A principal provides budgets to agents (e.g., divisions of a firm or the principal's children) whose expenditures provide her benefits, either materially or because of altruism. Only agents know their potential to generate benefits. We prove that if the more "productive" agents are also more...

Recommender and reputation systems seek to inform potential customers by securing current consumers' feedback about products and sellers. This paper proposes a payment-based system to induce honest reporting of feedback. The system applies proper scoring rules to each buyer's report, looking to...

Strategic trade theory has been criticized on the grounds that its predictions are overly sensitive to modeling assumptions. For example, Eaton and Grossman (1986) show that Brander and Spencer's (1985) seminal result – i.e., when firms compete by setting quantities the optimal policy involves...

This paper presents a model of strategic interaction in which a third party intervenes on behalf of a government in its conflict with insurgents. It examines whether it is better for the intervenor to adopt an input-based strategy (i.e., specify the total resources it will spend) or an...

In many competitive environments, players need to commit either to a specific desired goal they will reach at any cost or to the resources they are willing to spend in pursuit of their goal. We model this situation as a two-stage game where players may compete either by setting input and letting...

A principal provides budgets to agents (e.g., divisions of a firm or the principal's children) whose expenditures provide her benefits, either materially or because of altruism. Only agents know their potential to generate benefits. We prove that if the more "productive" agents are also more...

World food prices have increased dramatically in recent years. We use panel data from 2006 to examine the impact of these increases on the consumption and nutrition of poor households in two Chinese provinces. We find that households in Hunan suffered no nutrition declines. Households in Gansu...

Many developing countries use food price subsidies or price controls to improve the nutrition of the poor. However, subsidizing goods on which households spend a high proportion of their budget can create large wealth effects. Consumers may then substitute towards foods with higher...

We consider the mechanism design problem when agents' types are multidimensional and continuous, and their valuations are interdependent. If there are at least three agents whose types satisfy a weak correlation condition, then for any decision rule there exist balanced transfers that render...

This paper provides the first rigorous, empirical evidence of the existence of Giffen behavior, i.e., a situation in which consumers respond to an increase in the price of a good by demanding more of it. We begin by examining several theoretical approaches to the Giffen phenomenon and show that...