ratings); and it considers the effect on rating strategies of multiple simultaneous raters. In the first essay we provide a partial characterization of equilibrium behavior. In the second essay we test this theoretical model in laboratory, and in the third we apply established behavioral models to the data generated in the lab. This study provides clues to the prevalence of extreme-valued ratings in field implementations. We show theoretically that in equilibrium, ratings distributions do not represent the value distributions of sincere ratings. Indeed, we show that if rating strategies follow a set of regularity conditions, then in equilibrium the rate at which players participate is increasing in the extremity of agents' valuations of the product. This theoretical prediction is realized in the lab. We also find that human subjects show a disproportionate predilection for sincere rating, and that when they do send insincere ratings, they are almost always in the direction of exaggeration. Both sincere and exaggerated ratings occur with great frequency despite the fact that such rating strategies are not in subjects' best interest. We therefore apply the behavioral concepts of quantal response equilibrium (QRE) and cursed equilibrium (CE) to the experimental data. Together, these theories explain the data significantly better than does a theory of rational, Bayesian behavior -- accurately predicting key comparative statics. However, the theories fail to predict the high rates of sincerity, and it is clear that a better theory is needed.", "doi": "10.7907/00EE-KP91", "publication_date": "2013", "thesis_type": "phd", "thesis_year": "2013" }, { "id": "thesis:7247", "collection": "thesis", "collection_id": "7247", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:10272012-131405182", "primary_object_url": { "basename": "Boosey_PhDThesis_2013.pdf", "content": "final", "filesize": 3958111, "license": "other", "mime_type": "application/pdf", "url": "/7247/1/Boosey_PhDThesis_2013.pdf", "version": "v4.0.0" }, "type": "thesis", "title": "Essays on Information, Competition, and Cooperation", "author": [ { "family_name": "Boosey", "given_name": "Luke Anthony", "clpid": "Boosey-Luke-Anthony" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Echenique", "given_name": "Federico", "clpid": "Echenique-F" }, { "family_name": "Yariv", "given_name": "Leeat", "clpid": "Yariv-L" }, { "family_name": "Rosenthal", "given_name": "Jean-Laurent", "clpid": "Rosenthal-J-L" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This thesis consists of three papers that study the relationships between information, competition, and cooperation in two novel environments. We first examine the competitive behavior of firms with private information in two-sided matching markets. This part of the thesis employs purely game-theoretic tools. Second, we study voluntary contributions towards a linear public good by players who are connected through a network. In this environment, we use experimental and theoretical techniques to examine the effects of different information treatments and network structures on contributions.
\r\n\r\nIn Chapter 2, we study the behavior of firms in a competitive market for workers. In particular, we study a game in which firms with private information compete for workers by committing to a single salary offer. Workers care only about salary and the matching process follows the deferred-acceptance approach introduced by Gale and Shapley (1962). For a two-firm, two-worker model, there exists a Bayesian-Nash equilibrium in which each firm type chooses a distributional strategy with interval support in the salary space. This equilibrium exhibits a separation of types, in the sense that types with a common most preferred worker choose non overlapping, adjacent supports. The type that makes higher offers is determined by the relative marginal value for the preferred worker. In larger markets, which replicate the two-firm, two-worker case, a comparable Bayesian-Nash equilibrium exists and the separation result endures. In the limit, there is no aggregate uncertainty about the realization of firm types, and competition is confined to the most popular worker type. Numerical results suggest that the finite market equilibrium strategies converge with replication to the corresponding equilibrium strategies in the limit case.
\r\n\r\nChapter 3 studies individual contributions in a repeated public goods experiment. Subjects are connected through a circle network, and consumption of the public good depends on a player's own contribution and the contributions of his neighbors. We study whether contributions depend on the nature of the information players are shown about others between rounds of the repeated game. We extend the approach of Arifovic and Ledyard (2009), which merges a modified model of other-regarding preferences (ORP) with a theory of learning. Our model predicts individual behavior that ranges from free-riding, to conditional cooperation, to unconditional giving. Many subjects switch between these different behavioral strategies across games with different information treatments. Individual contributions are remarkably consistent with our model, which combines other-regarding preferences, learning, and the information treatment. Both the data and model simulations suggest that learning (to play the benchmark Nash equilibrium of the game) is differential and contagious across players. Free-riders and unconditional givers learn faster than conditional cooperators, and provide an anchor that accelerates learning by their neighbors. These results suggest that the network or neighborhood structure may be important for contributions through its effects on learning.
\r\n\r\nIn Chapter 4, we extend the analysis of learning and contributions in network public goods experiments. Using a set of five different network structures, we examine three key aspects of individual behavior. First, we report a negative finding regarding the predictions from our theory of other-regarding preferences. The theory provides certain predictions about how a particular subject should and should not behave across networks. We find several violations of these predictions, particularly in small, complete network groups, but also in the larger, more interesting networks. Second, we report on the average contributions by players in groups that consist of all conditional cooperators. In the one-shot game, these groups have a continuum of equilibria, in which every player contributes the same amount. While one might expect contributions to average half of the endowment, we find in both the data and learning simulations that average contributions decline over time to less than half of the endowment. We conjecture that learning dynamics may provide a method of equilibrium selection, for players trying to coordinate on one equilibrium in the repeated game.
\r\n\r\nOur main finding in this chapter is that learning is contagious in networks other than the circle, which we studied in Chapter 3. We find considerable evidence at the individual match level that free-riders and altruists provide an anchor that stabilizes behavior and accelerates learning by their conditional cooperator neighbors. Our analysis highlights the possibility that, even when the distribution of free-riders, altruists, and conditional cooperators is the same across networks, the different neighborhood structures may affect contributions differently through their effects on learning. Thus, the main contribution of this chapter is the confirmation that learning is contagious across a range of different network structures.
", "doi": "10.7907/CQMD-PQ41", "publication_date": "2013", "thesis_type": "phd", "thesis_year": "2013" }, { "id": "thesis:7634", "collection": "thesis", "collection_id": "7634", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:04262013-021647332", "primary_object_url": { "basename": "RuchtiThomas2013thesis.pdf", "content": "final", "filesize": 716969, "license": "other", "mime_type": "application/pdf", "url": "/7634/1/RuchtiThomas2013thesis.pdf", "version": "v4.0.0" }, "type": "thesis", "title": "Markets and Microstructure", "author": [ { "family_name": "Ruchti", "given_name": "Thomas Gorden", "clpid": "Ruchti-Thomas-Gorden" } ], "thesis_advisor": [ { "family_name": "Shum", "given_name": "Matthew S.", "orcid": "0000-0002-6262-915X", "clpid": "Shum-M-S" } ], "thesis_committee": [ { "family_name": "Shum", "given_name": "Matthew S.", "orcid": "0000-0002-6262-915X", "clpid": "Shum-M-S" }, { "family_name": "Cvitani\u0107", "given_name": "Jak\u0161a", "orcid": "0000-0001-6651-3552", "clpid": "Cvitani\u0107-J" }, { "family_name": "Gillen", "given_name": "Benjamin J.", "clpid": "Gillen-B-J" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Bossaerts", "given_name": "Peter L.", "clpid": "Bossaerts-P-L" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This document contains three papers examining the microstructure of financial interaction in development and market settings. I first examine the industrial organization of financial exchanges, specifically limit order markets. In this section, I perform a case study of Google stock surrounding a surprising earnings announcement in the 3rd quarter of 2009, uncovering parameters that describe information flows and liquidity provision. I then explore the disbursement process for community-driven development projects. This section is game theoretic in nature, using a novel three-player ultimatum structure. I finally develop econometric tools to simulate equilibrium and identify equilibrium models in limit order markets.
\r\n\r\nIn chapter two, I estimate an equilibrium model using limit order data, finding parameters that describe information and liquidity preferences for trading. As a case study, I estimate the model for Google stock surrounding an unexpected good-news earnings announcement in the 3rd quarter of 2009. I find a substantial decrease in asymmetric information prior to the earnings announcement. I also simulate counterfactual dealer markets and find empirical evidence that limit order markets perform more efficiently than do their dealer market counterparts.
\r\n\r\nIn chapter three, I examine Community-Driven Development. Community-Driven Development is considered a tool empowering communities to develop their own aid projects. While evidence has been mixed as to the effectiveness of CDD in achieving disbursement to intended beneficiaries, the literature maintains that local elites generally take control of most programs. I present a three player ultimatum game which describes a potential decentralized aid procurement process. Players successively split a dollar in aid money, and the final player--the targeted community member--decides between whistle blowing or not. Despite the elite capture present in my model, I find conditions under which money reaches targeted recipients. My results describe a perverse possibility in the decentralized aid process which could make detection of elite capture more difficult than previously considered. These processes may reconcile recent empirical work claiming effectiveness of the decentralized aid process with case studies which claim otherwise.
\r\n\r\nIn chapter four, I develop in more depth the empirical and computational means to estimate model parameters in the case study in chapter two. I describe the liquidity supplier problem and equilibrium among those suppliers. I then outline the analytical forms for computing certainty-equivalent utilities for the informed trader. Following this, I describe a recursive algorithm which facilitates computing equilibrium in supply curves. Finally, I outline implementation of the Method of Simulated Moments in this context, focusing on Indirect Inference and formulating the pseudo model.
\r\n", "doi": "10.7907/AQV1-S968", "publication_date": "2013", "thesis_type": "phd", "thesis_year": "2013" }, { "id": "thesis:7698", "collection": "thesis", "collection_id": "7698", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:05112013-002045817", "primary_object_url": { "basename": "dissertation.pdf", "content": "final", "filesize": 871823, "license": "other", "mime_type": "application/pdf", "url": "/7698/1/dissertation.pdf", "version": "v2.0.0" }, "type": "thesis", "title": "Essays in Mechanism Design", "author": [ { "family_name": "Pereira de Freitas", "given_name": "Guilherme", "clpid": "Pereira-de-Freitas-Guilherme" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Border", "given_name": "Kim C.", "clpid": "Border-K-C" }, { "family_name": "Rosenthal", "given_name": "Jean-Laurent", "clpid": "Rosenthal-J-L" }, { "family_name": "Shum", "given_name": "Matthew S.", "clpid": "Shum-M-S" }, { "family_name": "Sherman", "given_name": "Robert P.", "clpid": "Sherman-R-P" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This dissertation contains three essays on mechanism design. The common goal of these essays is to assist in the solution of different resource allocation problems where asymmetric information creates obstacles to the efficient allocation of resources. In each essay, we present a mechanism that satisfactorily solves the resource allocation problem and study some of its properties. In our first essay, \u201dCombinatorial Assignment under Dichotomous Preferences\u201d, we present a class of problems akin to time scheduling without a pre-existing time grid, and propose a mechanism that is efficient, strategy-proof and envy-free. Our second essay, \u201dMonitoring Costs and the Management of Common-Pool Resources\u201d, studies what can happen to an existing mechanism \u2014 the individual tradable quotas (ITQ) mechanism, also known as the cap-and-trade mechanism \u2014 when quota enforcement is imperfect and costly. Our third essay, \u201dVessel Buyback\u201d, coauthored with John O. Ledyard, presents an auction design that can be used to buy back excess capital in overcapitalized industries.", "doi": "10.7907/KC2M-1Q94", "publication_date": "2013", "thesis_type": "phd", "thesis_year": "2013" }, { "id": "thesis:7822", "collection": "thesis", "collection_id": "7822", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:06032013-104204451", "primary_object_url": { "basename": "gopalakrishnan_ragavendran_2013.pdf", "content": "final", "filesize": 1600469, "license": "other", "mime_type": "application/pdf", "url": "/7822/1/gopalakrishnan_ragavendran_2013.pdf", "version": "v2.0.0" }, "type": "thesis", "title": "Characterizing Distribution Rules for Cost Sharing Games", "author": [ { "family_name": "Gopalakrishnan", "given_name": "Ragavendran", "clpid": "Gopalakrishnan-Ragavendran" } ], "thesis_advisor": [ { "family_name": "Wierman", "given_name": "Adam C.", "clpid": "Wierman-A-C" } ], "thesis_committee": [ { "family_name": "Wierman", "given_name": "Adam C.", "clpid": "Wierman-A-C" }, { "family_name": "Chandy", "given_name": "K. Mani", "clpid": "Chandy-K-M" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Ligett", "given_name": "Katrina A.", "clpid": "Ligett-K-A" }, { "family_name": "Marden", "given_name": "Jason R.", "clpid": "Marden-J-R" } ], "local_group": [ { "literal": "div_eng" } ], "abstract": "In noncooperative cost sharing games, individually strategic agents choose resources based on how the welfare (cost or revenue) generated at each resource (which depends on the set of agents that choose the resource) is distributed. The focus is on finding distribution rules that lead to stable allocations, which is formalized by the concept of Nash equilibrium, e.g., Shapley value (budget-balanced) and marginal contribution (not budget-balanced) rules.
\r\n\r\nRecent work that seeks to characterize the space of all such rules shows that the only budget-balanced distribution rules that guarantee equilibrium existence in all welfare sharing games are generalized weighted Shapley values (GWSVs), by exhibiting a specific 'worst-case' welfare function which requires that GWSV rules be used. Our work provides an exact characterization of the space of distribution rules (not necessarily budget-balanced) for any specific local welfare functions remains, for a general class of scalable and separable games with well-known applications, e.g., facility location, routing, network formation, and coverage games.
\r\n\r\nWe show that all games conditioned on any fixed local welfare functions possess an equilibrium if and only if the distribution rules are equivalent to GWSV rules on some 'ground' welfare functions. Therefore, it is neither the existence of some worst-case welfare function, nor the restriction of budget-balance, which limits the design to GWSVs. Also, in order to guarantee equilibrium existence, it is necessary to work within the class of potential games, since GWSVs result in (weighted) potential games.
\r\n\r\nWe also provide an alternative characterization—all games conditioned on any fixed local welfare functions possess an equilibrium if and only if the distribution rules are equivalent to generalized weighted marginal contribution (GWMC) rules on some 'ground' welfare functions. This result is due to a deeper fundamental connection between Shapley values and marginal contributions that our proofs expose—they are equivalent given a transformation connecting their ground welfare functions. (This connection leads to novel closed-form expressions for the GWSV potential function.) Since GWMCs are more tractable than GWSVs, a designer can tradeoff budget-balance with computational tractability in deciding which rule to implement.
", "doi": "10.7907/AWE2-H976", "publication_date": "2013", "thesis_type": "phd", "thesis_year": "2013" }, { "id": "thesis:6871", "collection": "thesis", "collection_id": "6871", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:03262012-183213517", "type": "thesis", "title": "Robust Dynamic Mechanisms", "author": [ { "family_name": "Mostagir", "given_name": "Mohamed", "clpid": "Mostagir-Mohamed" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "McAfee", "given_name": "R. Preston", "clpid": "McAfee-R-P" }, { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" }, { "family_name": "Rosenthal", "given_name": "Jean-Laurent", "clpid": "Rosenthal-J-L" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This thesis presents and solves two dynamic problems. The first problem comes from online display advertising. In display advertising, a publisher displays an ad for an advertiser when a targeted user visits a webpage related to the advertiser's products or services. However, the publisher cannot control the supply of display opportunities, and hence the actual supply of ads that it can sell is stochastic. I consider the problem of optimal ad delivery, where the advertiser demands a certain number of impressions to be displayed over a certain time horizon. Time is divided into periods, and in the beginning of each period the publisher chooses a fraction of the still unrealized supply to allocate towards fulfilling the publisher's demand. The goal is to be able to fulfill the demand at the end of the horizon with minimal costs incurred from penalties associated with shortage or overdelivery of impressions. For a special case of this problem I describe an optimal policy that is very easy to implement. The general version of the problem is more computationally demanding, but I describe policies that are both implementable and arbitrarily close to the optimal solution.
\r\n\r\nIn the second part of the thesis, I develop a framework in which a principal can exploit myopic social learning in a population of agents in order to implement social or selfish outcomes that would not be possible under the traditional fully-rational agent model. Learning in this framework takes a simple form of imitation, or replicator dynamics, a class of learning dynamics that often leads the population to converge to a Nash equilibrium of the underlying game. To illustrate the approach, I give a wide class of games for which the principal can obtain strictly better outcomes than the corresponding Nash solution and show how such outcomes can be implemented. The framework is general enough to accommodate many scenarios, and powerful enough to generate predictions that agree with empirically-observed behavior. The last part of the thesis considers two more learning models, best response and fictitious play, and derives the principal's optimal policies theoretically and computationally for the same class of games considered in the social learning model.
\r\n", "doi": "10.7907/9PWJ-QM61", "publication_date": "2012", "thesis_type": "phd", "thesis_year": "2012" }, { "id": "thesis:5988", "collection": "thesis", "collection_id": "5988", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:08112010-110422842", "type": "thesis", "title": "Complex Phenomena in Social and Financial Systems: From Bird Population Growth to the Dynamics of the Mutual Fund Industry", "author": [ { "family_name": "Schwarzkopf", "given_name": "Yonathan", "clpid": "Schwarzkopf-Yonathan" } ], "thesis_advisor": [ { "family_name": "Wise", "given_name": "Mark B.", "clpid": "Wise-M-B" }, { "family_name": "Farmer", "given_name": "J. Doyne", "clpid": "Farmer-J-D" } ], "thesis_committee": [ { "family_name": "Wise", "given_name": "Mark B.", "clpid": "Wise-M-B" }, { "family_name": "Farmer", "given_name": "J. Doyne", "clpid": "Farmer-J-D" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Bossaerts", "given_name": "Peter L.", "clpid": "Bossaerts-P-L" } ], "local_group": [ { "literal": "div_pma" } ], "abstract": "This work explores different aspects of the statics and dynamics of the mutual fund industry. In addition, we answer a major question in the field of complex systems; the anomalous growth fluctuations observed for systems as diverse as breeding birds, city population and GDP.
\r\n \r\nWe study how much control is concentrated in the hands of the largest mutual funds by studying the size distribution empirically. We show that it indicates less concentration than, for example, personal income. We argue that the dominant economic factor that determines the size distribution is market efficiency and we show that the mutual fund industry can be described using a random entry, exit and growth process.
\r\n\r\nMutual funds face diminishing returns to scale as a result of convex trading costs yet there is no persistence nor a size dependence in their performance. To solve this puzzle we offer a new framework in which skillful profit maximizing fund managers compensate for decreasing performance by lowering their fees. We show that mutual fund behavior depends on size such that bigger funds charge lower fees and trade less frequently in more stocks. We present a reduced form model that is able to describe quantitatively this behavior.
\r\n\r\nWe conclude with an investigation of the growth of mutual funds due to investor funds flows. We show that funds exhibit the same unusual growth fluctuations that have been observed for phenomena as diverse as breeding bird populations, the size of U.S. firms, the GDP of individual countries and the scientific output of universities. To explain this we propose a remarkably simple additive replication model. To illustrate how this can emerge from a collective microscopic dynamics we propose a model based on stochastic influence dynamics over a scale-free contact network.
\r\n", "doi": "10.7907/6Y9G-WM75", "publication_date": "2011", "thesis_type": "phd", "thesis_year": "2011" }, { "id": "thesis:6424", "collection": "thesis", "collection_id": "6424", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:05242011-112814785", "type": "thesis", "title": "Limits on Computationally Efficient VCG-Based Mechanisms for Combinatorial Auctions and Public Projects", "author": [ { "family_name": "Buchfuhrer", "given_name": "David Isaac", "clpid": "Buchfuhrer-David-Isaac" } ], "thesis_advisor": [ { "family_name": "Umans", "given_name": "Christopher M.", "clpid": "Umans-C-M" } ], "thesis_committee": [ { "family_name": "Umans", "given_name": "Christopher M.", "clpid": "Umans-C-M" }, { "family_name": "Schulman", "given_name": "Leonard J.", "clpid": "Schulman-L-J" }, { "family_name": "Wierman", "given_name": "Adam C.", "clpid": "Wierman-A-C" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "local_group": [ { "literal": "div_eng" } ], "abstract": "A natural goal in designing mechanisms for auctions and public projects is to maximize the social welfare while incentivizing players to bid truthfully. If these are the only concerns, the problem is easily solved by use of the VCG mechanism. Unfortunately, this mechanism is not computationally efficient in general and there are currently no other general methods for designing truthful mechanisms. However, it is possible to design computationally efficient VCG-based mechanisms which approximately maximize the social welfare.
\r\n \r\nWe explore the design space of computationally efficient VCG-based mechanisms under submodular valuations and show that the achievable approximation guarantees are poor, even compared to efficient non-truthful algorithms. Some of these approximation hardness results stem from an asymmetry in the information available to the players versus that available to the mechanism. We develop an alternative Instance Oracle model which reduces this asymmetry by allowing the mechanism to access some computational capabilities of the players. By building assumptions about player computation into the model, a more realistic study of mechanism design can be undertaken.
\r\n \r\nFinally, we give VCG-based mechanisms for some problems in the Instance Oracle model which achieve provably better approximations than the best VCG-based mechanism in the standard model. However, for other problems we give reductions in the Instance Oracle model which prove inapproximability results as strong as those shown in the standard model. These provide more robust hardness results that are not simply artifacts of the asymmetry in the standard model.
", "doi": "10.7907/N0M7-C473", "publication_date": "2011", "thesis_type": "phd", "thesis_year": "2011" }, { "id": "thesis:6163", "collection": "thesis", "collection_id": "6163", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:10262010-130106361", "primary_object_url": { "basename": "krajbich_thesis_final.pdf", "content": "final", "filesize": 7544827, "license": "other", "mime_type": "application/pdf", "url": "/6163/1/krajbich_thesis_final.pdf", "version": "v4.0.0" }, "type": "thesis", "title": "Neurometrically Informed Mechanism Design and the Role of Visual Fixations in Simple Choice", "author": [ { "family_name": "Krajbich", "given_name": "Ian Michael", "clpid": "Krajbich-Ian-Michael" } ], "thesis_advisor": [ { "family_name": "Rangel", "given_name": "Antonio", "clpid": "Rangel-A" } ], "thesis_committee": [ { "family_name": "Rangel", "given_name": "Antonio", "clpid": "Rangel-A" }, { "family_name": "Camerer", "given_name": "Colin F.", "clpid": "Camerer-C-F" }, { "family_name": "Adolphs", "given_name": "Ralph", "clpid": "Adolphs-R" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "The young field of neuroeconomics has already produced many important insights into the neurobiological underpinnings of decision making. However, at this early stage it is still unclear how much influence the field will have on mainstream economics. Here, I show how a neuroeconomics approach can shed light on two classic economic problems. \r\n\r\nFirst, I show that it is possible to predict individuals\u2019 values for public goods, using functional magnetic resonance imaging (fMRI)-based pattern classification. With such predictions in hand, I demonstrate that it is possible to solve the free-rider problem, by taxing individuals based both on the values that they themselves report and on the predicted values (using fMRI). I go on to more generally prove that by using any informative signal of value, it is possible to overcome classic impossibility results in mechanism design. This allows us to construct mechanisms that simultaneously satisfy dominant strategy incentive compatibility, voluntary participation, budget-balance and social efficiency. Such mechanisms were previously thought to be impossible. I demonstrate how to construct such mechanisms, and test them in three different public goods experiments.\r\n\r\nSecond, I show that individuals\u2019 looking patterns are critical to the decision making process. When people make choices between options, they tend to look back and forth between them. One might think that these \u201cfixations\u201d are an unimportant by-product of the choice process, but I demonstrate that they are in fact intimately tied to the comparison process. By using a variant of the drift-diffusion models from the perceptual decision making literature, I find that fixations seem to bias the accumulation of evidence towards the item that is being looked at. Therefore, if one spends more time looking at one item over the other, then one is more likely to choose that item. Critically, I am able to show that this effect is not due to subjects looking longer at preferred items. The model has deep implications for how looking patterns (treated as exogenous) should bias choices, and I confirm these predictions using eye-tracking data from subjects choosing between snack foods.\r\n", "doi": "10.7907/8Y3X-6W36", "publication_date": "2011", "thesis_type": "phd", "thesis_year": "2011" }, { "id": "thesis:6418", "collection": "thesis", "collection_id": "6418", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:05232011-013046516", "primary_object_url": { "basename": "thesis.pdf", "content": "final", "filesize": 1636443, "license": "other", "mime_type": "application/pdf", "url": "/6418/1/thesis.pdf", "version": "v6.0.0" }, "type": "thesis", "title": "Systematic Design and Formal Verification of Multi-Agent Systems ", "author": [ { "family_name": "Pilotto", "given_name": "Concetta", "clpid": "Pilotto-Concetta" } ], "thesis_advisor": [ { "family_name": "Chandy", "given_name": "K. Mani", "clpid": "Chandy-K-M" } ], "thesis_committee": [ { "family_name": "Chandy", "given_name": "K. Mani", "clpid": "Chandy-K-M" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Murray", "given_name": "Richard M.", "clpid": "Murray-R-M" }, { "family_name": "Doyle", "given_name": "John Comstock", "clpid": "Doyle-J-C" }, { "family_name": "Low", "given_name": "Steven H.", "clpid": "Low-S-H" } ], "local_group": [ { "literal": "div_eng" } ], "abstract": "This thesis presents methodologies for verifying the correctness of multi-agent systems operating in hostile environments. Verification of these systems is challenging because of their inherent concurrency and unreliable communication medium. The problem is exacerbated if the model representing the multi-agent system includes infinite or uncountable data types.
\r\n\r\nWe first consider message-passing multi-agent systems operating over an unreliable communication medium. We assume that messages in transit may be lost, delayed or received out-of-order. We present conditions on the system that reduce the design and verification of a message-passing system to the design and verification of the corresponding shared-state system operating in a friendly environment. Our conditions can be applied both to discrete and continuous agent trajectories.
\r\n\r\nWe apply our results to verify a general class of multi-agent system whose goal is solving a system of linear equations. We discuss this class in detail and show that mobile robot linear pattern-formation schemes are instances of this class. In these protocols, the goal of the team of robots is to reach a given pattern formation.
\r\n\r\nWe present a framework that allows verification of message-passing systems operating over an unreliable communication medium. This framework is implemented as a library of PVS theorem prover meta-theories and is built on top of the timed automata framework. We discuss the applicability of this tool. As an example, we automatically check correctness of the mobile robot linear pattern formation protocols.
\r\n\r\nWe conclude with an analysis of the verification of multi-agent systems operating in hostile environments. Under these more general assumptions, we derive conditions on the agents' protocols and properties of the environment that ensure bounded steady-state system error. We apply these results to message-passing multi-agent systems that allow for lost, delayed, received out-of-order or forged messages, and to multi-agent systems whose goal is tracking time-varying quantities. We show that pattern formation schemes are robust to leaders dynamics, i.e., in these schemes, followers eventually form the pattern defined by the new positions of the leaders.
", "doi": "10.7907/SCQF-VP66", "publication_date": "2011", "thesis_type": "phd", "thesis_year": "2011" }, { "id": "thesis:5936", "collection": "thesis", "collection_id": "5936", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:06072010-231909128", "primary_object_url": { "basename": "thesisSeraLinardi.pdf", "content": "final", "filesize": 1563095, "license": "other", "mime_type": "application/pdf", "url": "/5936/1/thesisSeraLinardi.pdf", "version": "v4.0.0" }, "type": "thesis", "title": "Information and Motivation In Organizations", "author": [ { "family_name": "Linardi", "given_name": "Sera", "clpid": "Linardi-Sera" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Camerer", "given_name": "Colin F.", "clpid": "Camerer-C-F" }, { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" }, { "family_name": "Rosenthal", "given_name": "Jean-Laurent", "clpid": "Rosenthal-J-L" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "My research focuses on incentive/information design for environments where contract enforcement is difficult and the information required for decision-making is dispersed. These environments are particularly challenging when the number of participants are small enough such that small perturbations have persistent influences. In these three chapters, I use theory, computation, and experiment to investigate the robustness of several basic economic mechanisms to stochastic noise.
\r\n\r\nThe first chapter analyzes the basic unit of information aggregation \u2013 the Geanakoplos and Polemarchakis (1982) posterior revision process. I find that if stochastic noise is present, then 1) the posterior revision process does not reliably give public statistics that approach the full information posterior, and 2) methods exist to rank information structures based upon the likelihood that they produce good public statistics through the posterior revision process.
\r\n\r\nThe last two chapters address the impact of stochastic noise on labor markets. The chapter coauthored with Margaret McConnell uncovers the image motivation behind prosociality by enforcing privately known stochastic stopping time in volunteering sessions. A unique cascade of quitting behavior suggests that volunteers are partially driven by stigma avoidance. The third chapter, coauthored with Colin Camerer, analyzes the robustness of\r\ncontracting relationships to exogenous disruptions caused by stochastic drops in demand. We find that stochastic noise slows the formation of relational contracts, but high-quality contracts remain unaffected.
", "doi": "10.7907/TJ7M-T295", "publication_date": "2010-06-11", "thesis_type": "phd", "thesis_year": "2010" }, { "id": "thesis:5876", "collection": "thesis", "collection_id": "5876", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:05282010-090118586", "primary_object_url": { "basename": "DissertationGuidoRevised.pdf", "content": "final", "filesize": 506635, "license": "other", "mime_type": "application/pdf", "url": "/5876/1/DissertationGuidoRevised.pdf", "version": "v5.0.0" }, "type": "thesis", "title": "Contracts and Markets", "author": [ { "family_name": "Maretto", "given_name": "Guido Tulio Andrea", "clpid": "Maretto-Guido-Tullio-Andrea" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Echenique", "given_name": "Federico", "orcid": "0000-0002-1567-6770", "clpid": "Echenique-F" }, { "family_name": "Cvitani\u0107", "given_name": "Jak\u0161a", "orcid": "0000-0001-6651-3552", "clpid": "Cvitani\u0107-J" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "I merge the standard Principal Agent model with a CAPM-type financial market, to study the interactions of contracts and financial markets. I prove existence of equilibrium in two models, a more general economy allowing for hidden type and action under generic mean variance preferences and a hidden action economy with Markowitz mean-variance preferences. I study economies for which markets have an insurance effect on compensation contracts. I show sufficient conditions for lower variance to obtain in large economies, even with asymmetric information. In this context I show the effect of markets' size on efficiency. I also study moral hazard economies, for which I prove existence of a unique pure strategy equilibrium, and I show that financial markets negatively affect the equilibrium returns of firms. In the final chapter I study the efficiency of securities issued under symmetric information. I find that small markets and low correlation of firms' returns generate inefficiency. I also show that the assumption of symmetry or independence is crucial to obtaining the insurance results in the previous Chapters.", "doi": "10.7907/FBS0-F288", "publication_date": "2010-06", "thesis_type": "phd", "thesis_year": "2010" }, { "id": "thesis:5831", "collection": "thesis", "collection_id": "5831", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:05242010-150642550", "primary_object_url": { "basename": "dissertation.pdf", "content": "final", "filesize": 1302935, "license": "other", "mime_type": "application/pdf", "url": "/5831/1/dissertation.pdf", "version": "v4.0.0" }, "type": "thesis", "title": "Essays on Cooperation and Coordination", "author": [ { "family_name": "Romero", "given_name": "Julian Neukom", "clpid": "Romero-Julian-Neukom" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Goeree", "given_name": "Jacob K.", "clpid": "Goeree-J-K" }, { "family_name": "Rosenthal", "given_name": "Jean-Laurent", "clpid": "Rosenthal-J-L" }, { "family_name": "Yariv", "given_name": "Leeat", "clpid": "Yariv-L" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This thesis examines questions related to game theory, and in particular cooperation and coordination among economic agents.
\r\n\r\nIn the first chapter (joint with Noah Myung) we propose a decision making process meant to mimic human behavior. This process is implemented with computational agents. We use these computational agents to run simulations of two coordination games, the minimum-effort coordination game and the Battle of the Sexes game. We find that the computational agents exhibit behavior similar to human subjects from previous experimental work. We then use the computational testbed to develop experimental hypotheses, which are then confirmed in the laboratory using human subjects. In particular, we show that higher cost may actually lead to higher average payoffs in the minimum-effort coordination game.
\r\n\r\nThe second chapter examines a model of infinitely repeated games in which agents are boundedly rational. I show that the number of equilibrium outcomes is smaller when agents are boundedly rational. Importantly, cooperative outcomes are still possible in equilibrium, even when players cannot use sophisticated strategies and are not able to perfectly monitor their opponents. The strategy that leads to cooperation is called \"Win-Stay, Lose-Shift\". Using this strategy, I show that cooperation is possible in equilibrium for a large class of 2x2 games. I also give necessary and sufficient conditions on equilibrium structure for Nx2 games. These conditions suggest that in equilibrium, players must be able to cooperate without getting caught in long periods of conflict.
\r\n\r\nThe final chapter focuses on a class of minimum-effort coordination games. I show that the symmetric quantal response equilibrium correspondence takes the shape of an s-shaped curve as long as players are sufficiently rational. Under certain assumptions, this s-shaped correspondence leads to hysteresis. Based on these theoretical results, I develop experiments with the minimum-effort coordination game, and test the hysteresis hypothesis in the laboratory. I find evidence that this hysteresis does occur when human subjects play the minimum-effort coordination game in the lab.
", "doi": "10.7907/210W-NF91", "publication_date": "2010", "thesis_type": "phd", "thesis_year": "2010" }, { "id": "thesis:3106", "collection": "thesis", "collection_id": "3106", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-08122008-102414", "primary_object_url": { "basename": "David_Young_Thesis.pdf", "content": "final", "filesize": 990915, "license": "other", "mime_type": "application/pdf", "url": "/3106/1/David_Young_Thesis.pdf", "version": "v2.0.0" }, "type": "thesis", "title": "Firm Behaviour in Markets with Capacity Constraints", "author": [ { "family_name": "Young", "given_name": "David Thomas", "clpid": "Young-David-Thomas" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Echenique", "given_name": "Federico", "clpid": "Echenique-F" }, { "family_name": "Iaryczower", "given_name": "Matias", "clpid": "Iaryczower-M" }, { "family_name": "McAfee", "given_name": "R. Preston", "clpid": "McAfee-R-P" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "I study firms' behaviour in markets where firms' long-run capacity decisions, made in the presence of uncertain demand, constrains short-run competition. In Chapter 2, I analyse firms' investment and pricing incentives in a differentiated products framework with uncertain demand. Firms choose production capacities before observing demand and choose prices after demand is realised. Unlike previous models, when firms are identical, symmetric pure-strategy equilibria exist, even in the presence of very low capacity costs. Furthermore, industry capacity in these symmetric equilibria is strictly greater than the equivalent Cournot equilibrium industry capacity for low costs, and equal to the Cournot industry capacity for higher costs. Subsidies on capacity costs have a greater positive impact on equilibrium capacity than an equivalent subsidy on production costs. In Chapter 3, I use this model to analyse how the market changes when firms practice `withholding'. This is when firms withdraw capacity from the market in the short-run, after demand is realised, in the hope of making greater profits. I show that withholding is an optimal strategy for firms in these markets, and that compared to the no-withholding case, equilibrium output is lower in low demand states and higher in high demand states. Equilibrium capacity strictly increases. I discuss why it is hard to find real world examples of withholding in action, despite the increased profits. Chapter 4 looks at the specific case of the electricity industry. Electricity markets are a good example where capacity constraints and random demand affect competitive outcomes. However, trade in electricity is subject to additional constraints caused by the transmission of electricity through a network. Network constraints are well understood to cause considerable non-convexities in firms' optimisation problems; thus theoretical models have limited use in analysing the behaviour of electricity generating firms. An alternative approach, economic experiments, has become an important tool to study these markets, but questions remain on whether subjects can really imitate large firms in the presence of such complexity. This chapter provides evidence in the affirmative, specifically showing that experimental subjects can understand loop flows in the presence of Kirchoff's Laws, a key physical constraint, and how this affects firms' pricing decisions. The results suggest that electricity market experiments could be scaled up successfully to more realistic networks.\r\n", "doi": "10.7907/P1EX-FW81", "publication_date": "2009", "thesis_type": "phd", "thesis_year": "2009" }, { "id": "thesis:1484", "collection": "thesis", "collection_id": "1484", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-04232009-163542", "primary_object_url": { "basename": "Kucuksenel_Thesis.pdf", "content": "final", "filesize": 399101, "license": "other", "mime_type": "application/pdf", "url": "/1484/1/Kucuksenel_Thesis.pdf", "version": "v2.0.0" }, "type": "thesis", "title": "Incentives and Institutions: Essays in Mechanism Design and Game Theory with Applications", "author": [ { "family_name": "Kucuksenel", "given_name": "Serkan", "orcid": "0000-0002-6703-1157", "clpid": "Kucuksenel-Serkan" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Echenique", "given_name": "Federico", "clpid": "Echenique-F" }, { "family_name": "Border", "given_name": "Kim C.", "clpid": "Border-K-C" }, { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "In the first part of this dissertation we study the problem of designing desirable mechanisms for economic environments with different types of informational and consumption externalities. We first study the mechanism design problem for the class of Bayesian environments where preferences of individuals depend not only on their allocations but also on the welfare of other individuals. For these environments, we fully characterize interim efficient mechanisms and examine their properties. This set of mechanisms is compelling since interim efficient mechanisms are the best in the sense that there is no other mechanism which generates unanimous improvement. For public good environments, we show that these mechanisms produce the public good closer to the efficient level of production as the degree of altruism in the preferences increases. For private good environments, we show that altruistic agents trade more often than selfish agents.
\r\n\r\nWe next consider mechanism design problem for matching markets where externalities are present. We present mechanisms that implement the core correspondence of many-to-one matching markets, such as college admissions problems, where the students have preferences over the other students who would attend the same college. With an unrestricted domain of preferences the non-emptiness of the core is not guaranteed. We present a sequential mechanism implementing the core without any restrictions on the preferences. We also show that simple two-stage mechanisms cannot be used to implement the core correspondence in subgame perfect Nash equilibrium without strong assumptions on agents' preferences.
\r\n\r\nIn the final part of the dissertation we focus on another matching market, one-to-one assignment games with money. We present an alternative way to characterize the core as the fixed points of a certain mapping. We also introduce the first algorithm that finds all core outcomes in assignment games. The lattice property of the stable payoffs, as well as its non-emptiness, are proved using Tarski's fixed point theorem. We show that there is a polarization of interests in the core by using our formulation.
\r\n", "doi": "10.7907/EAZA-N950", "publication_date": "2009", "thesis_type": "phd", "thesis_year": "2009" }, { "id": "thesis:2178", "collection": "thesis", "collection_id": "2178", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-05272009-141742", "primary_object_url": { "basename": "thesis.pdf", "content": "final", "filesize": 1176527, "license": "other", "mime_type": "application/pdf", "url": "/2178/1/thesis.pdf", "version": "v3.0.0" }, "type": "thesis", "title": "Credit Risk and Nonlinear Filtering: Computational Aspects and Empirical Evidence", "author": [ { "family_name": "Capponi", "given_name": "Agostino", "orcid": "0000-0001-9735-7935", "clpid": "Capponi-Agostino" } ], "thesis_advisor": [ { "family_name": "Cvitani\u0107", "given_name": "Jak\u0161a", "orcid": "0000-0001-6651-3552", "clpid": "Cvitani\u0107-J" } ], "thesis_committee": [ { "family_name": "Cvitani\u0107", "given_name": "Jak\u0161a", "orcid": "0000-0001-6651-3552", "clpid": "Cvitani\u0107-J" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Chandy", "given_name": "K. Mani", "clpid": "Chandy-K-M" }, { "family_name": "Abu-Mostafa", "given_name": "Yaser S.", "clpid": "Abu-Mostafa-Y-S" } ], "local_group": [ { "literal": "div_eng" } ], "abstract": "This thesis proposes a novel credit risk model which deals with incomplete information on the firm's asset value. Such incompleteness is due to reporting bias deliberately introduced by insider managers and executives of the firm and unobserved by outsiders.
\r\n\r\nThe pricing of corporate securities and the evaluation of default measures in our credit risk framework requires the solution of a computationally unfeasible nonlinear filtering problem. The model introduces computational issues arising from the fact that the optimal probability density on the firm's asset value is the solution of a nonlinear filtering problem, which is computationally unfeasible. We propose a polynomial time-sequential Bayesian approximation scheme which employs convex optimization methods to iteratively approximate the optimal conditional density of the state on the basis of received market observations. We also provide an upper bound on the total variation distance between the actual filter density and our approximate estimator. We use the filter estimator to derive analytical expressions for the price of corporate securities (bond and equity) as well as for default measures (default probabilities, recovery rates, and credit spreads) under our credit risk framework. We propose a novel statistical calibration method to recover the parameters of our credit risk model from market price of equity and balance sheet indicators. We apply the method to the Parmalat case, a real case of misreporting and show that the model is able to successfully isolate the misreporting component. We also provide empirical evidence that the term structure of credit default swaps quotes exhibits special patterns in cases of misreporting by using three well known cases of accounting irregularities in US history: Tyco, Enron, and WorldCom.
\r\n\r\nWe conclude the thesis with a study of bilateral credit risk, which accommodates the case in which both parties of the financial contract may default on their payments. We introduce the general arbitrage-free valuation framework for counterparty risk adjustments in presence of bilateral default risk. We illustrate the symmetry in the valuation and show that the adjustment involves a long position in a put option plus a short position in a call option, both with zero strike and written on the residual net value of the contract at the relevant default times. We allow for correlation between the default times of each party of the contract and the underlying portfolio risk factors. We introduce stochastic intensity models and a trivariate copula function on the default times exponential variables to model default dependence. We provide evidence that both default correlation and credit spread volatilities have a relevant and structured impact on the adjustment. We also study a case involving British Airways, Lehman Brothers, and Royal Dutch Shell, illustrating the bilateral adjustments in concrete crisis situations.
\r\n", "doi": "10.7907/7XV3-9Q45", "publication_date": "2009", "thesis_type": "phd", "thesis_year": "2009" }, { "id": "thesis:5127", "collection": "thesis", "collection_id": "5127", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-12222008-133422", "primary_object_url": { "basename": "Laura_Thesis_ETD.pdf", "content": "final", "filesize": 518070, "license": "other", "mime_type": "application/pdf", "url": "/5127/1/Laura_Thesis_ETD.pdf", "version": "v3.0.0" }, "type": "thesis", "title": "On the Interaction Between Firm Level Variables, the CAPM Beta, and Stock Returns", "author": [ { "family_name": "Panattoni", "given_name": "Laura Elizabeth", "clpid": "Panattoni-Laura-Elizabeth" } ], "thesis_advisor": [ { "family_name": "Lehmann", "given_name": "Bruce N.", "clpid": "Lehmann-B-N" } ], "thesis_committee": [ { "family_name": "McAfee", "given_name": "R. Preston", "clpid": "McAfee-R-P" }, { "family_name": "Lehmann", "given_name": "Bruce N.", "clpid": "Lehmann-B-N" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Hoffman", "given_name": "Philip T.", "clpid": "Hoffman-P-T" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "In Chapter 1, I conduct a theoretical study of how horizontal industry concentration affects a firm\u2019s market capitalization and systematic risk. I first develop a method for incorporating an equilibrium theory of the firm, drawn from industrial organization, into a single period version of the Capital Asset Pricing Model (CAPM). This extension establishes the microeconomic determinants of systematic risk by relating firm specific variables to Beta. Unlike the previous literature, I add local product market shocks to a general, deterministic profit function and use an orthogonal decomposition of the market return to endogenize the Cov[Ri,RM]. I also use this method with standard Hotelling and Cournot models of firm behavior and with different sources of uncertainty to provide examples of how increasing concentration can increase, decrease, and be independent of Beta. In Chapter 2, I exploit a natural experiment afforded by the announcement of \u2018Paragraph IV\u2019 patent infringement decisions. These judgments have two unique features. They create an exogenous change in industry concentration, since they determine whether the corporate owner of a brand name prescription drug will maintain or lose monopoly marketing rights. They also satisfy the methodological requirements to use a short window event study. Against a backdrop of contradictory empirical evidence, this experiment provides a clean test to empirically determine the sign of how a change in horizontal industry concentration affects stock returns. For a sample of 38 District Court decisions between 1992 and 2006, I find that the announcement return is between [1.24%, 2.83%] if the brand firm \u2018wins\u2019 the case and between [-5.24%, -5.82%] if the brand \u2018loses\u2019. Finally, I use these returns to construct the first market valuation of the monopoly rents for brand name pharmaceutical firms. I find that the value to a brand firm of maintaining marketing exclusivity for 1 \u2018average\u2019 drug for 92 months is between [6.48%, 8.65%]. In Chapter 3, I explore the cross-sectional determinants of Beta. The two main goals of this exercise is to understand the explanatory power of popular asset pricing variables and firm level variables, such as the coefficient of variation of profit. The estimation relies on a minimum distance approach that reduces to the familiar least squares estimators. This approach permits the estimation of a dataset where the number of cross sectional observations is larger than the number of time period and accounts for the measurement error in Beta. I use two different sets of variables where one is weighted by assets, referred to as \u2018Book\u2019 variables and the other is weighted by market capitalization, referred to as \u2018Market\u2019 variables. I include two robust checks, one of which includes adding industry fixed effects. I find some striking results with respect to both the two asset pricing variables and the coefficient of variation of profit proxy. Since my statistics are pooled over different time periods, I cite the statistics from the 2001 subperiod because it has three times as many observations as the rest of the periods combined. Turnover has the largest magnitude and t-statistics in both sets of regressions. In 2001, the means of Beta A and Beta were .94 and 1.2 respectively. I found that a one standard deviation change in turnover increased the magnitude of Beta A by .22 and Beta by .25. The bid ask spread percentage had a larger magnitude coefficient in the \u2018Market Regressions\u2019, which indicated that a one standard deviation change in this variable increased Beta by .08. On the other hand, I found that ln(assets), ln(size), and book-to-market had the smallest magnitudes and t-statistics. Finally, both regressions indicate that as the proxy for the coefficient of variation of profit variable increases (decreases) for firms with a positive (negative) expected profit, Beta increases. For the 2001 subperiod in the \u2018Market\u2019 regressions, a one standard deviation change in the absolute value of this proxy, increases Beta by a magnitude of .1 and .15 for firms with positive and negative \u2018earnings\u2019. Finally, these results are robust to industry fixed effects.\r\n", "doi": "10.7907/S0KZ-YT84", "publication_date": "2009", "thesis_type": "phd", "thesis_year": "2009" }, { "id": "thesis:2249", "collection": "thesis", "collection_id": "2249", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-05292007-143256", "primary_object_url": { "basename": "meloso07th.pdf", "content": "final", "filesize": 1048275, "license": "other", "mime_type": "application/pdf", "url": "/2249/1/meloso07th.pdf", "version": "v3.0.0" }, "type": "thesis", "title": "Prices, Holdings, and Learning in Financial Markets: Experiments and Methodology", "author": [ { "family_name": "Meloso", "given_name": "Debrah C. Z.", "clpid": "Meloso-Debrah-C-Z" } ], "thesis_advisor": [ { "family_name": "Bossaerts", "given_name": "Peter L.", "clpid": "Bossaerts-P-L" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Zame", "given_name": "William R.", "clpid": "Zame-W-R" } ], "thesis_committee": [ { "family_name": "Bossaerts", "given_name": "Peter L.", "clpid": "Bossaerts-P-L" }, { "family_name": "Zame", "given_name": "William R.", "clpid": "Zame-W-R" }, { "family_name": "Camerer", "given_name": "Colin F.", "clpid": "Camerer-C-F" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This thesis is a compilation of three essays that bridge the theoretical and empirical study of financial markets. The subjects of study in the three main chapters are (i) equilibrium models of asset prices and asset holdings and trade; (ii) limited computational capacity and its interaction with asset prices and trades.
\r\n\r\nIn chapter 1 (joint with Peter Bossaerts) we show that statistical improvements can be made on a traditional test of portfolio \"efficiency.\" Testing portfolio efficiency is used in the practice of investment decisions as well as to test theoretical models of asset prices (CAPM and multifactor models). We propose a parametric family of tests of the efficiency of a portfolio in a market with a risk-free asset. All tests in the family compare the mean-variance ratio of the tested portfolio (benchmark) with that of a different portfolio (reference). We show that the power of a test in our proposed family depends on the correlation between the benchmark and the reference portfolio. This provides a way to improve the power of efficiency tests for a given sample, by choosing the appropriate test in this family.
\r\n\r\nChapter 2 (joint with Peter Bossaerts and William Zame), is a test of the theory of dynamically complete markets. In this work we compare prices and portfolio choices in complete and incomplete experimental financial markets. The incomplete-markets treatment differs from the complete-markets one in that we close one market, and announce, halfway through trading, which of three states will not occur. We find prices and allocations to be analogous across the two treatments, as predicted by theory. In particular, subjects' additional trading in the incomplete-markets treatment is such that the final allocations become indistinguishable from the complete-markets treatment. The results show that participants form rational expectations about retrade prices, which is a very strong finding.
\r\n\r\nChapter 3 (joint work with Peter Bossaerts and Jernej Copic) moves away from existing theoretical paradigms. It explores the implications of analyzing intellectual discovery as the solution of a nonincremental problem, outside the reach of traditional models of learning with updating. The experiment sets up a situation that is non-incremental and where Bayesian updating is not a sensible model. In this framework we find that communication is possible, and that a primitive code is good enough to achieve intellectual discovery, not discourage it.
", "doi": "10.7907/F0Q4-E311", "publication_date": "2007", "thesis_type": "phd", "thesis_year": "2007" }, { "id": "thesis:2365", "collection": "thesis", "collection_id": "2365", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-06012006-164452", "primary_object_url": { "basename": "thesis.pdf", "content": "final", "filesize": 496724, "license": "other", "mime_type": "application/pdf", "url": "/2365/1/thesis.pdf", "version": "v3.0.0" }, "type": "thesis", "title": "Robust Bilateral Trade and an Essay on Awareness as an Equilibrium Notion", "author": [ { "family_name": "\u010copi\u010d", "given_name": "Jernej", "clpid": "\u010copi\u010d-Jernej" } ], "thesis_advisor": [ { "family_name": "Jackson", "given_name": "Matthew O.", "clpid": "Jackson-M-O" } ], "thesis_committee": [ { "family_name": "Jackson", "given_name": "Matthew O.", "clpid": "Jackson-M-O" }, { "family_name": "Echenique", "given_name": "Federico", "clpid": "Echenique-F" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Zame", "given_name": "William R.", "clpid": "Zame-W-R" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "The aim of this thesis is to analyze various effects of informational constraints. In chapters 1 and 2 we consider a robust model of bilateral trade where traders have private reservation values and utility functions are common knowledge. In chapter 1 we study direct-revelation mechanisms. Under incentive and participation constraints, we define the notion of ex-post constrained efficiency, which does not depend on the distribution of types. Given ex-post incentive and participation constraints, a sufficient condition for constrained efficiency is simplicity: the outcome is a lottery between trade at one type-contingent price and no trade. For constant-relative-risk-aversion environments, we characterize simple mechanisms. Under risk neutrality they are equivalent to probability distributions over posted prices. Generically, simple mechanisms converge to full efficiency as agents' risk aversion goes to infinity. Under risk neutrality, ex-ante optimal mechanisms are deterministic, and under risk aversion, they are not.
\r\n\r\nIn chapter 2 we address indirect implementation. We define Mediated Bargaining Game - a continuous-time double auction with a hidden order book. It is the optimal bargaining game in the sense that its ex-post Nash equilibria in weakly undominated strategies constitute the Pareto-optimal frontier of the set of all ex-post Nash equilibria of all bargaining games. In Mediated Bargaining Game, type-monotone Bayesian equilibria coincide with ex-post Nash equilibria. The inefficiency due to incomplete information is manifested through delay. In contrast with the direct revelation mechanisms, in Mediated Bargaining Game the mechanism designer does not need to know the agents' risk attitudes.
\r\n\r\nInformational constraints may also be a result of agents' subjective knowledge of the economic situation. In chapter 3 we study normal-form games, where each player may be aware of a subset of the set of possible actions, and has a set of possible awareness architectures. Awareness architecture is given by agents' perceptions, and an infinite regress of conjectures about others. Awareness equilibrium is a steady state where neither actions nor awareness architectures can change. We provide conditions under which awareness equilibria exists and study a parametrization of the set of possible awareness architectures.
", "doi": "10.7907/002H-F862", "publication_date": "2006", "thesis_type": "phd", "thesis_year": "2006" }, { "id": "thesis:53", "collection": "thesis", "collection_id": "53", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-01072005-162147", "primary_object_url": { "basename": "dpt_phd_caltech2005.pdf", "content": "final", "filesize": 3081625, "license": "other", "mime_type": "application/pdf", "url": "/53/1/dpt_phd_caltech2005.pdf", "version": "v2.0.0" }, "type": "thesis", "title": "Propagating and Mitigating Uncertainty in the Design of Complex Multidisciplinary Systems", "author": [ { "family_name": "Thunnissen", "given_name": "Daniel Pierre", "clpid": "Thunnissen-Daniel-Pierre" } ], "thesis_advisor": [ { "family_name": "Culick", "given_name": "Fred E. C.", "clpid": "Culick-F-E-C" } ], "thesis_committee": [ { "family_name": "Culick", "given_name": "Fred E. C.", "clpid": "Culick-F-E-C" }, { "family_name": "Antonsson", "given_name": "Erik K.", "clpid": "Antonsson-E-K" }, { "family_name": "Beck", "given_name": "James L.", "clpid": "Beck-J-L" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "local_group": [ { "literal": "GALCIT" }, { "literal": "div_eng" } ], "abstract": "As humanity has developed increasingly ingenious and complicated systems, it has not been able to accurately predict the performance, development time, reliability, or cost of such systems. This inability to accurately predict parameters of interest in the design of complex multidisciplinary systems such as automobiles, aircraft, or spacecraft is due in great part to uncertainty. Uncertainty in complex multidisciplinary system design is currently mitigated through the use of heuristic margins. The use of these heuristic margins can result in a system being overdesigned during development or failing during operation.
\r\n\r\nThis thesis proposes a formal method to propagate and mitigate uncertainty in the design of complex multidisciplinary systems. Specifically, applying the proposed method produces a rigorous foundation for determining design margins. The method comprises five distinct steps: identifying tradable parameters; generating analysis models; classifying and addressing uncertainties; quantifying interaction uncertainty; and determining margins, analyzing the design, and trading parameters. The five steps of the proposed method are defined in detail. Margins are now a function of risk tolerance and are measured relative to mean expected system performance, not variations in design parameters measured relative to heuristic values.
\r\n\r\nAs an example, the proposed method is applied to the preliminary design of a spacecraft attitude determination and control system. In particular, the design of the attitude control system on the Mars Exploration Rover spacecraft cruise stage is used. Use of the proposed method for the example presented yields significant differences between the calculated design margins and the values assumed by the Mars Exploration Rover project.
\r\n\r\nIn addition to providing a formal and rigorous method for determining design margins, this thesis provides three other principal contributions. The first is an uncertainty taxonomy for use in the design of complex multidisciplinary systems with detailed definitions for each uncertainty type. The second is the modification of two simulation techniques, the mean value method and subset simulation, that can significantly reduce the computational burden in applying the proposed method. The third is a set of diverse application examples and various simulation techniques that demonstrate the generality and benefit of the proposed method.
", "doi": "10.7907/0FX2-AM50", "publication_date": "2005", "thesis_type": "phd", "thesis_year": "2005" }, { "id": "thesis:1815", "collection": "thesis", "collection_id": "1815", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-05152005-021009", "primary_object_url": { "basename": "Healy-Dissertation_Full.pdf", "content": "final", "filesize": 1624387, "license": "other", "mime_type": "application/pdf", "url": "/1815/8/Healy-Dissertation_Full.pdf", "version": "v4.0.0" }, "type": "thesis", "title": "Institutions, Incentives and Behavior: Essays in Public Economics and Mechanism Design", "author": [ { "family_name": "Healy", "given_name": "Paul Jay", "clpid": "Healy-Paul-Jay" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Camerer", "given_name": "Colin F.", "clpid": "Camerer-C-F" }, { "family_name": "Echenique", "given_name": "Federico", "clpid": "Echenique-F" }, { "family_name": "McAfee", "given_name": "R. Preston", "clpid": "McAfee-R-P" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "The economic outcomes realized by a society are a function of the institutions put in place, the incentives they create, and the behavior of agents in the face of those incentives. Selecting the appropriate institutions for a given economy is particularly important in the domain of public economics, where individual incentives are often inconsistent with efficiency. Three major concerns in institutional design are addressed. First, do agents select the equilibrium strategies at which efficient allocations obtain? Second, does the repeated game nature of a long-lived institution impact behavior? Third, what degree of coercion is necessary for a planner to guarantee that the allocation selected by a mechanism can be enforced? Answering these questions helps to understand which institutions are most appropriate in various environments. In Chapter 2, five public goods mechanisms are experimentally tested in a repeated game environment. Behavior is well approximated by a model in which agents best respond to an avrage of recently observed data. This model provides various sufficient conditions a mechanism must satisfy for play to converge to an efficient equilibrium. In Chapter 3, it is assumed that the designer of a one-shot mechanism must allow agents a 'no trade' option in which they are free to contribute nothing but enjoy the public good produced by others' contributions. It is shown that a large set of economies exist in which there is some agent at every allocation who prefers this option. Even in economies where this is not true, it becomes true as the economy is replicated, making it impossible to implement any allocation except the endowment in large economies.
\r\n\r\nIn the final chapter, a model of group reputations is developed to explain why moral hazard problems are significant in some laboratory experiments and less significant in others. If firms believe that either all workers are selfish or all workers are reciprocal, then selfish workers may have an incentive to develop a 'group reputation' of being reciprocal for a fixed number of periods in order to extract higher wages. As predicted, only in those experiments in which this incentive is sufficiently large is the moral hazard problem mitigated.
", "doi": "10.7907/X53T-PZ38", "publication_date": "2005", "thesis_type": "phd", "thesis_year": "2005" }, { "id": "thesis:8160", "collection": "thesis", "collection_id": "8160", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:03242014-135929077", "type": "thesis", "title": "Cooperative and Market-Based Solutions to Pollution Abatement Problems", "author": [ { "family_name": "Fine", "given_name": "Leslie Rachel", "clpid": "Fine-Leslie-Rachel" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Jackson", "given_name": "Matthew O.", "clpid": "Jackson-M-O" }, { "family_name": "Kiewiet", "given_name": "D. Roderick", "clpid": "Kiewiet-D-R" }, { "family_name": "Wilkie", "given_name": "Simon J.", "clpid": "Wilkie-S-J" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This work concerns itself with the possibility of solutions, both cooperative and market based, to pollution abatement problems. In particular, we are interested in pollutant emissions in Southern California and possible solutions to the abatement problems enumerated in the\r\n1990 Clean Air Act. A tradable pollution permit program has been implemented to reduce emissions, creating property rights associated with various pollutants.
\r\n\r\nBefore we discuss the performance of market-based solutions to LA's pollution woes, we consider the existence of cooperative solutions. In Chapter 2, we examine pollutant emissions as a trans boundary public bad. We show that for a class of environments in which pollution\r\nmoves in a bi-directional, acyclic manner, there exists a sustainable coalition structure and associated levels of emissions. We do so via a new core concept, one more appropriate to modeling cooperative emissions agreements (and potential defection from them) than the\r\nstandard definitions.
\r\n\r\nHowever, this leaves the question of implementing pollution abatement programs unanswered. While the existence of a cost-effective permit market equilibrium has long been understood, the implementation of such programs has been difficult. The design of Los Angeles' REgional CLean Air Incentives Market (RECLAIM) alleviated some of the implementation problems, and in part exacerbated them. For example, it created two overlapping cycles of permits and two zones of permits for different geographic regions. While these design features create a market that allows some measure of regulatory control, they establish a very difficult trading environment with the potential for inefficiency arising from the transactions costs enumerated above and the illiquidity induced by the myriad assets and relatively few participants in this market.
\r\n\r\nIt was with these concerns in mind that the ACE market (Automated Credit Exchange) was designed. The ACE market utilizes an iterated combined-value call market (CV Market). Before discussing the performance of the RECLAIM program in general and the ACE mechanism in particular, we test experimentally whether a portfolio trading mechanism can overcome market illiquidity. Chapter 3 experimentally demonstrates the ability of a portfolio trading mechanism to overcome portfolio rebalancing problems, thereby inducing sufficient\r\nliquidity for markets to fully equilibrate.
\r\n\r\nWith experimental evidence in hand, we consider the CV Market's performance in the real world. We find that as the allocation of permits reduces to the level of historical emissions, prices are increasing. As of April of this year, prices are roughly equal to the cost of the Best Available Control Technology (BACT). This took longer than expected, due both to tendencies to mis-report emissions under the old regime, and abatement technology advances encouraged by the program. Vve also find that the ACE market provides liquidity where needed to encourage long-term planning on behalf of polluting facilities.
\r\n", "doi": "10.7907/hx59-2c08", "publication_date": "2001", "thesis_type": "phd", "thesis_year": "2001" }, { "id": "thesis:13825", "collection": "thesis", "collection_id": "13825", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:06292020-115132957", "primary_object_url": { "basename": "Thesis - A. Kwasnica 2000.pdf", "content": "final", "filesize": 6608979, "license": "other", "mime_type": "application/pdf", "url": "/13825/1/Thesis - A. Kwasnica 2000.pdf", "version": "v3.0.0" }, "type": "thesis", "title": "Asymmetric Information and Cooperation", "author": [ { "family_name": "Kwasnica", "given_name": "Anthony Mark", "orcid": "0000-0001-6714-8147", "clpid": "Kwasnica-Anthony-Mark" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Border", "given_name": "Kim C.", "clpid": "Border-K-C" }, { "family_name": "Ghirardato", "given_name": "Paolo", "clpid": "Ghirardato-P" }, { "family_name": "McKelvey", "given_name": "Richard D.", "clpid": "McKelvey-R-D" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This thesis investigates the theory of cooperative behavior in the presence of asymmetric information.
\r\n\r\nTraditionally, the core has been a powerful and much used solution concept to describe cooperative outcomes. In settings where agents have some private information, it may be appropriate to include the opportunity for communication in the development of the core. I study the relationship of various core solution concepts with prevalent noncooperative solution concepts for environments with asymmetric information. The core definitions examined vary by the level of communication assumed. In Chapter 2, I investigate the welfare properties of market equilibria. I demonstrate that appropriate communication restrictions can be placed on the core (and efficiency) in order to obtain first and second welfare theorems. In Chapter 3, I discuss the Bayesian implementation of core solutions. If full communication is assumed, Palfrey and Srivastava (1987) have shown that the core is not Bayesian implementable: a game cannot be constructed that has only core allocations as its equilibria. I demonstrate that communication restrictions on the core are sufficient to obtain positive Bayesian implementation results in the environment studied by Palfrey and Srivastava. In other words, a game can be constructed that entices noncooperative players to choose strategies that are cooperative under limited communication.
\r\n\r\nIn Chapter 4, I examine cooperation between bidders in private value, sealed bid auctions. I assume that bidders can overcome their one period temptation to break any collusive agreement, and that they attempt to formulate a collusive mechanism. However, each bidder's valuations are still his own, private information. If he is not given the proper incentives, he may lie about his values in order to increase his profits. Therefore, any collusive mechanism must be incentive compatible and is likely to be, at a minimum, interim efficient. I demonstrate that the theory provides some predictions about the set of collusive mechanisms chosen by bidders and that, when moving to a setting where multiple objects are for sale, the set of feasible collusive mechanisms grows. When multiple objects are for sale, there exist incentive compatible mechanisms that are preferred by all bidders to the only incentive compatible mechanisms in the single object case. Laboratory experiments indicate that these predictions are often consistent with actual behavior. However, deviations by some bidders suggest some weaknesses in this approach.
", "doi": "10.7907/7xpp-6f16", "publication_date": "2000", "thesis_type": "phd", "thesis_year": "2000" }, { "id": "thesis:510", "collection": "thesis", "collection_id": "510", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-02052008-141952", "primary_object_url": { "basename": "Yu_j_1999.pdf", "content": "final", "filesize": 4786678, "license": "other", "mime_type": "application/pdf", "url": "/510/1/Yu_j_1999.pdf", "version": "v2.0.0" }, "type": "thesis", "title": "Discrete approximation of continuous allocation mechanisms", "author": [ { "family_name": "Yu", "given_name": "Jin", "clpid": "Yu-Jin" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Border", "given_name": "Kim C.", "clpid": "Border-K-C" }, { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This dissertation discusses two allocation mechanisms through which prices are set in markets.\r\n\r\nThe first chapter presents theories on discrete-bid auctions. In particular, we focus on four common auction institutions: the sealed-bid first-price auction, the sealed- bid second-price auction, the English auction and the Dutch auction, in a single-object, independent-private-value setting in which bids can only be multiples of some fixed increment. Two different models of English auction, the pay-your-bid and the penultimate-bid English auction are introduced. It is shown that when bids are discrete, second-price auctions and English auctions are no longer dominance solvable as bidding games. Bidding is more aggressive in the penultimate-bid English auction than that in the pay-your-bid English auction. Nevertheless, first-price auctions and Dutch auctions are still strategically equivalent. The equivalence of expected revenues in the continuous case breaks down when bids are discrete. As the number of bidders participating in the auction increases, auctions in which the winner pays the next highest bid (second-price auctions and penultimate-bid English auctions) are more likely to yield higher expected revenues than auctions in which the winner pays his own bid (first-price auctions and pay-your-bid English auctions). The probability of tie in discrete-bid auctions is strictly positive and hence resulting allocations can be Pareto inefficient.\r\n\r\nChapter 2 reports the laboratory observations of bidders' behavior in the pay your-bid and penultimate-bid English auctions. Results of six experiments show that theories developed in the first chapter in general perform very well in predicting the bidding behavior and the price range. However, observations of bidding that is significantly lower than what has been predicted by theory do exist in experiments with small increment. Two possible explanations are discussed.\r\n\r\nChapter 3 discusses a situation in which a monopolist seeks to sell a quality-differentiated spectrum of products of the same generic type to consumers of different characteristics that he cannot observe. The main difference between this framework and the previous literature is that there is a fixed set-up cost of each type of product. The presence of set-up cost makes it impossible for the monopolist to fully separate different types of consumers. The main purpose of this paper is to discuss the monopolist's profit maximization problem and characterize the optimal solution. It is shown that the lowest type in the consumer group consuming the highest quality level would be served efficiently in that the consumer's marginal rate of substitution between price and quality equals that of the monopolist. All other consumers will be served inefficiently and quality distortion takes the form of degradation. The monopolist's profit margin increases with the quality level and an upward shift of the distribution of consumer preference brings higher profit to the monopolist.\r\n", "doi": "10.7907/8SF1-5M95", "publication_date": "1999", "thesis_type": "phd", "thesis_year": "1999" }, { "id": "thesis:13834", "collection": "thesis", "collection_id": "13834", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:06302020-161202022", "primary_object_url": { "basename": "lightbox.jpg", "content": "", "filesize": 1361, "license": "other", "mime_type": "image/png", "url": "/13834/1/lightbox.jpg", "version": "v2.0.0" }, "type": "thesis", "title": "Public Institutions and Private Incentives: Three Essays", "author": [ { "family_name": "Coughlan", "given_name": "Peter Judd", "clpid": "Coughlan-Peter-Judd Coughlan" } ], "thesis_advisor": [ { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" }, { "family_name": "Davis", "given_name": "Lance E.", "clpid": "Davis-L-E" } ], "thesis_committee": [ { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Plott", "given_name": "Charles R.", "clpid": "Plott-C-R" }, { "family_name": "McKelvey", "given_name": "Richard D.", "clpid": "McKelvey-R-D" }, { "family_name": "Wilkie", "given_name": "Simon J.", "clpid": "Wilkie-S-J" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "No abstract available.", "doi": "10.7907/4k08-rw73", "publication_date": "1999", "thesis_type": "phd", "thesis_year": "1999" }, { "id": "thesis:5805", "collection": "thesis", "collection_id": "5805", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:05122010-145733510", "primary_object_url": { "basename": "Williamson_dv_1999.pdf", "content": "final", "filesize": 5761241, "license": "other", "mime_type": "application/pdf", "url": "/5805/1/Williamson_dv_1999.pdf", "version": "v5.0.0" }, "type": "thesis", "title": "The design of agency relations : four essays on contract theory, applications, and experimentation", "author": [ { "family_name": "Williamson", "given_name": "Dean V.", "clpid": "Williamson-D-V" } ], "thesis_advisor": [ { "family_name": "Davis", "given_name": "Lance E.", "clpid": "Davis-L-E" } ], "thesis_committee": [ { "family_name": "Davis", "given_name": "Lance E.", "clpid": "Davis-L-E" }, { "family_name": "Hoffman", "given_name": "Philip T.", "clpid": "Hoffman-P-T" }, { "family_name": "Plott", "given_name": "Charles R.", "clpid": "Plott-C-R" }, { "family_name": "Wilkie", "given_name": "Simon J.", "clpid": "Wilkie-S-J" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "The first part of the thesis takes up a contracting problem in which a venture capitalist (VC) finances agents to conduct risky projects in which the VC can neither observe the agents' actions nor verify the agents' actions ex post. The central issue is how to keep agent from cheating the VC by skimming profits. Theoretical results developed in the first chapter are applied in successive chapters to data sets of maritime contracts that pertain to the financing of Venetian trade in the years 1190-1220 and 1303-1351.\r\n\r\nThe contract data indicate that risk-sharing between contracting parties would less likely obtain in the conduct of the most risk-laden ventures whereas contracting parties tended to share commercial risk in the conduct of those ventures that were least subject to both commercial and physical hazards. Such patterns in the contract data may, at first sight, seem counter-intuitive, but they line up with qualitative predictions of the theoretical framework. The central theoretical finding is that under general conditions debt contracts \u2014 contracts in which agents effectively buy the right to conduct a venture from the VC --dominate contracts in which the VC and agent share commercial risk. An exercise in dynamic optimization indicates that while there might be some scope for risk-sharing between the contracting parties, debt contracts neutralize informational rents an investor must otherwise yield to his agent to induce truthful reporting of outcomes the investor can neither observe nor verify.\r\n\r\nThe second part of the thesis takes up an experimental examination of contracting. The experimental design involves a market in which agents buy and sell rights to participate in a follow-on stage of strategic interaction. The central question posed is how the game and the market, two different types of processes, interact. The results demonstrate that outcomes in the game are systematically linked to outcomes in the market. The game outcomes can be characterized by traditional game-theoretic solution concepts. Moreover, the market converges to a competitive equilibrium consistent with the Nash equilibrium that obtains in the game.", "doi": "10.7907/amkv-hh05", "publication_date": "1999", "thesis_type": "phd", "thesis_year": "1999" }, { "id": "thesis:10345", "collection": "thesis", "collection_id": "10345", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:07102017-155916282", "primary_object_url": { "basename": "HANSON_RD_1998.pdf", "content": "final", "filesize": 48320619, "license": "other", "mime_type": "application/pdf", "url": "/10345/1/HANSON_RD_1998.pdf", "version": "v3.0.0" }, "type": "thesis", "title": "Four Puzzles in Information and Politics : Product Bans, Informed Voters, Social Insurance, & Persistent Disagreement", "author": [ { "family_name": "Hanson", "given_name": "Robin Dale", "clpid": "Hanson-Robin-Dale" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "McKelvey", "given_name": "Richard D.", "clpid": "McKelvey-R-D" }, { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" }, { "family_name": "Wilkie", "given_name": "Simon J.", "clpid": "Wilkie-S-J" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "In four puzzling areas of information in politics, simple intuition and simple theory seem to conflict, muddling policy choices. This thesis elaborates theory to help resolve these conflicts.
\r\n\r\nThe puzzle of product bans is why regulators don't instead offer the equivalent information, for example through a \"would have banned\" label. Regulators can want to lie with labels, however, either due to regulatory capture or to correct for market imperfections. Knowing this, consumers discount regulator warnings, and so regulators can prefer bans over the choices of skeptical consumers. But all sides can prefer regulators who are unable to ban products, since then regulator warnings will be taken more seriously.
\r\n\r\nThe puzzle of voter information is why voters are not even more poorly informed; press coverage of politics seems out of proportion to its entertainment value. Voters can, however, want to commit to becoming informed, either by learning about issues or by subscribing to sources, to convince candidates to take favorable positions. Voters can also prefer to be in large groups, and to be ignorant in certain ways. This complicates the evaluation of institutions, like voting pools, which reduce ignorance.
\r\n\r\nThe puzzle of group insurance as a cure for adverse selection is why this should be less a problem for groups than individuals. The usual argument about reduced variance of types for groups doesn't work in separating equilibria; what matters is the range, not variance, of types. Democratic group choice can, however, narrow the group type range by failing to represent part of the electorate. Furthermore, random juries can completely eliminate adverse selection losses.
\r\n\r\nThe puzzle of persistent political disagreement is that for ideal Bayesians with common priors, the mere fact of a factual disagreement is enough of a clue to induce agreement. But what about agents like humans with severe computational limitations? If such agents agree that they are savvy in being aware of these limitations, then any factual disagreement implies disagreement about their average biases. Yet average bias can in principle be computed without any private information. Thus disagreements seem to be fundamentally about priors or computation, rather than information.
\r\n", "doi": "10.7907/C98N-EV75", "publication_date": "1998", "thesis_type": "phd", "thesis_year": "1998" }, { "id": "thesis:17526", "collection": "thesis", "collection_id": "17526", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:07152025-005839090", "primary_object_url": { "basename": "Papai_S_1996.pdf", "content": "final", "filesize": 45125404, "license": "other", "mime_type": "application/pdf", "url": "/17526/1/Papai_S_1996.pdf", "version": "v2.0.0" }, "type": "thesis", "title": "Dominant Strategy Implementation on Private Goods Domains with Indivisibilities", "author": [ { "family_name": "P\u00e1pai", "given_name": "Szilvia", "orcid": "0000-0001-7895-8364", "clpid": "P\u00e1pai-Szilvia" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Davis", "given_name": "Lance E.", "clpid": "Davis-L-E" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Border", "given_name": "Kim C.", "orcid": "0000-0003-4437-0524", "clpid": "Border-K-C" }, { "family_name": "Palfrey", "given_name": "Thomas R.", "orcid": "0000-0003-0769-8109", "clpid": "Palfrey-T-R" }, { "family_name": "Wilkie", "given_name": "Simon J.", "clpid": "Wilkie-S-J" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "We consider the allocation of indivisible goods to agents who may have private information about their preferences. Standard allocation rules such as Walrasian equilibria or administrative processes fail to perform satisfactorily in this setting. In particular, they are not compatible with individual incentives. Thus, the planner faces an implementation problem, a problem of designing an institution (or mechanism) that induces appropriate incentives for the agents. We examine allocation rules, called social choice functions, for which this implementation problem is solvable, using the dominant strategy solution concept, which requires the implementing mechanism to provide a best action for each agent which does not depend on the other agents' actions. Social choice functions that satisfy this requirement are called strategy proof. We investigate primarily two domains of preferences, the universal private goods domain (Chapter 3), which is only restricted by the assumption that the agents are selfish, and the strict private goods domain (Chapters 1 and 2) , which rules out, in addition, indifference between any two distinct allocations to any agent.
\r\nIn Chapter 1, we consider the allocation of a single indivisible object. Necessary and sufficient conditions for strategyproofness are established, and the relationship between strategyproofness, efficiency, and Pareto-optimality is examined. It is shown that if an indirect form of manipulation, bossiness, is also ruled out, then we obtain a Gibbard-Satterthwaite-type impossibility result. We also prove that all strategy-proof, non-bossy, and Pareto-optimal social choice functions are serial dictatorships.
\r\nWe investigate the allocation of heterogeneous and indivisible objects in Chapters 2 and 3. The objects are heterogeneous in the sense that they typically have different values to an agent. A most important characteristic of our model is that the valuation of the objects\r\ndepend on what other objects they are obtained with. In Chapter 2, we establish that all strategy-proof, strongly non-bossy, and Pareto-optimal social choice functions are serial dictatorships, where strong non-bossiness is a slightly stricter condition than bossiness. We also characterize the set of strategy-proof, non-bossy, and Pareto-optimal social choice functions. Namely, we show that they are dictatorial sequential choice functions, which indicates that the consequences of the Gibbard-Satterthwaite theorem can only be escaped on the strict private goods domain by choosing bossy social choice functions. We also explore two restricted domains, which express complementarity, and, respectively, substitutability of the objects. Finally, we briefly examine full implementation and social choice correspondences, allocation rules that may prescribe multiple outcomes to preference profiles.
\r\nIn Chapter 3, we explore the allocation of heterogeneous indivisible objects when monetary transfers can be used to induce the right incentives for the agents. When the utility functions are additively separable and linear in the currency in which the transfers are paid, a mechanism is strategy-proof and value maximizing if, and only if, it is a Groves mechanism. We impose further criteria, namely, envy-freeness and individual rationality, to choose among the Groves mechanisms. We show that none of the Groves mechanisms is envy-free on the universal private goods domain. However, we characterize the sets of envyfree, and the sets of both envyfree and individually rational Groves mechanisms on the two examined restricted domains. Some revenue related criteria are also examined.
", "doi": "10.7907/ted7-zm26", "publication_date": "1996", "thesis_type": "phd", "thesis_year": "1996" }, { "id": "thesis:13828", "collection": "thesis", "collection_id": "13828", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:06292020-131040227", "primary_object_url": { "basename": "saving-jl-1996.pdf", "content": "final", "filesize": 4295859, "license": "other", "mime_type": "application/pdf", "url": "/13828/1/saving-jl-1996.pdf", "version": "v3.0.0" }, "type": "thesis", "title": "Welfare Magnets, the Labor-Leisure Decision and Economic Efficiency", "author": [ { "family_name": "Saving", "given_name": "Jason Lee", "clpid": "Saving-Jason-Lee" } ], "thesis_advisor": [ { "family_name": "Palfrey", "given_name": "Thomas R.", "orcid": "0000-0003-0769-8109", "clpid": "Palfrey-T-R" }, { "family_name": "Davis", "given_name": "Lance E.", "clpid": "Davis-L-E" } ], "thesis_committee": [ { "family_name": "Palfrey", "given_name": "Thomas R.", "orcid": "0000-0003-0769-8109", "clpid": "Palfrey-T-R" }, { "family_name": "Alvarez", "given_name": "R. Michael", "orcid": "0000-0002-8113-4451", "clpid": "Alvarez-R-M" }, { "family_name": "Katz", "given_name": "Jonathan N.", "orcid": "0000-0002-5287-3503", "clpid": "Katz-J-N" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Davis", "given_name": "Lance E.", "clpid": "Davis-L-E" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This thesis examines the issue of welfare recipiency. In the first chapter, I develop a model designed to capture the fiscal externalities associated with redistributive policy in a system of jurisdictions. Previous work in the migration literature ignores work-disincentive\r\neffects and concludes that relatively generous jurisdictions will attract welfare recipients but repel workers. I present a model that integrates migration with labor-leisure choice and I find that inclusion of labor-leisure effects unambiguously worsens the fiscal externalities of redistribution. In addition, I derive conditions under which an increase in redistribution will harm its beneficiaries.
\r\n\r\nIn the second chapter,I address the issue of benefit harmonization. Within both the European Union and the United States, advocates of redistribution have suggested that benefits be \"harmonized\" at levels offered by their most generous members in order to protect those members from the fiscal externalities associated with redistribution, and these advocates. further suggest that such a harmonization would enhance economic efficiency. The economic-efficiency argument is bolstered by traditional work in the public finance literature, but the work from which this conclusion is drawn does not account for the work-disincentive effects associated with redistributive policy. I find that, when work-disincentive effects are considered, the process of benefit harmonization need not improve economic efficiency unless the level at which benefits are harmonized is sufficiently low.
", "doi": "10.7907/sxj0-3216", "publication_date": "1996", "thesis_type": "phd", "thesis_year": "1996" }, { "id": "thesis:3505", "collection": "thesis", "collection_id": "3505", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-09122007-103429", "primary_object_url": { "basename": "Chen_y_1995.pdf", "content": "final", "filesize": 3057445, "license": "other", "mime_type": "application/pdf", "url": "/3505/1/Chen_y_1995.pdf", "version": "v3.0.0" }, "type": "thesis", "title": "A theoretical study of political institutions and economic policies", "author": [ { "family_name": "Chen", "given_name": "Yan", "clpid": "Chen-Yan-Social-Science" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Ordeshook", "given_name": "Peter C.", "clpid": "Ordeshook-P-C" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Border", "given_name": "Kim C.", "clpid": "Border-K-C" }, { "family_name": "Ordeshook", "given_name": "Peter C.", "clpid": "Ordeshook-P-C" }, { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This dissertation consists of two relatively independent chapters that study the effects of political institutions on economic policies.
\r\n\r\nChapter I studies the privatization policies of maximizing politicians in a tightly managed transition economy under different political institutions. The majority of literature pertaining to privatization policies ignores the political constraints and the motivation of the politicians. In this dissertation, we consider two types of politicians, a Niskanen-style Bureaucrat who maximizes a surplus budget subject to the constraint of staying in office, and a Populist who maximizes consumer welfare subject to the constraint of a balanced budget. Other things being equal, the Bureaucrat will privatize the sector (firms) with the least market power and the largest subsidy first. The Populist will adopt the same policy, if the marginal costs of products in the private sectors are not too high with respect to the marginal utilities. We also show that controlled privatization is easier and faster in less democratic societies.
\r\n\r\nChapter 2 examines the effects that political processes, i.e., electoral systems and legislative processes, have on income taxation and public good allocation. We characterize the equilibrium income tax schedules under two types of political institutions. It is shown that, when there is a single district, for the two party plurality system the equilibrium income tax schedule is equivalent to an optimal tax schedule that puts equal weight over the whole population; when there are multiple districts, however, the simplest subgame perfect stationary equilibrium tax schedule of the stochastic legislative game is equivalent to an optimal tax schedule that puts more welfare weight on the subsets of the population whose legislators are in the winning coalition of the legislature. Thus, the social welfare functions in the optimal taxation literature can be endogenously determined by explicitly modelling the political processes that determines them.
", "doi": "10.7907/mzzc-zc64", "publication_date": "1995", "thesis_type": "phd", "thesis_year": "1995" }, { "id": "thesis:4270", "collection": "thesis", "collection_id": "4270", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-10262007-105829", "primary_object_url": { "basename": "Udell_ma_1995.pdf", "content": "final", "filesize": 4338168, "license": "other", "mime_type": "application/pdf", "url": "/4270/1/Udell_ma_1995.pdf", "version": "v3.0.0" }, "type": "thesis", "title": "Essays in applied economics : new techniques in aggregate data analysis", "author": [ { "family_name": "Udell", "given_name": "Michael Alan", "clpid": "Udell-M-A" } ], "thesis_advisor": [ { "family_name": "Kiewiet", "given_name": "D. Roderick", "clpid": "Kiewiet-D-R" } ], "thesis_committee": [ { "family_name": "Kiewiet", "given_name": "D. Roderick", "clpid": "Kiewiet-D-R" }, { "family_name": "Dubin", "given_name": "Jeffrey A.", "clpid": "Dubin-J-A" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This dissertation consists of three essays in applied economics. Common to each essay is the use of aggregate data. The first two essays address the demand for tax return preparation services and the effect of that demand on tax evasion. The third essay is an analysis of the effect of general economic conditions on congressional House elections.\n\nIn the first chapter, I analyze taxpayer choices of return preparation services. In particular, I distinguish between two types of nonpaid preparation, six types of paid third parties, and self-preparation. Among other things, I find significant differences in the factors which explain the demand for paid third parties who are and are not able to represent clients before the IRS. Among these factors are increases in IRS audit rates, the frequency of IRS penalties, and the complexity of the tax return.\n\nThe second chapter builds upon the results of the first chapter and analyzes the effect that different modes of tax return preparation have on tax evasion. Specifically, I allow for three assisted modes of return preparation and self-preparation to effect the level of tax evasion detected on returns they prepared. Chief among my findings is that while returns prepared by third parties who are able to represent their clients before the IRS are characterized by the greatest amounts of income and the most complex tax situations, after controlling for these factors, these returns exhibit less non-compliance than those prepared by the other modes of return preparation. The third chapter addresses a long standing controversy as to whether general economic conditions effect the outcome of congressional House elections. I test this general hypothesis by applying new estimates of historical gross national product and unemployment, as well as robust regression techniques useful for the identification of influential observations, to a variety of models in the political science literature that address the outcomes of congressional House elections. The use of new data strongly supports the proposition that changes in gross national product and unemployment have a significant impact on the congressional House election outcomes.\n", "doi": "10.7907/4d5q-ej78", "publication_date": "1995", "thesis_type": "phd", "thesis_year": "1995" }, { "id": "thesis:4185", "collection": "thesis", "collection_id": "4185", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-10192007-143628", "primary_object_url": { "basename": "Sherstyuk_k_1995.pdf", "content": "final", "filesize": 6706661, "license": "other", "mime_type": "application/pdf", "url": "/4185/1/Sherstyuk_k_1995.pdf", "version": "v3.0.0" }, "type": "thesis", "title": "The formation of teams under incomplete information", "author": [ { "family_name": "Sherstyuk", "given_name": "Katerina", "clpid": "Sherstyuk-K" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Plott", "given_name": "Charles R.", "clpid": "Plott-C-R" }, { "family_name": "Grether", "given_name": "David M.", "clpid": "Grether-D-M" }, { "family_name": "Porter", "given_name": "David", "clpid": "Porter-D" }, { "family_name": "Border", "given_name": "Kim C.", "clpid": "Border-K-C" }, { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "NOTE: Text or symbols not renderable in plain ASCII are indicated by [...]. Abstract is included in .pdf document.\n\n\n\nOrganizational forms such as task-oriented teams have often been proposed as a method to enhance the efficiency of a firm. Under asymmetric information, however, the costs of acquiring the information needed to improve efficiency may outweigh the efficiency gain and lead to lower profits. This dissertation analyzes profitability-efficiency trade-offs faced by a profit-maximizing principal who wants to select teams from a given group of heterogeneous agents to work on a number of projects, given that the principal has incomplete information about the agents' abilities.\n\n\tThe dissertation consists of two main chapters. In chapter one, we take a theoretical mechanism design approach to analyze the problem of the formation of multiple teams under different information structures and behavioral assumptions. We study feasible incentive-compatible (truth-revealing) individually rational mechanisms under both the dominant strategy and Bayesian Nash behavioral assumptions. Some attention is also paid to Nash equilibrium mechanisms. The chapter covers derivation of optimal mechanisms, efficiency analysis, and analysis of the principal's expected profit as a function of different types of environment and information structures. We find that if the principal has little or no information about the agents' private characteristics and the agents follow dominant strategy behavior, the principal may often run into losses in an attempt to discover the hidden information. Paradoxically, the loss occurs when the efficiency gains from team production are high and the competition among the agents is low. If the hidden information about each agent can be summarized as a one-dimensional type parameter, and if a prior distribution function of the agents' types is common knowledge among the agents and the principal, an expected-profit maximizing Bayesian equilibrium mechanism exists and is of the optimal auction form (Myerson, 1981). Moreover, the mechanism can be equivalently implemented in dominant strategies with no expected profit loss for the principal. Yet, the principal's profit often decreases with an increase in the number of projects. The findings suggest that, in profit-maximizing firms with low competition among the employees, efficient organizational forms may often be foregone in favor of profits.\n\n\tIn chapter 2 we consider, theoretically and experimentally, one specific type of the team formation mechanisms, a wage-demand mechanism, first suggested by Bolle (1991). Under these mechanisms, potential team members submit their wage demands to the principal and the principal chooses a team which gives her the highest profit - defined as the output of the team net of wages demanded by the team-members, and then pays all the employed agents their demanded wages. Bolle found that the principal's ability to detect and choose efficient teams among the profit-maximizing teams is essential for the existence of pure strategy Nash equilibria of the wage-demand games. We consider wage-demand mechanisms in a framework when the principal might have incomplete information about the agents' characteristics. In this case, the pure strategy Nash equilibria of the wage-demand game do not exist. However, there are [...]-Nash equilibria, which are close in efficiency and profitability to the Nash equilibria of the complete information game.\n\n\tWe present the results of experimental tests of the Nash and [...]-Nash behavioral hypothesis for the team-selection wage-demand games corresponding to complete and incomplete information cases. If the agents do follow the Nash equilibrium behavior, then the principal's information should not significantly affect the outcomes of the games regarding team's profitabilities and efficiencies. In his experimental investigation of the wage-demand games, Bolle found that the subjects often do not follow the competitive Nash equilibrium behavior, but engage in \"tacit collusion.\" We test the robustness of Bolle's findings by introducing asymmetry into agent's productivity characteristics. We find that although some collusive tendencies are present in the subjects behavior, they are not sustainable; with repetition, the outcomes of the wage-demand games converge to the Nash equilibrium outcomes. However, we find that the two experimental treatments corresponding to the complete and incomplete information on the principal's part are not equivalent in the degrees of agents' competition and cooperation. In our experiments the agents were significantly more collusive when the principal had incomplete information, and the outcomes were less profitable for the principal. Thus, we once again confirm that information does matter for the profit-maximizing principal.\n", "doi": "10.7907/4cqc-pj45", "publication_date": "1995", "thesis_type": "phd", "thesis_year": "1995" }, { "id": "thesis:3626", "collection": "thesis", "collection_id": "3626", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-09182007-084408", "primary_object_url": { "basename": "Duggan_j_1995.pdf", "content": "final", "filesize": 4154971, "license": "other", "mime_type": "application/pdf", "url": "/3626/1/Duggan_j_1995.pdf", "version": "v3.0.0" }, "type": "thesis", "title": "Bayesian Implementation", "author": [ { "family_name": "Duggan", "given_name": "John R.", "clpid": "Duggan-John-R" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Davis", "given_name": "Lance E.", "clpid": "Davis-L-E" } ], "thesis_committee": [ { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" }, { "family_name": "Border", "given_name": "Kim C.", "clpid": "Border-K-C" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "McKelvey", "given_name": "Richard D.", "clpid": "McKelvey-R-D" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "In Chapter 1, I briefly survey the literature on Bayesian implementation, discuss its shortcomings, and summarize the contribution of this thesis. In Chapter 2, I formally state the implementation problem, making no assumptions about the agents' sets of types, preferences, or beliefs, and I prove Jackson's (1991) necessity and sufficiency results for environments satisfying two weak conditions called \"invariance\" and \"independence.\" In short, incentive compatibility and Bayesian monotonicity are necessary for Bayesian implementability, and incentive compatibility and monotonicity-no-veto are sufficient. I prove Jackson's result that, for environments with conflict of interest, Bayesian monotonicity and monotonicity-no-veto are equivalent, but I show that conflict-of-interest places an unnatural restriction on agents' beliefs when the set of states is uncountable. I note that, when agents have uncountable sets of types, preferences over social choice functions derived from conditional expected utility calculations will generally be incomplete, and I show that this incompleteness sometimes leads to implausible Bayesian equilibrium predictions. I propose an extension of expected utility preferences that preserves the properties of invariance and independence.
\r\n\r\nIn Chapter 3, I consider environments satisfying invariance and a condition called \"interiority,\" and I show that incentive compatibility and an extension of Bayesian monotonicity are necessary and sufficient for Bayesian implementability. Using the extension of expected utility preferences proposed in Chapter 2 and assuming best-element-private values, I then show that interiority is satisfied in two important classes of environments: it holds in private and public good economies, and it holds in lottery environments, for which the set of outcomes is the set of probability measures over a measurable space of pure outcomes.
\r\n\r\nIn Chapter 4, I consider lottery environments satisfying best-element-private values and a condition called \"strict separability,\" and I use the results of Chapter 3 to show that incentive compatibility is necessary and sufficient for virtual Bayesian implement ability. I then show that strict separability is satisfied for a suitably large class of environments. It holds when private values and value-distinguished types are satisfied and the set of pure outcomes is finite, and it holds when private values and value-distinguished types are satisfied and the set of pure outcomes is a finite set crossed with an open set of allocations of a transferable private good.
\r\n", "doi": "10.7907/7A6K-F810", "publication_date": "1995", "thesis_type": "phd", "thesis_year": "1995" }, { "id": "thesis:7288", "collection": "thesis", "collection_id": "7288", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:11272012-141940042", "primary_object_url": { "basename": "Cull_rj_1993.pdf", "content": "final", "filesize": 46679475, "license": "other", "mime_type": "application/pdf", "url": "/7288/1/Cull_rj_1993.pdf", "version": "v5.0.0" }, "type": "thesis", "title": "A comparative study of capital market failure and institutional innovation", "author": [ { "family_name": "Cull", "given_name": "Robert Joseph", "clpid": "Cull-R-J" } ], "thesis_advisor": [ { "family_name": "Davis", "given_name": "Lance E.", "clpid": "Davis-L-E" } ], "thesis_committee": [ { "family_name": "Grether", "given_name": "David M.", "clpid": "Grether-D-M" }, { "family_name": "Kousser", "given_name": "J. Morgan", "clpid": "Kousser-J-M" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Hughson", "given_name": "Eric", "clpid": "Hughson-E" }, { "family_name": "Hoffman", "given_name": "Philip T.", "clpid": "Hoffman-P-T" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "Comprised of two separate projects, this study examines imperfections in early capital markets. The first concerns the insurance benefits associated with the scattered landholdings of medieval peasant farmers while the second\r\ntraces the evolution of securities markets in the United States. In particular, the second focuses on both the development of the New York Stock Exchange and the role of the London Stock Exchange in channeling capital to U.S.\r\nfirms.
\r\nPrevious research suggests that scattered holdings may have reduced variation in annual agricultural yields. The argument hinges on the notion that yields were not too highly correlated on separate plots of land within the\r\nsame village. To this point, however, researchers have lacked the sort of data necessary to adequately test this hypothesis.
\r\n\r\nTithe records from two villages in northern France-Onnaing and Quarouble-provide the basis for constructing a time series of financial returns on individual plots of land. Using these returns, a portfolio analysis is undertaken to measure the reduction in yield variances associated with scattering. The results suggest that it was crop diversification, not scattering, that provided insurance benefits to peasant farmers.
\r\n\r\nIn the second project, data from the London Stock Exchange indicate that, in the nineteenth and early twentieth centuries, British capital funded many ventures in the emerging American West. Many of these ventures,\r\nmoreover, were not able to attract finance through the aegis of the premier domestic capital market- the New York Stock Exchange.
\r\n\r\nFinancial data from a number of stock exchanges- most notably the New York, the London, and the Boston-and institutional descriptions drawn from various published sources, suggest that, in an effort to relieve uncertainty\r\nand establish wider markets for their securities, the Governors of the New York exchange developed a set of trading rules and vetting procedures which excluded securities from small new companies. Not surprisingly, these\r\nfirms were often located in the West.
\r\n", "doi": "10.7907/0035-VJ05", "publication_date": "1993", "thesis_type": "phd", "thesis_year": "1993" }, { "id": "thesis:7270", "collection": "thesis", "collection_id": "7270", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:11132012-114140098", "type": "thesis", "title": "Fiscal policies, optimal growth, and elections under different economic systems", "author": [ { "family_name": "Lian", "given_name": "Peng", "clpid": "Lian-P" } ], "thesis_advisor": [ { "family_name": "McKelvey", "given_name": "Richard D.", "clpid": "McKelvey-R-D" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Ordeshook", "given_name": "Peter C.", "clpid": "Ordeshook-P-C" }, { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "Using a general equilibrium approach, I develop a two-period model that provides\r\nmicroeconomic foundations for the relationship among fiscal policies,\r\noptimal growth, and elections under two different economic systems: a free\r\neconomy and a democratic planned economy.
\r\n\r\nIn a free economy (Chapter 2), I assume the government indirectly controls\r\nthe economy by selecting a fiscal policy, and a firm chooses the growth\r\npath. First, I show that fiscal policy determines the endogenous growth of\r\nthe economy, and fiscal policy is determined by the distribution of income.\r\nSecond, ceteris paribus, the wealthier are more likely to oppose a larger government\r\nand a redistribution-oriented fiscal policy. Third, I show that binary\r\nvoting procedures always generate the median-income consumer as the majority\r\nwinner. Fourth, when a private good utility has a constant elasticity of\r\nmarginal utility of income. then (a) fiscal policy and income distribution have\r\nno effects on economic growth; (b) among different distributions of income,\r\nthe higher the profit share of the decisive consumer (i.e., median-income consumer),\r\nthe lower the tax rate; (c) under certain conditions, the inverted-U\r\ncurve relationship between economic development and income inequality (the\r\nKuznets Curve) does not exist.
\r\n\r\nIn a democratic planned economy (Chapter 3), I assume the government\r\ncontrols the economy by setting wage rates, prices and the growth rate of the\r\neconomy. First, I show that there exist voting equilibria which are sensitive\r\nto agenda setting in most cases. Second, I show that with Cobb-Douglas\r\nproduction technology, decentralization of wage decisions in a democratic\r\nplanned economy can guarantee a unique political-economic equilibrium and\r\na growth path that is middle-class-oriented. Third, when utility satisfies\r\ncertain conditions, a democratic planned economy can experience the same\r\ngrowth path and income-distributional neutrality on growth as that of a free\r\neconomy.
\r\n\r\nCross-country and cross-time empirical evidence (Chapter 4) are provided\r\nto test theoretical predictions and raise questions for future theoretical explanation.\r\nIn particular, I find that the growth rate of the population and\r\nthe ratio of gross private investment to GDP have significantly negative and\r\npositive effects on economic growth, respectively.
", "doi": "10.7907/4ear-vt60", "publication_date": "1993", "thesis_type": "phd", "thesis_year": "1993" }, { "id": "thesis:2971", "collection": "thesis", "collection_id": "2971", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-07232007-145323", "primary_object_url": { "basename": "Olson_ma_1991.pdf", "content": "final", "filesize": 9590224, "license": "other", "mime_type": "application/pdf", "url": "/2971/1/Olson_ma_1991.pdf", "version": "v3.0.0" }, "type": "thesis", "title": "The Assignment Problem: Theory and Experiments", "author": [ { "family_name": "Olson", "given_name": "Mark Allen", "clpid": "Olson-Mark-Allen" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "McKelvey", "given_name": "Richard D.", "clpid": "McKelvey-R-D" }, { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" }, { "family_name": "Grether", "given_name": "David M.", "clpid": "Grether-D-M" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "In this thesis I consider the problem of assigning a fixed and heterogeneous set of goods or services to a fixed set of individuals. I analyze this allocation problem with and without the use of monetary transfers to allocate good.
\r\n\r\nThere are many applications in the literature associated with this problem. The usual approach to this problem has been to discuss the properties of individual mechanisms (variously called procedures, algorithms, or rules) to solve the problem, often ignoring the incentive properties. In this thesis I take a different approach, that is, to look at a large class of mechanisms and to determine the conditions necessary to induce mechanisms with desired optimality and incentive properties. This analytic technique is augmented by an experimental examination of some of the mechanisms that have been proposed to solve this problem. Mechanisms that use transfers and consider incentive properties exist in the literature, but mechanisms that do not use transfers do not. None of these mechanisms has been tested or compared. The thesis is divided into two chapters; in chapter I, I examine the class of nontransfer dominant and Nash strategy mechanisms, and in chapter II, I discuss the experimental tests of the known transfer mechanisms and of the nontransfer mechanisms discussed in chapter I.
\r\n\r\nIn the first chapter of this thesis, I characterize the conditions necessary for a nontransfer mechanism to be implementable in dominant and Nash strategies. This characterization is an extension of the Gibbard-Satterthwaite theorem. One of the conditions, ordinality, explains a distinction that is observed in the mechanisms described in the literature, that is, the use of cardinal information when transfers are used, and the use of ordinal information when transfers are not used. In addition, I apply a little-known concept for strategic behavior, nonbossiness, which is a necessary condition for implementability.
\r\n\r\nIn the second chapter of this thesis, I use experimental methods to explore some procedures that could be used to assign individuals to slots. I look at four mechanisms, two transfer mechanisms, a sealed-bid auction and a progressive auction, and two nontransfer mechanisms, a choice mechanism and a chit mechanism (which are also studied in part I of this thesis). The mechanisms were compared to their theoretical predictions and to each other. For the chit mechanism a genetic algorithm was used to compute the predicted outcome; since this is a new use for the technique, I discuss the methodology that I used.
\r\n\r\nThe experimental results for the transfer auctions are similar to the results found for single and multiple unit auctions; that is, progressive auctions tend to be more efficient and extract higher revenue from the bidders. While the transfer mechanisms studied had the properties that they are efficient and extract surplus (in terms of revenue) from the bidders, nontransfer mechanisms retain most of the surplus for bidders but tend to be less efficient. The difference between the two classes of mechanisms was most apparent in a high-contention environment where the use of nontransfer mechanisms resulted in a much larger surplus to the individual bidders, and the transfer mechanisms resulted in slightly higher efficiencies (the differences in efficiencies were small in comparison to the differences in consumer surplus). In a low-contention environment the use of either a transfer or a nontransfer mechanism had little effect on either the efficiencies or the consumer surplus.
\r\n\r\nThe results of this study are a first step to understanding the assignment problem and to understanding more difficult allocation problems with heterogeneous goods. Two simple results are evident from our results. In the low-contention environment the planner can choose among the mechanisms discussed and not be concerned about their relative merits, since there is little difference in the outcomes of these mechanisms; in the high-contention environment the planner must determine whether efficiency or consumer surplus is more important; if efficiency or revenue is most important then, the progressive auction is clearly superior, if consumer welfare is most important then the chit mechanism is superior.
", "doi": "10.7907/8ZCK-E373", "publication_date": "1991", "thesis_type": "phd", "thesis_year": "1991" }, { "id": "thesis:2761", "collection": "thesis", "collection_id": "2761", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-06282007-094240", "primary_object_url": { "basename": "Lupia_aw_1991.pdf", "content": "final", "filesize": 6935264, "license": "other", "mime_type": "application/pdf", "url": "/2761/1/Lupia_aw_1991.pdf", "version": "v3.0.0" }, "type": "thesis", "title": "The effect of political information on direct democracy strategies and outcomes", "author": [ { "family_name": "Lupia", "given_name": "Arthur William", "clpid": "Lupia-A-W" } ], "thesis_advisor": [ { "family_name": "Ordeshook", "given_name": "Peter C.", "clpid": "Ordeshook-P-C" }, { "family_name": "McKelvey", "given_name": "Richard D.", "clpid": "McKelvey-R-D" } ], "thesis_committee": [ { "family_name": "Ordeshook", "given_name": "Peter C.", "clpid": "Ordeshook-P-C" }, { "family_name": "McKelvey", "given_name": "Richard D.", "clpid": "McKelvey-R-D" }, { "family_name": "Kiewiet", "given_name": "D. Roderick", "clpid": "Kiewiet-D-R" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "The intent of the dissertation is to detail the effects of political information on participant strategies and outcomes in an electoral environment called \"direct democracy.\" Direct democracy is a decision-making institution in which an agenda setter chooses an alternative to a pre-determined Status Quo and voters vote for either the Status Quo or the agenda setter's alternative. Through the use of a spatial election model, a survey of California insurance reform voters, and a series of laboratory experiments, I show how the direct democracy outcome corresponds to the underlying preferences of a majority of the electorate. The spatial model is used to establish that under conditions of incomplete information, the direct democracy outcome corresponds to the (full information) wishes of a majority of the electorate only when there are sufficient opportunities to cue off of the actions of other, credible, electoral participants. The empirical tools and experiments are used to examine electoral environments where different types of information are available. It is established that voters do not require full information in order to vote for their full information preferred alternative. It is also established that, in the absence of certain types of information, rational voters can cast votes for alternatives that lead to their least preferred outcome.\n\nThat voters do not require full information in order to vote for their full information preferred alternative suggests that voters do not necessarily need to understand an issue to vote in their own best interest. That rational voters can cast \"ex post mistaken\" votes under conditions of incomplete information implies that direct democracy outcomes can be manipulated by well-endowed interests. The dissertation details the conditions under which each of these outcomes is likely to occur.", "doi": "10.7907/rxpx-pg64", "publication_date": "1991", "thesis_type": "phd", "thesis_year": "1991" }, { "id": "thesis:2559", "collection": "thesis", "collection_id": "2559", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-06122007-082704", "primary_object_url": { "basename": "Guler_k_1990.pdf", "content": "final", "filesize": 5898031, "license": "other", "mime_type": "application/pdf", "url": "/2559/1/Guler_k_1990.pdf", "version": "v3.0.0" }, "type": "thesis", "title": "Pre-auction investment and equivalence of auctions", "author": [ { "family_name": "Guler", "given_name": "Kemal", "clpid": "Guler-K" } ], "thesis_advisor": [ { "family_name": "McKelvey", "given_name": "Richard D.", "clpid": "McKelvey-R-D" } ], "thesis_committee": [ { "family_name": "McKelvey", "given_name": "Richard D.", "clpid": "McKelvey-R-D" }, { "family_name": "Plott", "given_name": "Charles R.", "clpid": "Plott-C-R" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Palfrey", "given_name": "Thomas R.", "clpid": "Palfrey-T-R" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "In this thesis we investigate some extensions of game theoretic auction models and models of R&D by allowing the participants' cost of producing an indivisible object to be determined by their R&D decisions prior to the auctioning of a fixed price production contract. We establish that when the production cost distributions are endogenously determined as a result of private investment expenditures which are only privately observable, first and second price auctions are equivalent: both give rise to the same level of total investment, same reserve price, same expected price to the buyer and same expected level of profits for the sellers, at the symmetric Nash equilibria. This is an extension of the equivalence results known in the context of standard independent private value auction models with risk neutral bidders. We also show using a discrete cost model that, when investment is observable, the requirement of subgame perfection eliminates the symmetric investment equilibrium from the set of equilibria in pure strategies, and the only pure strategy equilibria are asymmetric. The buyer's optimal response to this asymmetry in the investment equilibria is to reduce her reserve price so that equilibrium total investment level is lower when the buyer knows that the sellers know one another's investment levels. We also consider ex ante incentives to collude under first and second price auctions and find that equilibrium patterns of collusion differ significantly. Finally, we report some experimental results.", "doi": "10.7907/737d-qj73", "publication_date": "1990", "thesis_type": "phd", "thesis_year": "1990" }, { "id": "thesis:1950", "collection": "thesis", "collection_id": "1950", "cite_using_url": "https://resolver.caltech.edu/CaltechETD:etd-05222007-095847", "type": "thesis", "title": "Efficiency and Stability in Partnerships", "author": [ { "family_name": "Legros", "given_name": "Patrick", "clpid": "Legros-Patrick" } ], "thesis_advisor": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Kiewiet", "given_name": "D. Roderick", "clpid": "Kiewiet-D-R" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Kiewiet", "given_name": "D. Roderick", "clpid": "Kiewiet-D-R" }, { "family_name": "Border", "given_name": "Kim C.", "orcid": "0000-0003-4437-0524", "clpid": "Border-K-C" }, { "family_name": "McKelvey", "given_name": "Richard D.", "clpid": "McKelvey-R-D" }, { "family_name": "Palfrey", "given_name": "Thomas R.", "orcid": "0000-0003-0769-8109", "clpid": "Palfrey-T-R" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "A partnership is an organization in which the owners of the firm provide inputs into the production process and in which they have, collectively, the power to make decisions. An institution defines how the output of the partnership is shared among the partners and also the collective decision process that will be used. An institution should have two desirable properties: efficiency and stability. Efficiency means that the partners have an incentive to provide efficient levels of inputs (the moral hazard problem) and that the decision process selects an efficient decision. Stability means that the partners do not want to modify the institution (renegotiation proofness).
\r\n\r\nWhen the inputs that the partners provide are not verifiable, there is a well established belief in the literature that efficiency cannot be sustained in partnerships. The first part of the dissertation establishes, contrary to this common belief, that the moral hazard problem can be almost eliminated in partnerships: there exists an allocation of the final output which induces each partner to almost always take an efficient action. It is in fact sometimes possible for the partners to attain full efficiency: necessary and sufficient conditions are established.
\r\n\r\nThe second part of the thesis considers a situation in which renegotiation takes place through a mediator. It is shown that, under some sufficient conditions on the environment, there exist collective decision making processes which are (interim) efficient and which are renegotiation proof, i.e., stable.
", "doi": "10.7907/twmw-b767", "publication_date": "1989", "thesis_type": "phd", "thesis_year": "1989" }, { "id": "thesis:7833", "collection": "thesis", "collection_id": "7833", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:06042013-140546131", "type": "thesis", "title": "The Federal Photovoltaics Commercialization Program", "author": [ { "family_name": "Pegram", "given_name": "William Manson", "clpid": "Pegram-William-Manson" } ], "thesis_advisor": [ { "family_name": "Reinganum", "given_name": "Jennifer F.", "clpid": "Reinganum-Jennifer-F" } ], "thesis_committee": [ { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Davis", "given_name": "Lance E.", "clpid": "Davis-L-E" }, { "family_name": "Dubin", "given_name": "Jeffrey A.", "clpid": "Dubin-J-A" }, { "family_name": "Kiewiet", "given_name": "D. Roderick", "clpid": "Kiewiet-D-R" }, { "family_name": "Noll", "given_name": "Roger G.", "clpid": "Noll-R-G" }, { "family_name": "Reinganum", "given_name": "Jennifer F.", "clpid": "Reinganum-Jennifer-F" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "The dissertation presents a political and economic history of the federal government's program to commercialize photovoltaic energy for terrestrial use. Chapter 1 is a detailed history of the program. Chapter 2 is a brief review of the Congressional roll call voting literature. Chapter 3 develops PV benefit measures at the state and Congressional district level necessary for an econometric analysis of PV roll call voting. Chapter 4 presents the econometric analysis.
\r\n\r\nBecause PV power was considerably more expensive than conventional power, the program was designed to make PV a significant power source in the long term, emphasizing research and development, although sizeable amounts have been spent for procurement (direct government purchases and indirectly through tax credits). The decentralized R and D program pursued alternative approaches in parallel, with subsequent funding dependent on earlier progress. Funding rose rapidly in the 1970s before shrinking in the 1980s. Tax credits were introduced in 1978, with the last of the credits due to expire this year.
\r\n\r\nMajor issues in the program have been the appropriate magnitude of demonstrations and government procurement, whether decentralized, residential use or centralized utility generation would first be economic, the role of storage in PV, and the role of PV in a utility's generation mix.
\r\n\r\nRoll call voting on solar energy (all votes analyzed occurred from 1975-1980) was influenced in a cross-sectional sense by all the influences predicted: party and ideology, local economic benefits of the technology, local PV federal spending and manufacturing, and appropriations committee membership. The cross-sectional results for ideology are consistent with the strongly ideological character of solar energy politics and the timing of funding increases and decreases discussed in Chapter 1. Local PV spending and manufacturing was less significant than ideology or the economic benefits of the technology. Because time series analysis of the votes was not possible, it is not possible to test the role of economic benefits to the nation as a whole.
", "doi": "10.7907/vsaa-th63", "publication_date": "1989", "thesis_type": "phd", "thesis_year": "1989" }, { "id": "thesis:11463", "collection": "thesis", "collection_id": "11463", "cite_using_url": "https://resolver.caltech.edu/CaltechTHESIS:04152019-112738556", "type": "thesis", "title": "Signaling Games: Theory and Applications", "author": [ { "family_name": "Banks", "given_name": "Jeffrey Scot", "clpid": "Banks-Jeffrey-Scot" } ], "thesis_advisor": [ { "family_name": "McKelvey", "given_name": "Richard D.", "clpid": "McKelvey-R-D" } ], "thesis_committee": [ { "family_name": "McKelvey", "given_name": "Richard D.", "clpid": "McKelvey-R-D" }, { "family_name": "Ledyard", "given_name": "John O.", "clpid": "Ledyard-J-O" }, { "family_name": "Sobel", "given_name": "Joel", "clpid": "Sobel-Joel" }, { "family_name": "Wilde", "given_name": "Louis L.", "clpid": "Wilde-L-L" } ], "local_group": [ { "literal": "div_hss" } ], "abstract": "This thesis concerns the interactions between asymmetrically informed agents where information can potentially be transmitted through the actions of the agents. Refinements of the sequential equilibrium concept are derived and applied to (i) a model of pretrial bargaining between litigants to a civil suit, where both parties possess private information, and (ii) a model of electoral competition where the voters attempt to deduce the private information held by the candidates.
", "doi": "10.7907/hhm5-8h24", "publication_date": "1986", "thesis_type": "phd", "thesis_year": "1986" } ]