Economic TheoryPub Date : 2023-10-25DOI: 10.1007/s00199-023-01529-6
Frago Kourandi, Ioannis N. Pinopoulos
{"title":"Vertical contracting between a vertically integrated firm and a downstream rival","authors":"Frago Kourandi, Ioannis N. Pinopoulos","doi":"10.1007/s00199-023-01529-6","DOIUrl":"https://doi.org/10.1007/s00199-023-01529-6","url":null,"abstract":"Abstract Compared to linear tariffs, two-part tariffs are generally perceived as being more efficient since double marginalization is avoided. We investigate the efficiency of two-part tariffs vs. linear tariffs when a vertically integrated firm sells its input also to an independent downstream firm selling a differentiated substitute product. We find that a linear tariff can generate higher consumer surplus and overall welfare than a two-part tariff when the independent downstream firm is rather powerful in negotiating the contract terms, and downstream competition is in prices (Bertrand competition). In that case, the integrated firm makes more profits under a linear tariff than under a two-part tariff. In contrast, under downstream Cournot competition two-part tariffs are always welfare-superior. Under linear demand, we find that, irrespective of the mode of downstream competition and the distribution of bargaining power, the preferred contract type of the integrated firm is always welfare-superior.","PeriodicalId":47982,"journal":{"name":"Economic Theory","volume":"430 4","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-10-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135112712","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Economic TheoryPub Date : 2023-10-17DOI: 10.1007/s00199-023-01526-9
Changyong Han, Bawoo Kim, Youngsub Chun
{"title":"Demand operators and the Dutta–Kar rule for minimum cost spanning tree problems","authors":"Changyong Han, Bawoo Kim, Youngsub Chun","doi":"10.1007/s00199-023-01526-9","DOIUrl":"https://doi.org/10.1007/s00199-023-01526-9","url":null,"abstract":"","PeriodicalId":47982,"journal":{"name":"Economic Theory","volume":"210 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-10-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136032720","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Economic TheoryPub Date : 2023-10-06DOI: 10.1007/s00199-023-01523-y
Craig S. Webb
{"title":"Dynamic preference foundations of expected exponentially-discounted utility","authors":"Craig S. Webb","doi":"10.1007/s00199-023-01523-y","DOIUrl":"https://doi.org/10.1007/s00199-023-01523-y","url":null,"abstract":"Abstract Expected exponentially-discounted utility (EEDU) is the standard model of choice over risk and time in economics. This paper considers the dynamic preference foundations of EEDU in the timed risks framework. We first provide dynamic preference foundations for a time-invariant expected utility representation. The new axioms for this are called foregone-risk independence and strong time invariance. This class of dynamic preferences includes EEDU as a special case. If foregone-risk independence is strengthened to a new condition called conditional consistency, then an EEDU representation results. Alternative approaches for extending exponential discounting axioms to risk are considered, resulting in five new preference foundations of EEDU.","PeriodicalId":47982,"journal":{"name":"Economic Theory","volume":"50 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-10-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"134944270","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Economic TheoryPub Date : 2023-09-21DOI: 10.1007/s00199-023-01519-8
William Dodds
{"title":"Solving multidimensional screening problems using a generalized single crossing property","authors":"William Dodds","doi":"10.1007/s00199-023-01519-8","DOIUrl":"https://doi.org/10.1007/s00199-023-01519-8","url":null,"abstract":"","PeriodicalId":47982,"journal":{"name":"Economic Theory","volume":"2015 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-09-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136153768","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Economic TheoryPub Date : 2023-09-21DOI: 10.1007/s00199-023-01518-9
Jeongwoo Lee, Jaeok Park
{"title":"Signaling through entry in auctions with sequential and costly participation","authors":"Jeongwoo Lee, Jaeok Park","doi":"10.1007/s00199-023-01518-9","DOIUrl":"https://doi.org/10.1007/s00199-023-01518-9","url":null,"abstract":"","PeriodicalId":47982,"journal":{"name":"Economic Theory","volume":"19 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-09-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136153761","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Economic TheoryPub Date : 2023-09-16DOI: 10.1007/s00199-023-01513-0
Pawel Dziewulski, Roy Allen, John Rehbeck
{"title":"Revealed statistical consumer theory","authors":"Pawel Dziewulski, Roy Allen, John Rehbeck","doi":"10.1007/s00199-023-01513-0","DOIUrl":"https://doi.org/10.1007/s00199-023-01513-0","url":null,"abstract":"Abstract We provide a microfoundation to use aggregates (e.g. mean purchases) to evaluate consumer choice data. We study statistical consumer theory where an individual maximizes a preference over distributions of bundles when constrained by a statistic of the distribution (e.g. mean expenditure). We show statistical consumer theory is observationally equivalent to an individual whose preferences depend only on the statistic of the distribution. This means that despite working with distributions, the empirical content of the model only depends on a finite-dimensional statistic. This approach generalizes random quasilinear utility with random income and mean-variance preferences.","PeriodicalId":47982,"journal":{"name":"Economic Theory","volume":"3 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-09-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135304604","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Economic TheoryPub Date : 2023-09-14DOI: 10.1007/s00199-023-01522-z
Eitan Sapiro-Gheiler
{"title":"Persuasion with ambiguous receiver preferences","authors":"Eitan Sapiro-Gheiler","doi":"10.1007/s00199-023-01522-z","DOIUrl":"https://doi.org/10.1007/s00199-023-01522-z","url":null,"abstract":"Abstract I describe a Bayesian persuasion problem where Receiver has a private type representing a cutoff for choosing Sender’s preferred action, and Sender has maxmin preferences over all Receiver type distributions with known mean and bounds. This problem can be represented as a zero-sum game where Sender chooses a distribution of posterior mean beliefs that is a mean-preserving contraction of the prior over states, and an adversarial Nature chooses a Receiver type distribution with the known mean; the player with the higher realization from their chosen distribution wins. I formalize the connection between maxmin persuasion and similar games used to model political spending, all-pay auctions, and competitive persuasion. In both a standard binary-state setting and a new continuous-state setting, Sender optimally linearizes the prior distribution over states to create a distribution of posterior means that is uniform on a known interval with an atom at the lower bound of its support.","PeriodicalId":47982,"journal":{"name":"Economic Theory","volume":"46 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-09-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135488740","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}