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Essays on Endogenous Information Acquisition in Economics
Ilinov, Pavel ; Steiner, Jakub (advisor) ; Kováč, Eugen (referee) ; Michelucci, Fabio (referee)
English Abstracts Pavel Ilinov 1 First Chapter In the first chapter we consider two types of models: (i) a rational inattention problem and (ii) a conformity game, in which fully informed players find it costly to deviate from average behavior. We show that these problems are equivalent to each other, both from the perspective of the participant and the outside observer: each individual faces identical trade-offs in both situations, and an observer would not be able to distinguish the two models from the choice data they generate. We also establish when individual behavior in the conformity game maximizes welfare. 2 Second Chapter The second chapter shows that the principal can strictly benefit from delegating a decision to an agent whose opinion differs from that of the principal. We consider a "delegated expertise" problem in which the agent has an advantage in information acquisition relative to the principal, rather than having preexisting private information. When the principal is ex ante predisposed towards some action, it is optimal for her to hire an agent who is predisposed towards the same action, but to a lesser extent, since such an agent would acquire more information, which outweighs the bias stemming from misalignment. We show that belief misalignment between an agent and a principal is a...
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Explorations into Behavioral Phenomena
Appleman, William ; Michelucci, Fabio (advisor) ; McBride, Michael (referee) ; Attanasi, Giuseppe (referee)
Taxation impacts social welfare in an intricate manner. Currently employed tax instruments throughout the world possess inherently different salience characteristics. Tax salience effect refers to the optimization error occurring when agents do not fully account for taxes that do not appear in posted prices. Purchase size effect (PSE), refers to how the tax salience effect changes based on the size of the monetary stake of the purchase. The first chapter of this dissertation aims to assess whether participants in a 'quasi-field' laboratory experiment with an online shopping environment, real goods, low and high price/type goods, and with conspicuous taxation cues will make tax salience "errors" and if they will make less of them when purchasing more expensive goods. This is the first experiment in the literature to focus on the PSE dimension of tax salience and to divide participants into low and high income-/wealth-analogous budget levels. The results confirm consistent and significant tax salience effects and reveal the PSE despite the cues. Tax salience effect is most driven by high-budget participants while low-budget participants exhibit several more significant PSE difference estimates. Such a combination suggests that those with more constraining budgets were less likely to be making a tax...
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Electoral contests with dynamic campaign contributions
Mattozzi, Andrea ; Michelucci, Fabio
We study a two-period dynamic principal agent model in which two agents with different unobservable abilities compete in a contest for a single prize. A risk-neutral principal can affect the outcome of the contest by dividing a given budget between agents in each period and her net payoff depends on the relative share of the budget given to the winner of the contest. We analyze two settings that differ by the presence/absence of moral hazard. The results we derive are consistent with stylized facts regarding the dynamics of US campaign contributions.
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Does anticipated regret really matter? Revisiting the role of feedback in auction bidding
Katuščák, Peter ; Michelucci, Fabio ; Zajíček, M.
Does the type of post-auction feedback affect bidding behavior in first price auctions? Filiz- Ozbay and Ozbay (2007) find that such manipulation can increase bids in a one-shot auction. They explain this as an effect of anticipated regret combined with the assumption that feedback directly affects salience of regret relative to material payoff. We revisit this important market design issue using four different auction protocols and a large sample of subjects. We do not find any systematic effect of feedback on the average bid/value ratio. This evidence indicates either the lack of anticipated regret or its manipulability by feedback in one-shot auctions.
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Does anticipated regret really matter? Revisiting the role of feedback in auction bidding
Katuščák, Peter ; Michelucci, Fabio ; Zajíček, M.
Does the type of post-auction feedback affect bidding behavior in the first price auction? Filiz-Ozbay and Ozbay (2007) find that such manipulation can increase bids in a one-shot auction. They explain their finding by anticipated regret combined with the assumption that feedback directly affects salience of regret relative to material payoff. We revisit this important market design issue using four different auction protocols and a large sample of subjects. We do not find any systematic effect of feedback on the average bid/value ratio. This evidence contradicts a presence of anticipated regret or its manipulability by feedback in one-shot auctions.
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