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This thesis studies the importance and implications of information asymmetry in decentralized markets with search frictions. The first chapter provides an introduction and literature review. In the next chapter, I propose a model of the housing market using a search framework in which sellers are unable to commit to asking prices announced ex ante. Relaxing the commitment assumption prevents sellers from using price posting as a signalling device to direct buyers' search. Adverse selection and inefficient entry on the demand side then contribute to housing market illiquidity. Real estate agents that can facilitate the search process can segment the market and alleviate information frictions. In Chapter 3, I further study the importance and implications of the commitment assumptions embedded in directed search models. I eliminate commitment to take-it-or-leave-it trading mechanisms in a model of the labour market with worker heterogeneity and a matching process that allows for multiple firms to match with a single worker. When workers and firms cannot commit to ex ante offers, to an allocation rule, or to an ex post bargaining strategy, the equilibrium is necessarily inefficient. This is true for a broad class of protocols for wage determination, of which bilateral bargaining and Bertrand competition are special cases. Finally, Chapter 4 presents a theory of land market activity for settings where there is uncertainty and private information about the security of land tenure. Land sellers match with buyers in a competitive search environment, and an illiquid land market emerges as a screening mechanism. The implications of the theory are tested using household level data from Indonesia. As predicted, formally titled land is more liquid than untitled land in the sense that ownership rights are more readily transferable. / Thesis (Ph.D, Economics) -- Queen's University, 2012-10-09 22:03:23.045

The first chapter addresses a common presumption in organisational design that employees should not be given discretion about performance measures when offered performance pay. The concern is that they would make a self-serving choice, for example, one that allows them to boost their apparent performance by working on tasks which they find easy but bring little benefit to the company. I investigate this problem in a model in which the principal decides whether to delegate the choice of performance measure to an agent who is privately informed about the degree of substitutability of his effort on different tasks. I show that when the principal is using menus of contracts as a screening device, allowing the agent to choose his performance measure privately - and possibly in a self-serving way - can alleviate the problem of hidden information. Consequently, delegating the choice of performance measure can be complementary to provision of incentives and may increase the principal's payoff. The second chapter analyses the incentives of authoritarian regimes to manipulate information by adding noise to the citizens' information, which is a tactic that is increasingly common in the real world. I consider a global games model in which a regime controls the amount of noise in the citizens' private information and is overthrown if enough citizens attack it. The analysis sheds light on recent findings in political science which show that the Chinese regime uses censorship to prevent collective action rather than criticism of the state per se, and that it employs social media commentators to distract the citizens rather than to persuade them. I show that the better the citizens are informed about the regime, the more its incentives to add noise are driven by the criticism of the state rather than by the need to minimise the size of collective attacks. Furthermore, the incentives to add noise may become stronger if citizens' better coordination comes at the cost of impeded information aggregation. The third chapter, which is co-authored with Bartosz Redlicki (University of Cambridge), studies a game between a biased sender (an interest group) and a decision maker (a policy maker) where the former can falsify scientific evidence at a cost. The sender observes scientific evidence and knows that it will also be observed by the decision maker unless he falsifies it. If he falsifies, then there is a chance that the decision maker observes the falsified evidence rather than the true scientific evidence. First, we investigate the decision maker's incentives to privately acquire independent evidence, which not only provides additional information to her but can also strengthen or weaken the sender's falsification effort. We characterise the circumstances under which the benefit from the additional information is boosted, unaffected, dampened, and fully offset by the adjustment in the sender's falsification strategy. Second, we analyse the decision maker's incentives to acquire information from the sender. We show that she may be better off by committing to pay less than full attention to the sender as this can discourage falsification.

This thesis employs models of homogenous and differentiated products to empirically investigate the demand for mobile phone services in Sub-Saharan African countries. The thesis consists of a short introductory chapter, three self-contained empirical chapters, and a summary chapter. In Chapter 2, we use survey data conducted in 2011 in eleven countries in Sub-Saharan African to analyze how the availability of physical infrastructure influences the adoption of mobile phones and usage of mobile services. The availability of physical service infrastructure is approximated by data on night-time light intensity in the areas in which survey respondents reside. After controlling for a number of individual and household characteristics including disposable income, we find that adoption of mobile phones is higher in areas with better physical infrastructure. However, in the group of mobile phone adopters, the use of mobile phones for mobile financial transactions is negatively influenced by the level of infrastructure. Mobile phone users who live in areas with poor infrastructure are more likely to rely on mobile phones to make financial transactions than individuals living in areas with better infrastructure. On the other hand, the use of mobile phones to access services such as email, skype, social media networks and Internet browsing is not dependent on the availability of physical infrastructure. Our results support the notion that mobile phones improve the livelihoods of individuals residing in remote areas by providing them with access to financial services which are otherwise not available physically. Chapter 3 examines the effect of mobile number portability (MNP) on own- and cross-price elasticities. Using quarterly data for 28 mobile operators in seven Sub-Saharan Africa countries between 2010Q4 to 2014Q4 to estimate a differentiated products demand model, we find that MNP increased own-price elasticities of demand in countries that have implemented the facility. This increase in price elasticities may be a result of a reduction in switching costs between operators. On average, the introduction of MNP increases own-price elasticities by 0.47 in absolute value. We compare the level of price elasticities before and after the implementation of MNP in Ghana and Kenya, which implemented this policy in the time period of our study. Our results suggest that in Ghana, MNP increased own-price elasticities by an average of 0.35 in absolute terms from an average value across firms and over time of -0.74. In Kenya, the introduction of MNP increased own-price elasticities by an average of 0.21 in absolute terms from a lower average value across firms and over time of -0.39. However, we find that in Kenya and Ghana the average own-price elasticities remained small even after the implementation of MNP relative to other countries without MNP in place. Thus, our results suggest that MNP is not the ultimate solution for increasing competitiveness within the mobile industry. While in Chapter 3 we use a product differentiated model of demand, in Chapter 4 we make assumptions that allow us to use a homogenous model of demand to examine the effect of regulatory policies on mobile retail prices. Using aggregated quarterly data for eight African countries for the period 2010:Q4 to 2014:Q4, we estimate structural demand and supply equations. We find that mobile termination rates (MTR) have a significant positive impact on mobile retail prices. A decline in average MTR of 10% decreases average mobile retail prices by 2.5%. On the other hand, MNP has an insignificant effect on price and subscriptions in selected African countries. This may be due to inadequate implementation of MNP, which subsequently lead to low demand for porting numbers. The average market conduct in the mobile telecommunications industry for selected African countries can be approximated by Cournot Nash equilibrium. In Chapter 4 we find price elasticities that are closer to 1 in absolute terms. The price elasticity, however, is estimated at an average of -0.27 for Sub-Saharan Africa countries in Chapter 4. We attribute this inconsistency to the different assumptions made in each chapter.

Thesis "Information economics and its potential in education of information specialists" aims to define the basic assumptions and concepts of this area of human knowledge, to analyze the state of the information economics teaching at universities in the Czech Republic. Moreover, selected topics that are currently being discussed in the professional community are presented. The work describes the information and communication technology, development of economics itself, asymmetry of information, electronic business and commerce, the role of information in the economy, organizational hierarchy problems in the context of information economics, information-technology paradigm and influence of information on society. This theoretical part is then transferred into an electronic learning course. This course can serve to educate information specialists. The work also includes a survey of the information economy teaching at universities in the Czech Republic and research on this subject at universities worldwide.

This thesis consists of three chapters in microeconomic theory concerning strategic interactions among parties with asymmetric information. The first chapter, ''Cheap Talk with Private Signal Structure" (co-authored with Maxim Ivanov) and published in Games and Economic Behavior, Volume 132 (2022), pages 288-304, addresses the question of how a designer of information --- which is privately observed by other players --- can benefit from designing it privately. The second chapter, ''Multidimensional Signaling with a Resource Constraint" (co-authored with Seungjin Han), studies competitive monotone equilibria in a multidimensional signaling economy where senders invest in their multidimensional signals (cognitive and non-cognitive) while facing a resource constraint. The third chapter, ''Consumer Privacy Disclosure in Competitive Markets", studies how competition among multi-product sellers with market power shapes the implications of consumer privacy on market outcomes. / Thesis / Doctor of Philosophy (PhD)

This dissertation investigates agency problems within risk transfer contracts. We pay particular attention to the consequences of credit risk transfer in the context of banking. The first two chapters provide an introduction and literature review. We then analyze the effect of counterparty risk on financial insurance contracts in the following two chapters, and uncover a new moral hazard problem on the part of the insurer. If the insurer believes it is unlikely that a claim will be made, it is advantageous for them to invest in assets which earn higher returns, but may not be readily available if needed. We find that counterparty risk can create an incentive for the insured to reveal superior information about the risk of their "investment". In particular, a unique separating equilibrium may exist even in the absence of any signalling device. This constitutes a first example in which the separation of types can be achieved without a costly signalling device. Our research suggests that regulators should be wary of risk being offloaded to other, possibly unstable parties, especially in financial markets such as that of credit derivatives. The fifth chapter models loan sales and loan insurance (e.g. credit default swaps) as two key instruments of risk transfer within the banking environment. Recent empirical evidence suggests that the asymmetric information problem is as relevant in loan insurance as it is in loan sales. Contrary to previous literature, this paper allows for informational asymmetries in both markets. Our results show that a well capitalized bank will tend to use loan insurance regardless of loan quality in the presence of moral hazard and relationship banking costs of loan sales. Finally, we show that a poorly capitalized bank may be forced into the loan sales market, even in the presence of possibly significant moral hazard and relationship banking costs that can depress the selling price. / Thesis (Ph.D, Economics) -- Queen's University, 2008-09-26 13:03:32.81

Thesis advisor: Michael Grubb / Online reviews have gained importance for consumers when shopping for experience goods. This dissertation documents the impact of Tripadvisor.com reviews on the hotel industry. In the first chapter, I investigate the causal impact of Tripadvisor review ratings on hotel performance via a regression discontinuity design. The results indicate that a 1-point increase in review rating leads to a 1.6% increase in revenue, a 1% increase in bookings, and a 0.4% to 0.6% increase in prices. Furthermore, the impact on bookings has increased over time. In the second chapter, I evaluate the welfare impact of Tripadvisor review ratings in providing information about quality. I develop a structural model of hotel demand and supply that takes price endogeneity and capacity constraints into consideration. Counterfactual experiments reveal that the removal of Tripadvisor from the status quo results in per-capita consumer surplus loss ranging from $0 to $5.8, with a more significant decrease in consumer surplus when prior knowledge about quality is less accurate. Hotels with higher quality than expected absent reviews benefit from review ratings, while the opposite is true for others. In the third chapter, I analyze the relative influence of Tripadvisor ratings on chain-affiliated and independent hotels and evaluate the value of Tripadvisor ratings compared to chain brands using the methodology developed in previous chapters. I find there is no significant difference in the effect of rating rounding on occupancy rates for chain-affiliated hotels versus independent hotels. Counterfactual experiment results suggest that despite chain brands providing value to consumers, Tripadvisor ratings provide additional value of about $0 to $4 per capita. In scenarios where Tripadvisor was not present, Chain-affiliated hotels benefit from brand affiliation while independent hotels are harmed. / Thesis (PhD) — Boston College, 2023. / Submitted to: Boston College. Graduate School of Arts and Sciences. / Discipline: Economics.

An important element of successful engineering design is the effective management of resources to support design decisions. Design decisions can be thought of as having two phasesa formulation phase and a solution phase. As part of the formulation phase, engineers must decide how much information to collect and which models to use to support the design decision. Since more information and more accurate models come at a greater cost, a cost-benefit trade-off must be made. Previous work has considered such trade-offs in decision problems when all aspects of the decision problem can be represented using precise probabilities, an assumption that is not justified when information is sparse. In this thesis, we use imprecise probabilities to manage the information cost-benefit trade-off for two decision problems in which the quality of the information is imprecise: 1) The decision of when to stop collecting statistical data about a quantity that is characterized by a probability distribution with unknown parameters; and 2) The selection of the most preferred model to help guide a particular design decision when the model accuracy is characterized as an interval. For each case, a separate novel approach is developed in which the principles of information economics are incorporated into the information management decision. The problem of statistical data collection is explored with a pressure vessel design. This design problem requires the characterization of the probability distribution that describes a novel material's strength. The model selection approach is explored with the design of an I-beam structure. The designer must decide how accurate of a model to use to predict the maximum deflection in the span of the structure. For both problems, it is concluded that the information economic approach developed in this thesis can assist engineers in their information management decisions.

In this thesis, a framework is laid for holistic uncertainty management for simulation-based design of multiscale systems. The work is founded on uncertainty management for microstructure mediated design (MMD) of material and product, which is a representative example of a system over multiple length and time scales, i.e., a multiscale system. The characteristics and challenges for uncertainty management for multiscale systems are introduced context of integrated material and product design. This integrated approach results in different kinds of uncertainty, i.e., natural uncertainty (NU), model parameter uncertainty (MPU), model structure uncertainty (MSU) and propagated uncertainty (PU). We use the Inductive Design Exploration Method to reach feasible sets of robust solutions against MPU, NU and PU. MMD of material and product is performed for the product autonomous underwater vehicle (AUV) employing the material in-situ metal matrix composites using IDEM to identify robust ranged solution sets. The multiscale system results in decision nodes for MSU consideration at hierarchical levels, termed as multilevel design. The effectiveness of using game theory to model strategic interaction between the different levels to facilitate decision making for mitigating MSU in multilevel design is illustrated using the compromise decision support problem (cDSP) technique. Information economics is identified as a research gap to address holistic uncertainty management in simulation-based multiscale systems, i.e., to address the reduction or mitigation of uncertainty considering the current design decision and scope for further simulation model refinement in order to reach better robust solutions. It necessitates development of an improvement potential (IP) metric based on value of information which suggests the scope of improvement in a designer's decision making ability against modeled uncertainty (MPU) in simulation models in multilevel design problem. To address the research gap, the integration of robust design (using IDEM), information economics (using IP) and game theoretic constructs (using cDSP) is proposed. Metamodeling techniques and expected value of information are critically reviewed to facilitate efficient integration. Robust design using IDEM and cDSP are integrated to improve MMD of material and product and address all four types of uncertainty simultaneously. Further, IDEM, cDSP and IP are integrated to assist system level designers in allocating resources for simulation model refinement in order to satisfy performance and robust process requirements. The approach for managing MPU, MSU, NU and PU while mitigating MPU is presented using the MMD of material and product. The approach presented in this article can be utilized by system level designers for managing all four types of uncertainty and reducing model parameter uncertainty in any multiscale system.