2018

1. A. Gomberg, "Revealed Votes", forthcoming in Social Choice and Welfare. 

Resumen:

In this paper I consider choice correspondences defined on a novel domain: the decisions are assumed to be taken not by individuals, but by committees, whose membership is observable and variable. In particular, for the case of two alternatives I provide a full characterization of committee choice structures that may be rationalized with two common decision rules: unanimity with a default and weighted majority.


2. I. Lobato and C. Velasco, "Efficiency Improvements for Minimum Distance Estimation of Causal and Invertible ARMA Model" forthcoming in Economics Letters.

Resumen:

In this note we analyze efficiency improvements over the Gaussian maximum likelihood (ML) estimator for frequency domain minimum distance (MD) estimation for causal and invertible autoregressive moving average (ARMA) models. The analysis complements Velasco and Lobato (2017) where optimal MD estimation, which employs information in higher order moments, is studied for the general possibly non causal or non-invertible case. We consider MD estimation that combines in two manners the information contained in second, third, and fourth moments. We show that for both MD estimators efficiency improvements over the Gaussian ML occur when the distribution of the innovations is platykurtic. In addition, we show that asymmetry alone is not associated with efficiency improvements.


3. E. Gutierrez and K. Teshima, "Abatement Expenditures, Technology Choice, and Environmental Performance: Evidence from Firm Responses to Import Competition in Mexico", forthcoming in Journal of Development Economics.

Resumen:

Abatement expenditures are not the only available tool for firms to decrease emissions. Technology choice can also indirectly affect environmental performance. We assess the impact of import competition on plants' environmental outcomes. In particular, exploiting a unique combination of Mexican plant-level and satellite imagery data, we measure the effect of tariff changes due to free-trade agreements on three main outcomes: plants' fuel use, plants' abatement expenditures, and measures of air pollution around plants' location. Our findings show that import competition induced plants in Mexico to increase energy efficiency, reduce emissions, and in turn reduce direct investment in environmental protection. Our findings suggest that the general technology upgrading effect of any policy could be an important determinant of environmental performance in developing countries and that this effect may not be captured in abatement data.


4. A. Nikandrova and R. Pancs,   "Dynamic Project Selection", Theoretical Economics13, 2018.

Resumen:

We study a normative model of an internal capital market, used by a company to choose between its two devisions’ pet projects. Each project’s value is initially unknown to all but can be dynamically learned by the corresponding division. Learning can be suspended or resumed at any time and is costly. We characterize an internal capital market that maximizes the company’s expected cash flow. This market has indicative bidding by the two divisions, followed by a spell of learning and then firm bidding, which occurs at an endogenous deadline or as soon as either division requests it.


5.  A. Elbittar, A. Gomberg, C. Martinelli and T. Palfrey,   "Ignorance and Bias in Collective Decisions",     forthcoming in Journal of Economic Behavior and Organization (2017).

Resumen:

We study theoretically and experimentally a committee with common interests. Committee members do not know which of two alternatives is the best, but each member can acquire privately a costly signal before casting a vote under either majority or unanimity rule. In the experiment, as predicted by Bayesian equilibrium, voters are more likely to acquire information under majority rule, and attempt to counter the bias in favor of one alternative under unanimity rule. As opposed to Bayesian equilibrium predictions, however, many committee members vote when uninformed. Moreover, uninformed voting is strongly associated with a lower propensity to acquire information. We show that an equilibrium model of subjective prior beliefs can account for both these phenomena, and provides a good overall fit to the observed patterns of behavior both in terms of rational ignorance and biases.


6. P. Evdokimov and U.Garfagnini, " Third-party manipulation of conflict: an experiment", forthcoming in Experimental Economics.

Resumen:

We design a laboratory experiment in which an interested third party endowed with private information sends a public message to two conflicting players, who then make their choices. We find that third-party communication is not strategic. Nevertheless, a hawkish message by a third party makes hawkish behavior more likely while a dovish message makes it less likely. Moreover, how subjects respond to the message is largely unaffected by the third party’s incentives. We argue that our results are consistent with a focal point interpretation in the spirit of Schelling.


7. Debasis Mishra, Tridib Sharma  "A simple budget-balanced mechanism",  Social Choice and Welfare, Volume 50, 2018.

Resumen:

In the private values single object auction model, we construct a satisfactory mechanism - a dominant strategy incentive compatible and budget-balanced mechanism satisfying equal treatment of equals. Our mechanism allocates the object with positive probability to only those agents who have the highest value and satisfies ex-post individual rationality. This probability is at least (1 − 2/n ), where n is the number of agents. Hence, our mechanism converges to efficiency at a linear rate as the number of agents grow. Our mechanism has a simple interpretation: a fixed allocation probability is allocated using a second-price Vickrey auction whose revenue is redistributed among all the agents in a simple way. We show that our mechanism maximizes the utilitarian welfare among all satisfactory mechanisms that allocate the object only to the highest-valued agents.