We study the role of communication in repeated games with private monitoring. We first show that without communication, the set of Nash equilibrium payoffs in such games is a subset of the set of ε-coarse correlated equilibrium payoffs (ε-CCE) of the underlying one-shot game. The value of...

Educational tracking seeks to group students by unobserved ability using measures of observable acquired skills. In a model where individuals have differential skills prior to beginning formal education due to differences in early childhood development (e.g. linguistic, cultural, or nutritional...

Is it better to be a big fish in a small pond or a small fish in a big pond? To find out, we study self-selection into contests among a large population of heterogeneous agents. Our simple and highly tractable model generates many testable and sometimes surprising predictions. For example: 1)...

We study career choice when competition for promotion is a contest. A more meritocratic profession always succeeds in attracting the highest ability types, whereas a profession with superior promotion benefits attracts high types only if the hazard rate of the noise in performance evaluation is...

We study situations where a new entrant with privately known talent competes with an incumbent whose talent is common knowledge. Competition takes the form of a rank-order tournament. Prior to the competition, the newbie can "show off," i.e., send a talent revealing costly signal. We find that...

We report the results of laboratory experiments on rent-seeking contests with endogenous participation. Theory predicts that (a) contest entry and rent-seeking expenditures increase with the size of the prize; and (b) earnings are equalized between the contest and the outside option. While the...

Does political polarization lead to dysfunctional behavior? To study this question, we investigate the attitudes of supporters of Donald Trump and of Hillary Clinton towards each other and how these attitudes affect spiteful behavior. We find that both Trump and Clinton supporters display less...

This paper (1) presents a general model of online price competition, (2) shows how to structurally estimate the underlying parameters of the model when the number of competing firms is unknown or in dispute, (3) estimates these parameters based on UK data for personal digital assistants, and (4)...