This paper presents the authors' rejoinder to Zeithammer and Adams [Zeithammer, R., C. Adams. 2010. The sealed-bid abstraction in online auctions. Marketing Sci. 29(6) 964-987]. This rejoinder clarifies and qualifies conclusions of the original paper and makes suggestions for fruitful areas of...

This paper presents five empirical tests of the popular modeling abstraction that assumes bids from online auctions with proxy bidding can be analyzed "as if" they were bids from a second-price sealed-bid auction. The tests rely on observations of the magnitudes and timings of the top two proxy...

Using bid data from 8,000 new and used Chevrolet Corvettes sold on eBay, this paper empirically tests Akerlof's (1970) hypothesis that the used car market is characterized by low quality and informational problems. The hypothesis states that the used market has a higher proportion of low quality...

This paper presents a model of moral hazard where differences in actions are driven by differences in time-preferences rather than differences in risk-preferences. The paper discusses two solutions to the time-preference induced incentive problem. First, in some circumstances, the incentive...

This paper builds on the ideas of Manski (2006) and Wolfers and Zitzewitz (2005) to show when learning is allowed, an electronic market (a prediction market) may aggregate information. In particular, adding learning to the model used in Manski (2006) causes the market price to converge to the...

This paper replicates DiMasi et al (2003, 2004) estimates of expenditure on new drug development using publicly available data. The paper estimates that average expenditure on drugs in human clinical trials is around $27m per year, with $17m per year on drugs in Phase I, $34m on drugs in Phase...

The paper shows that the answer is no. Holmstrom (1979) and Shavell (1979) show that the sell the firm contract does not achieve the first best when the principal and the agent have different preferences over risk. This paper shows that the sell the firm contract does not achieve the first best...

The decision maker is assumed to observe a large number of experiments. The paper presents conditions for the existence of a unique prior over distributions that generate each of the observed samples. The axioms over experiments admit a recursive non-expected utility representation over...