Past Conferences and Seminars

The Center for Economic Research (Centro de Investigación Económica, CIE) invites you to the seminar of Liran Einav, professor of economics at Stanford University.

New York University

"Should We Ban E-cigarettes? Theory and Evidence".

Electronic cigarettes are one of the most controversial new products of the past decade, due to uncertainty about their health e ects and whether they are primarily a quit aid or a gateway drug for traditional combustible cigarettes. We show that demographics with stronger latent demand for e-cigarettes had steady relative declines in cigarette consumption over 2004-2018 that did not change as e-cigarettes were introduced, suggesting that e-cigarettes had negligible e ects on cigarette consumption. We formalize this intuition in a shift-share econometric strategy that con rms that e-cigarettes are neither complements nor substitutes on average; our con dence intervals rule out that e-cigarettes a ected the 2004-2018 aggregate smoking decline by more than 10 percent in either direction. We carry out a new expert survey to aggregate the state of knowledge about the health e ects of e-cigarettes. There is material disagreement; the average expert believes that e-cigarettes impose externalities and \internalities" (harms to users that they do not correctly perceive) that are 48 and 115 percent as large as those of combustible cigarettes, respectively. We embed these empirical ndings in a behavioral welfare analysis with Monte Carlo simulations to account for uncertainty. Successfully banning e-cigarettes increases expected social welfare, although it decreases welfare in more than 40 percent of parameter draws.

University of Chicago

"Information Hierarchies."

If Anne knows more than Bob about the state of the world, she may or may not know what Bob thinks, but it is always possible that she does. In other words, if the distribution of Anne’s first-order belief is a mean-preserving spread of the distribution of Bob’s first-order belief, we can construct signals for Anne and Bob that induce these distributions of beliefs and provide Anne with full information about Bob’s belief. We establish that with more agents, the analogous result does not hold. It might be that Anne knows more than Bob and Charles, who in turn both know more than David, yet what they know about the state precludes the possibility that Anne knows what Bob and Charles think and that everyone knows what David thinks. More generally, we define an information hierarchy as a partially ordered set and ask whether higher elements having more information about the state always makes the hierarchy compatible with higher elements knowing the beliefs of lower elements. We show that the answer is affirmative if and only if the graph of the hierarchy is a forest. We discuss applications of this result to rationalizing a decision maker’s reaction to unknown sources of information and to information design in hierarchical vs. non-hierarchical organizations.

HSE University

"Privacy Protection: When Does Hiding in Plain Sight Work?" 

We study a model where an individual (celebrity) aims to prevent another individual (journalist) from learning sensitive information about her. The celebrity can pre-commit to an ex-ante level of protection for sensitive information. We show that when full protection is not feasible, such selective protection is complementary to general protection for all nonsensitive information. In particular, when general protection is weak, lax selective protection is optimal. The celebrity may choose to hide sensitive information in plain sight hoping that the journalist would quickly give up the search thinking that, had there been anything sensitive to uncover, he would have found it already.