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Title

Essays on Applied Microeconomics

Date of Award

Spring 5-15-2010

Author's School

Graduate School of Arts and Sciences

Author's Department

Economics

Degree Name

Doctor of Philosophy (PhD)

Degree Type

Dissertation

Abstract

This dissertation consists of three essays on applied microeconomics. The first two essays apply implementation theory to market design. The third essay develops a method for industrial organization from contract theory.

In the first essay, I examine two types of mechanisms, demand revelation mechanisms and preference revelation mechanisms, in general matching problems with contracts, as in Hatfield and Milgrom (2005). I show that the core correspondence is not Nash-implementable by any demand/preference revelation mechanism. A strong version of Maskin monotonicity plays a crucial role for this impossibility result. Second, I show that Nash equilibrium outcomes of the preference revelation game induced by any Pareto efficient matching procedure coincide with the set of individually rational allocations. This is a generalization of Alcalde (1996)’s result for one-to-one matching problems without contracts. In addition, I show that there exists a stable Nash equilibrium outcome with respect to the true preferences.

In the second essay of this dissertation, joint with Taro Kumano, we restrict attention to the deferred acceptance algorithm in school choice. We show that under substitutable and quota-filling choice functions, the deferred acceptance algorithm is dominant strategy implementable by the associated direct mechanism. We argue the pseudo-acyclicity of the revealed priority structure to characterize the set of preference revelation game outcomes in dominant strategies and Nash equilibria.

The final essay of this dissertation builds a theoretical model of firm competition via nonlinear pricing. To capture certain documented features of actual markets, the model permits firms to be asymmetric and allows for asymmetric information. I show that for a delegated common agency game in this framework, an equilibrium exists and any equilibrium outcome (specifying allocation rules and who sells to which markets) is implementable by two-part tariffs. In addition, I show that there exists a Nash equilibrium outcome in which the allocation rules exhibit pooling in an intermediate region of the type space, and quality distortions disappear at the top and the bottom of the set of consumer types served by each principal.

Language

English (en)

Chair and Committee

John Nachbar

Committee Members

Costas Azariadis, Haluk Ergin, Elizabeth Maggie Penn, Norman Schofield, Ping Wang

Comments

Permanent URL: https://doi.org/10.7936/K7MC8X0T

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