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Persuasion by dimension reduction
Malamud, Semyon; Schrimpf, Andreas - 2021 - This version: October 17, 2021
How should an agent (the sender) observing multi-dimensional data (the state vector) persuade another agent to take the desired action? We show that it is always optimal for the sender to perform a (non-linear) dimension reduction by projecting the state vector onto a lower-dimensional object...
Persistent link: https://www.econbiz.de/10012799529
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Policy announcement design
Cieślak, Anna; Malamud, Semyon; Schrimpf, Andreas - 2020 - This version: December 15, 2019
We study the general problem of information design for a policymaker—a central bank—that communicates its private information (the ``state") to the public. We show that it is optimal for the policymaker to partition the state space into a finite number of ``clusters” and to communicate to...
Persistent link: https://www.econbiz.de/10012181571
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Optimal feedback dynamics against free-riding in collective experimentation
Chen, Chia-hui; Eraslan, Hülya; Ishida, Junichiro; … - 2024
We consider a dynamic model in which a principal decides what information to release about a product of unknown quality (e.g., a vaccine) to incentivize agents to experiment with the product. Assuming that the agents are long-lived and forward-looking, their incentive to wait and see other...
Persistent link: https://www.econbiz.de/10015047806
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Hierarchical experimentation
Chen, Chia-hui; Ishida, Junichiro - 2015
rationale for delegation. …
Persistent link: https://www.econbiz.de/10011343543
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Delegating learning
Escobar, Juan F.; Zhang, Qiaoxi - In: Theoretical economics : TE ; an open access journal in … 16 (2021) 2, pp. 571-603
Learning is crucial to organizational decision making but often needs to be delegated. We examine a dynamic delegation … delegation as a dynamic mechanism design problem and characterize the optimal delegation scheme. We show that private learning … discuss implications on learning delegation for distinct organizations. …
Persistent link: https://www.econbiz.de/10012587421
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Algorithmic Collusion : Insights from Deep Learning
Hettich, Matthias - 2021
significantly faster. Collusion disappears in wide oligopolies with up to 10 firms but increases with a reformulated state … representation. Contrary, heterogeneity among pricing algorithms hinders collusion …
Persistent link: https://www.econbiz.de/10013241445
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Dynamics of Market Making Algorithms in Dealer Markets : Learning and Tacit Collusion
Cont, Rama; Xiong, Wei - 2022
effects resulting from the autonomous learning dynamics of these algorithms. In particular the possibility of `tacit collusion … bid-ask spreads. Competition among dealers is modeled as a Nash equilibrium, while collusion is described in terms of … sharing of information, may give rise to tacit collusion, with spread levels strictly above the competitive equilibrium level …
Persistent link: https://www.econbiz.de/10013406004
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Strategic choice of price-setting algorithms
Buchali, Katrin; Grüb, Jens; Muijs, Matthias; … - 2023
Recent experimental simulations have shown that autonomous pricing algorithms are able to learn collusive behavior and thus charge supra-competitive prices without being explicitly programmed to do so. These simulations assume, however, that both firms employ the identical price-setting...
Persistent link: https://www.econbiz.de/10013534374
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Learning in Relational Contracts
Kostadinov, Rumen - 2018
We study relational contracts in a firm-worker relationship with mutual uncertainty about match quality. The worker's actions are publicly observed and generate output, and hence information about the match quality. Despite the absence of private information, uncertainty about match quality...
Persistent link: https://www.econbiz.de/10012935641
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Learning Paths to Offshore Outsourcing - From Cost Reduction to Knowledge Seeking
Maskell, Peter; Pedersen, Torben; Preuss, Björn; … - 2015
A corporation's offshore outsourcing may be seen as the result of a discrete, strategic decision taken in response to an increasing pressure from worldwide competition. However, empirical evidence of a representative cross-sector sample of international Danish firms indicates that offshore...
Persistent link: https://www.econbiz.de/10014051188