Testing strategy-proofness in matching markets: an experimental study. This project seeks to test and improve matching algorithms by investigating the effect of advice on strategy-proofness. Matching algorithms are used to solve allocation problems in designed markets (eg school or house allocation problems). Many of the algorithms employed are strategy-proof: participants never gain from strategising, that is, from lying about their preferences. Strategy-proofness had been seemingly validated b ....Testing strategy-proofness in matching markets: an experimental study. This project seeks to test and improve matching algorithms by investigating the effect of advice on strategy-proofness. Matching algorithms are used to solve allocation problems in designed markets (eg school or house allocation problems). Many of the algorithms employed are strategy-proof: participants never gain from strategising, that is, from lying about their preferences. Strategy-proofness had been seemingly validated by experimental research, but new evidence suggests that participants could be prone to follow wrong advice and therefore lie. In order to improve the performance of designed markets, the project proposes to further test strategy-proofness by investigating how advice can affect truth-telling in strategy-proof algorithms and whether learning can counteract or complement the effect of advice.Read moreRead less
Discovery Early Career Researcher Award - Grant ID: DE140101014
Funder
Australian Research Council
Funding Amount
$349,785.00
Summary
Extending economic design to non-market settings: An experimental study of mechanism design with intention-based preferences. Mechanism design is the engineering side of economic theory, which starts with assumptions regarding human nature and builds economic systems to best maximise efficiency according to these assumptions. This project studies mechanism design in experimental settings where individuals exhibit a desire to be kind to those who have been kind to them and unkind to those who ha ....Extending economic design to non-market settings: An experimental study of mechanism design with intention-based preferences. Mechanism design is the engineering side of economic theory, which starts with assumptions regarding human nature and builds economic systems to best maximise efficiency according to these assumptions. This project studies mechanism design in experimental settings where individuals exhibit a desire to be kind to those who have been kind to them and unkind to those who have not. Such preferences are common in many non-market settings and can have dramatic effects on the efficiency of potential mechanisms. The ultimate goal of this project is to develop applied mechanisms that are robust to heterogeneity in such intention-based preferences and which can be used in bilateral exchange, contract design and many other non-market settings.Read moreRead less
Information Quality in Auctions of Multiple Objects. This project aims at using both theory and laboratory experiments to analyse the formation of prices and the buyers' behaviour at auctions of multiple objects. The study focusses on the comparison of simultaneous auction procedures (in which the objects are sold at once) to sequential auction procedures (in which the objects are sold one after the other) and attention is drawn on the effects of the quality of the buyers' information about the ....Information Quality in Auctions of Multiple Objects. This project aims at using both theory and laboratory experiments to analyse the formation of prices and the buyers' behaviour at auctions of multiple objects. The study focusses on the comparison of simultaneous auction procedures (in which the objects are sold at once) to sequential auction procedures (in which the objects are sold one after the other) and attention is drawn on the effects of the quality of the buyers' information about the assets to be sold on their bidding behaviour and on the seller's revenues. The conduct of laboratory experiments will provide a useful assessment of the theoretical predictions and valuable insights into the effects of buyers' information quality on their bidding behaviour at such markets.Read moreRead less
Discovery Early Career Researcher Award - Grant ID: DE120102640
Funder
Australian Research Council
Funding Amount
$375,000.00
Summary
Behavioural foundations of economic design for an uncertain world. The aim of this project is to incorporate behavioural foundations into mechanism design to improve our understanding of economic institutions in incomplete information environments. To accomplish this goal, it considers a framework where agents have reference-dependent preferences and explores implications of this assumption for economic design.
Discovery Early Career Researcher Award - Grant ID: DE160100104
Funder
Australian Research Council
Funding Amount
$372,000.00
Summary
Mechanism Design with Aftermarket Dynamics. This project aims to design optimal selling policies, allowing for aftermarket dynamics such as resale and inter-buyer competitions. The existence of an aftermarket greatly affects the optimal design of license auctions, procurement, franchising and the like. For instance, when market licenses are auctioned off, incumbent firms may compete fiercely for licenses they do not need simply to keep entrants out. Existing sales designs that overlook such bidd ....Mechanism Design with Aftermarket Dynamics. This project aims to design optimal selling policies, allowing for aftermarket dynamics such as resale and inter-buyer competitions. The existence of an aftermarket greatly affects the optimal design of license auctions, procurement, franchising and the like. For instance, when market licenses are auctioned off, incumbent firms may compete fiercely for licenses they do not need simply to keep entrants out. Existing sales designs that overlook such bidding incentives often underperform in practice. The project aims to examine informational policies that influence buyers’ activities to best suit the seller's objectives. It expects to help regulatory bodies to design more efficient license auctions, provide franchisors with more profitable strategies, and save taxpayers' money when procuring services.Read moreRead less
Discovery Early Career Researcher Award - Grant ID: DE160100964
Funder
Australian Research Council
Funding Amount
$371,000.00
Summary
Understanding and designing persuasion mechanisms. The objective of this project is to understand and design persuasion mechanisms. Persuasion is about conveying information, influencing beliefs and manipulating actions. Educational campaigns and media censorship regulations are examples of persuasion mechanisms. Existing techniques from the economics of persuasion only permit analysis of specific and limited settings. This project aims to apply the classical mechanism design approach in a novel ....Understanding and designing persuasion mechanisms. The objective of this project is to understand and design persuasion mechanisms. Persuasion is about conveying information, influencing beliefs and manipulating actions. Educational campaigns and media censorship regulations are examples of persuasion mechanisms. Existing techniques from the economics of persuasion only permit analysis of specific and limited settings. This project aims to apply the classical mechanism design approach in a novel way to model persuasion in rich and realistic settings, thus providing insights into real-world situations. It is anticipated that this will allow us to answer questions such as ‘Should an educational campaign target different consumers with different information?’ and ‘When should a government censor extreme media outlets?'.Read moreRead less
Discovery Early Career Researcher Award - Grant ID: DE170100340
Funder
Australian Research Council
Funding Amount
$311,000.00
Summary
Competition in persuasion. This project aims to develop tools to analyse situations where multiple self-interested persuaders attempt to convince a set of listeners. It will build upon recent developments in the economics of persuasion literature, and apply tools from mechanism design literature. This approach, unlike other existing work, is not limited to specific settings and has the advantage of being highly tractable. Using these tools, this project intends to provide insights into the mecha ....Competition in persuasion. This project aims to develop tools to analyse situations where multiple self-interested persuaders attempt to convince a set of listeners. It will build upon recent developments in the economics of persuasion literature, and apply tools from mechanism design literature. This approach, unlike other existing work, is not limited to specific settings and has the advantage of being highly tractable. Using these tools, this project intends to provide insights into the mechanisms behind grade inflation among universities, the optimal design of certification industries and information disclosure in clinical trials.Read moreRead less
Decentralised assets trading, centralised clearing and systemic risk. This project aims to study the effect of regulating over-the-counter (OTC) financial markets on economic performance. The lack of transparency of OTC financial markets may have exacerbated the severity of the 2007-09 financial crisis. In response, regulators around the world decided to mandate centralised clearing of derivatives traded OTC, believing this would reduce system-wide risk. This project will study the regulatory ch ....Decentralised assets trading, centralised clearing and systemic risk. This project aims to study the effect of regulating over-the-counter (OTC) financial markets on economic performance. The lack of transparency of OTC financial markets may have exacerbated the severity of the 2007-09 financial crisis. In response, regulators around the world decided to mandate centralised clearing of derivatives traded OTC, believing this would reduce system-wide risk. This project will study the regulatory change’s effects on market participation, volumes of trade and prices, and the behavioural effect of shifting risk from market participants to clearinghouses. It expects to suggest remedial policies clearinghouses could implement to control market participants’ risk appetite. These can help enhance future productivity and reduce unemployment in Australia.Read moreRead less
Incomplete Information Models for Industrial Organisation. Mergers, acquisitions, and collusive conduct take place in imperfectly competitive environments where firms have incomplete information about others. Despite this, standard workhorse models for analyzing the associated competitive effects assume that firms have complete information and typically only accommodate imperfect competition on one side of the market. This project aims to remedy this deficiency by developing the economic theory ....Incomplete Information Models for Industrial Organisation. Mergers, acquisitions, and collusive conduct take place in imperfectly competitive environments where firms have incomplete information about others. Despite this, standard workhorse models for analyzing the associated competitive effects assume that firms have complete information and typically only accommodate imperfect competition on one side of the market. This project aims to remedy this deficiency by developing the economic theory and associated practical tools for the analysis of competitive effects in settings with incomplete information and market power on both sides. The project work will be presented at seminars and workshops around the globe to both academic audiences and to practitioners at competition authorities. Read moreRead less
A robust approach to designing mechanisms for budget constrained agents. This project aims to study the design of robust implementable allocation mechanisms for agents who face financial constraints. Financial constraints are important for housing markets, big business auctions and government procurement. Yet their effect on the performance of allocation policies is not well understood. The project intends to develop a general and tractable framework of allocation mechanisms that are implementab ....A robust approach to designing mechanisms for budget constrained agents. This project aims to study the design of robust implementable allocation mechanisms for agents who face financial constraints. Financial constraints are important for housing markets, big business auctions and government procurement. Yet their effect on the performance of allocation policies is not well understood. The project intends to develop a general and tractable framework of allocation mechanisms that are implementable without deficits. The project will adapt this framework to the study of revenue-maximising multi-object auctions with complementarities, and to house allocation problems and related situations where efficiency and priority assignments are important considerations. The project expects to provide policy insights and implications relevant to the Australian housing market.Read moreRead less