To understand what the future requirements of education are to be, one must examine education from a new perspective. One of the keys in understanding that the challenge facing education is recognizing that it is, in fact, a tool of the industrial world and is therefore tied to its capitalistic economic vision. The vision for the future is one in which the new world order is based on an age of ideas and information. Institutions of education have, over the years, evolved and emerged as the primary force in the transmittal of ideas. In this process of transmittal, it assigns value to those ideas which further the interest, goals, and means of western economics (capitalism). Future policy issues should address global economic concerns. Education must take into consideration the role that economics plays in the development of its curriculum. Furthermore, it must assume a position of leadership in the information age, where the validity of ideas will drive economy.

Many markets exhibit substantial heterogeneity -- e.g.~in ability, in preferences, in products, in strategies. Allowing for this (sometimes multi-dimensional) heterogeneity can change both the theoretical predictions of models and the results of empirical analyses. This dissertation consists of three essays on markets and games with different forms of heterogeneity. The first chapter introduces preference heterogeneity and multi-dimensional skill heterogeneity into the analysis of labor markets. In matching markets, agents have heterogeneous preferences over potential partners, so welfare depends on which agents are matched to each other in equilibrium. Taxes in matching markets can generate inefficiency by changing who is matched to whom, even if the number of workers at each firm is unaffected. This ``allocative distortion'' is not evident in traditional models of income taxation that do not allow for workers to have multi-dimensional preference and productivity heterogeneity. For markets in which workers refuse to match without a positive wage, higher taxes decrease match efficiency. However, in more balanced matching markets where transfers may flow in either direction, such as the student--college market, lowering taxes may decrease match efficiency because an agent can transfer enough to ``buy'' an inefficient partner (only to be ``bought back'' when taxes are lowered further). Simulations show that, in matching markets, traditional deadweight loss estimates based on the change in taxable income can be substantially biased in either direction. The second chapter builds on the merger analysis literature that recognizes the importance of product heterogeneity. Both merger simulations and the more recent ``first-order'' approach to merger analysis recognize that because product heterogeneity can vary, market concentration is not always a good measure of the competitiveness of the market. We derive approximations of the expected changes in prices and welfare generated by a merger, using information local to the pre-merger equilibrium. We extend the pricing pressure approach of recent work to allow for non-Bertrand conduct, adjusting the diversion ratio and incorporating the change in anticipated accommodation. To convert pricing pressures into quantitative estimates of price changes, we multiply them by the merger pass-through matrix. Pass-through rates can vary by industry and the same pricing pressure can lead to very different price changes, depending on the pass-through rates. Weighting the price changes by quantities gives the change in consumer surplus. The third chapter uses data on thousands of players who play a game over a hundred times to do a with-in player analysis of play and allow for heterogeneity in the mixed strategies that players use. We use of data from a Facebook application where users play a simultaneous move, zero-sum game -- rock-paper-scissors -- with varying information to provide empirical insights into whether play is consistent with extant theories. We report three major insights. First, we observe that many employ strategies consistent with Nash, at least some of the time. Second, players predictably respond to incentives in the game. For example, out of equilibrium, players strategically use information on previous play of their opponents, and they are more strategic when the payoffs for such actions increase. Third, experience matters: players with more experience use information on their opponents more efficiently than less experienced players, and are more likely to win as a result. We also explore the degree to which the deviations from Nash predictions are consistent with various non-equilibrium models. We find that both a level-k framework and a quantal response model have explanatory power: whereas one group of people employ strategies that are close to $k_1$, there is also a set of people who use strategies that resemble quantal response. / Economics

This dissertation contains essays that explore the incentives, mechanisms and strategies of platforms in concentrated internet markets. The first essay studies how two-sided platforms compete and set dynamic prices. In the daily deals industry, an expected increase in competition for seller participation prompted a cross-side response by the dominant platform, Groupon, to lower prices on deal coupons sold to attract platform users. I use a dynamic model of competing daily deals platforms to investigate why we observe a larger downward price response in markets where platforms have similar shares of users. Simulations show a sharp increase in value of an additional user as cross-side competition intensifies for profits from being the future platform leader. The second essay---coauthored with Benjamin G. Edelman---examines how competition is mediated by search intermediaries, looking at the design of search engines' own services and the effects on users' choices. We evaluate a natural experiment, and find that Google's prominent placement of its Flight Search service increased clicks on paid advertising listings while decreasing the clicks on organic search listings by a similar quantity. Empirical results and a controlled experiment links the mechanism to users' heterogeneous methods of search. The third essay---coauthored with Michael Egesdal and Che-Lin Su---develops empirical tools for estimating dynamic discrete-choice games. We formulate the maximum-likelihood estimator as a constrained optimization problem to be solved using state-of-the-art constrained optimization solvers. Monte Carlo results show that the constrained optimization approach has improved convergence properties over other popular computational methods. / Economics

Motivated by policy debates emerging from the U.S. Great Recession and Eurozone crisis, I study the stabilization role of monetary, fiscal, and macroprudential policies in response to short-run fluctuations. In the first essay on "Unemployment Insurance in Macroeconomic Stabilization", I characterize the role of unemployment insurance (UI) generosity as a particular instrument of fiscal policy, and use my framework to quantitatively evaluate the employment and welfare effects of UI extensions in the U.S. over 2008-13. In the second essay on "Labor Market Frictions in a Monetary Union", I study stabilization trade-offs and optimal monetary policy in a monetary union where labor markets are frictional and heterogeneous across member states, with implications for the sustainability of the Euro and policy of the ECB. In the third essay on "Firm vs. Bank Leverage over the Business Cycle", I develop a general equilibrium model explaining the contrasting cyclical behavior of non-financial corporate and bank leverage in U.S. data, and study its implications for macroprudential regulation in banking. Methodologically, these essays share a focus on building theoretical models of closed and open economies to address policy-relevant questions in macroeconomics, drawing on additional ideas from related fields such as public economics and finance. / Business Economics

Abstract not available.

Abstract not available.

From a controversial genesis in the 1960s the theory of human capital has acquired a role of critical importance in the economic development of human beings and nations. A major development in the human capital literature initiated by Becker and Chiswick (1966) and carried to full fruition by Mincer (1974) was the development of a simple empirical framework which captured the key ingredients of the human capital model. Although ingenious and practical, Mincer's formulation has several shortcomings. Among these are, ignoring self-selection and the endogeneity of schooling and ignoring the role of school quality Notwithstanding these shortcomings, the human capital earnings function has been widely used to estimate rates of return to education. Partly on the basis of high rates of return to education, many developing countries have invested heavily in their education sectors. However, although the vacuum is slowly being filled, the evidence on how rates of return to education have fared subsequent to the growth of the education sector is surprisingly sparse These three issues, that is, the inability of the human capital earnings function to account for the self-selection behavior of individuals, changes in the rate of return to education over time, and the role of school quality in determining earnings, form the focus of this dissertation. While these issues are important for all countries this dissertation analyzes these three issues in the context of Honduras, a poor developing country. The dissertation combines recently collected high quality data household data with data on school quality to create a unique set of data which allows us to explore the three issues raised above in detail Chapter one provides rates of return to education that allow for the endogeneity of schooling attainment. The results reveal that ignoring these effects leads to a substantial understatement of rates of return to schooling. Chapter one section five examines the effect of educational expansion on the rates of return to education. There is an increase in educational returns for men who enter the labor market in the 1980s. This is unexpected due to the massive educational expansion in Honduras, which is expected to reduce the marginal returns to schooling. A number of factors that may explain the higher returns are evaluated. It seems that the emergence of a stable political climate, economic reforms and increases in skill-enhancing labor demand are the most likely explanations Chapter two and chapter three address an apparently straightforward question that has received little attention in developing countries. Does school quality have a significant impact on earnings? Household survey data is combined with unique data on school quality to answer this question. The results display strong effects of school quality on earnings, with the strongest impact occurring at the lower percentiles of the income distribution. These effects persist across a variety of model specifications / acase@tulane.edu

No description available.

No description available.

Human capital has long been recognized as a crucial determinant of economic development. The main contribution of my dissertation is to both theoretically and empirically demonstrate the idea that the composition (different types of education) of human capital determines technological progress and affects long-run economic growth. As compared to traditional human capital and growth literature, it emphasizes the composition effect of human capital, rather than the level effect, on economic development. It provides a new perspective in characterizing the stages of economic development along the growth path. Optimal human capital composition benefits not only lesser developed countries who usually lack educational resources but also developed countries with limited population growth potential. The first chapter, titled ``Education, Technology, Human Capital Composition and Economic Development'', develops a framework of endogenous educational decisions and technological progress to explore the human capital composition and its effects on economic growth. In this model, growth is driven by technological advancement, which depends on the human capital composition. Individuals can choose from different types of workers: unskilled workers, generalists or specialists. Both generalists and specialists, through technological progress, are able to enhance growth. The model considers the role of technology stock, coordination cost, education cost and worker's innate ability on the human capital composition and economic growth. The main result shows the improvement in the composition of human capital promotes economic growth in most economic stages. However, this positive effect tapers off as the economy reaches complete specialization. This provides a possible explanation for the convergence of economic growth to zero asymptotically in the long run. I extend the argument into an open economy framework in the second chapter, titled ``Migration Effects on Home Country's Composition of Human Capital and Economic Development''. This chapter examines migration effects on domestic composition of human capital and economic growth. The net effect of migration depends on two facets. On one hand, the possibility of migration provides incentives for workers to invest in education and consequently increases the fraction of skilled workers in home country's human capital composition. On the other hand, increased population of skilled emigrants hinders the accumulation of human capital. A sufficient condition for beneficial migration is derived: if the ex ante domestic fraction of unskilled worker is relatively high, allowing the home country to achieve faster economic growth with migration. The last chapter, titled ``The Effect of Tertiary Education Composition on Economic Growth'', differentiates types of tertiary education by ISECD levels and empirically investigates their effects on economic growth. I use panel data on a group of 77 countries for the period 1998-2011. In dynamic panel data estimation, a potential endogeneity bias could arise due to the inclusion of lagged dependent variables. Several methods are applied to overcome the issue, such as Anderson-Hsiao estimator, the Difference Generalized Method of Moments estimator and the System Generalized Method of Moments estimator. The study shows a significantly positive relationship between short-cycle tertiary education and real GDP per capita for both developed and developing countries. However, undergraduate and graduate education only positively correlate to economic growth in developed countries. The empirical results are informative for developed countries as well as developing countries. Understanding the contribution of tertiary education in different levels allows them to effectively allocate resources and appropriately integrate it in growth policies. / Economics