Theoretical Economics

Keeping players in the dark about past outcomes opens new contractual possibilities in repeated agency problems and games. But can it accelerate convergence to efficiency when players are patient? This paper shows that it cannot https://t.co/iVaZv18UpI https://t.co/R92jiZYfo1

Traditional mechanism design ensures equilibrium outcomes are desirable. But what if agents make mistakes or the designer has limited commitment? Safe Implementation considers restricting off equilibrium outcomes in a full implementation setting https://t.co/C1nTkDFpmv https://t.co/7XLt1TRQzZ

Do more correlated signals lead to greater commonality of beliefs? In a standard common learning model, we identify when the opposite is true. Even conditionally independent signals may lead to greater commonality of beliefs than correlated ones https://t.co/TsaL16iLqA https://t.co/xA2sNsjlcS

Verification is never perfect. Here’s a new framework for probabilistic verification in mechanism design. The principal chooses which test to give the agent. We reduce this to simpler problem, and we solve it using the first-order approach https://t.co/3m6U85Yibw https://t.co/WthCp4w1UX

Theoretical Economics Volume 20, Issue 1 (January 2025) is now online https://t.co/LT8bO4sxxp https://t.co/M0jkxjKp1c

Extending the 2-country tax competition framework with cross-border shopping to 3 countries and a general spatial population distribution, the population distribution within countries matters for the order of tax rates in equilibrium. @DavidRAgrawal https://t.co/UoyACsVTMF https://t.co/cMhERkNJY8

In many-to-one matching markets without transfers, cutoff scores play a similar role as prices. What happens in decentralized markets when schools update cutoffs on basis of demand-supply imbalances? https://t.co/Yskapmvmns https://t.co/lbkfE0x6DG

How to explore alternatives when their utilities are correlated? The paper shows that optimal experimentation follows a threshold structure, and exploration accelerates in response to poor outcomes in prior experimentation https://t.co/WPVJ2Z89CY https://t.co/RkpEuQTniA

How can priority services balance efficiency, revenue, and congestion in frictional markets? This article explores the welfare impact of the priority search programs, revealing their potential to achieve optimal market participation https://t.co/Wx2JpsuNZL https://t.co/0T1N4p8OzV

What contracts should a principal offer when there are multiple agents? This paper shows that a relatively pessimistic principal should offer “weight-ranked divide-and-conquer contracts.” https://t.co/mxSMCZa29R