
on Microeconomics 
By:  ChiaHui Chen; Junichiro Ishida; Wing Suen 
Abstract:  This paper provides a general analysis of signaling under doublecrossing preferences with a continuum of types. There are natural economic environments where indifference curves of two types cross twice, so that the celebrated singlecrossing property fails to hold. Equilibrium exhibits a particular form of pooling: there is a threshold type below which types choose actions that are fully revealing and above which they choose actions that are clustered in possibly nonmonotonic ways, with a gap separating these two sets of types. We also provide an algorithm to establish equilibrium existence by construction under mild conditions. 
Date:  2020–10 
URL:  http://d.repec.org/n?u=RePEc:dpr:wpaper:1103&r=all 
By:  Benjamin Golub; Stephen Morris 
Abstract:  In coordination games and speculative overthecounter financial markets, solutions depend on higherorder average expectations: agents' expectations about what counterparties, on average, expect their counterparties to think, etc. We offer a unified analysis of these objects and their limits, for general information structures, priors, and networks of counterparty relationships. Our key device is an interaction structure combining the network and agents' beliefs, which we analyze using Markov methods. This device allows us to nest classical beauty contests and network games within one model and unify their results. Two applications illustrate the techniques: The first characterizes when slight optimism about counterparties' average expectations leads to contagion of optimism and extreme asset prices. The second describes the tyranny of the leastinformed: agents coordinating on the prior expectations of the one with the worst private information, despite all having nearly common certainty, based on precise private signals, of the ex post optimal action. 
Date:  2020–09 
URL:  http://d.repec.org/n?u=RePEc:arx:papers:2009.13802&r=all 
By:  Mostapha Diss (CRESE, Univ. Bourgogne FrancheComté); Eric Kamwa (LC2S, Univ. des Antilles); Muhammad Mahajne (GATE, Univ Lyon) 
Abstract:  In singlewinner elections and individuals expressing linear orderings, an alternative has firstorder stochastic dominance if the cumulative standing for this alternative at each rank is higher than that of the other alternatives. It is well known that this criterion may fail in ranking the competing alternatives since the firstorder stochastic dominance winner may not exist in some situations. Making an adaptation of a centrality measure from network theory, we introduce in this note a rule, called the almost firstorder stochastic dominance rule, which selects the alternative having firstorder stochastic dominance if such an alternative exists, otherwise it selects the alternative which is close to achieve firstorder stochastic dominance. It turns out that this rule is equivalent to the wellstudied Borda rule. This result highlights an unknown property of the Borda rule. 
Keywords:  Network, centrality, centrality measures, rankings, firstorder stochastic dominance, scoring rules, Borda’s rule. 
JEL:  C71 D71 D72 D85 
Date:  2020–07 
URL:  http://d.repec.org/n?u=RePEc:crb:wpaper:202005&r=all 
By:  Sulagna Dasgupta; Debasis Mishra 
Abstract:  We explore the consequences of weakening the notion of incentive compatibility from strategyproofness to ordinal Bayesian incentive compatibility (OBIC) in the random assignment model. If the common prior of the agents is a uniform prior, then a large class of random mechanisms are OBIC with respect to this prior  this includes the probabilistic serial mechanism. We then introduce a robust version of OBIC: a mechanism is locally robust OBIC if it is OBIC with respect all independent priors in some neighborhood of a given independent prior. We show that every locally robust OBIC mechanism satisfying a mild property called elementary monotonicity is strategyproof. This leads to a strengthening of the impossibility result in Bogomolnaia and Moulin (2001): if there are at least four agents, there is no locally robust OBIC and ordinally efficient mechanism satisfying equal treatment of equals. 
Date:  2020–09 
URL:  http://d.repec.org/n?u=RePEc:arx:papers:2009.13104&r=all 
By:  Li, Jian; Zhou, Junjie 
Abstract:  This paper examines the robustness of Lehmann’s ranking of experiments (Lehmann, 1988) for decisionmakers who are uncertaintyaverse Ã la Cerreia Vioglio et al. (2011). We show that, assuming commitment, for all uncertaintyaverse indices satisfying some mild assumptions, Lehmann’s informativeness ranking is equivalent to the induced uncertaintyaverse value ranking of experiments for all agents with singlecrossing vNM utility indices (Theorem 1). Moreover, Lehmann ranking can also be detected by varying the uncertaintyaverse indices for a fixed finite collection of vNM utility indices (Theorem 2). Our findings suggest that Lehmann’s ranking can be a useful enrichment of Blackwell’s ranking for monotone decision problems even if ambiguity is present. We apply our results to social aggregation of information preferences and investment decision problems. 
Date:  2019–07–02 
URL:  http://d.repec.org/n?u=RePEc:isu:genstf:201907020700001077&r=all 
By:  Afacan, Mustafa Oguz; Bó, Inácio; Turhan, Bertan 
Abstract:  We evaluate the goal of maximizing the number of individuals matched to acceptable outcomes. We show that it implies incentive, fairness, and implementation impossibilities. Despite that, we present two classes of mechanisms that maximize assignments. The first are Pareto efficient, and undominated, in terms of number of assignments, in equilibrium. The second are fair for unassigned students and assign weakly more students than stable mechanisms in equilibrium. We provide comparisons with wellknown mechanisms through computer simulations. Those show that the difference in number of matched agents between the proposed mechanisms and others in the literature is large and significant. 
Date:  2020–01–09 
URL:  http://d.repec.org/n?u=RePEc:isu:genstf:202001090800001092&r=all 
By:  Mostapha Diss (CRESE, Univ. Bourgogne FrancheComté); Michele Gori (Dipartimento di Scienze per l’Economia e l’Impresa, Università degli Studi di Firenze) 
Abstract:  We characterize the positional social preference correspondences (spc) satisfying the qualified majority property for any given majority threshold. We also characterize the positional spcs satisfying the minimal majority property. We next evaluate the probability that the Borda, the Plurality and the Antiplurality spcs fulfil the two aforementioned properties under two assumptions on individuals’ preferences in the presence of three and four alternatives for various sizes of the society. Our results show that the Borda spc is the positional spc which better behaves in relation with the qualified majority principle and the minimal majority principle. Finally, we propose some remarks on the concept of Condorcet consistency for social choice correspondences. 
Keywords:  social preference correspondence, social choice correspondence, positional rule, qualified majority, probability, Condorcet consistency. 
JEL:  D71 
Date:  2020–07 
URL:  http://d.repec.org/n?u=RePEc:crb:wpaper:202006&r=all 
By:  Loïc Berger (CNRS  Centre National de la Recherche Scientifique, IÉSEG School Of Management [Puteaux], LEM  Lille économie management  LEM  UMR 9221  Université de Lille  UCL  Université catholique de Lille  CNRS  Centre National de la Recherche Scientifique); Johannes Emmerling (EIEE  European Institute on Economics and the Environment) 
Abstract:  Equity (or, its counterpart, inequity) plays a fundamental role in the evaluation of social welfare in different dimensions. In this paper, we revisit the concept of inequityin the sense of unequal distributionsacross individuals, time, and states of the world using a unified framework that generalizes the standard expected discounted utilitarianism approach. We propose a general measure of welfare as equity equivalents and a corresponding inequity index. We show that allowing for different attitudes toward inequity across different dimensions covers a scope of possible inequity preferences with different interpretations. We then prove that the order of aggregation across the different dimensions matters for welfare evaluations. Finally, we show that many of the welfaretheoretical approaches recently developed in the literature can be interpreted as special cases of this general framework. 
Keywords:  Utilitarianism,Inequality,Inequity Aversion,Risk aversion,Intertemporal Welfare 
Date:  2020–09–01 
URL:  http://d.repec.org/n?u=RePEc:hal:journl:hal02937705&r=all 
By:  Alberto Grillo (Aix Marseille Univ, CNRS, AMSE, Marseille, France) 
Abstract:  Voting in large elections appears to be both ethically motivated and influenced by strategic considerations. One way to capture this interplay postulates a ruleutilitarian calculus, which abstracts away from heterogeneity in the intensity of support (Feddersen and Sandroni 2006, Coate and Conlin 2004). I argue that this approach is unsatisfactory when such heterogeneity is considered, since it implies that idiosyncratic preferences are irrelevant for participation, in contrast to the empirical evidence. A model of Kantian optimizationà la Roemer (2019), based on the maximization of individual utility under a universalization principle, predicts instead differential participation and links ethical motivation to the spatial theory of voting. 
Keywords:  voting, turnout, ethical voter, ruleutilitarian, kantian optimization 
JEL:  D72 
Date:  2020–10 
URL:  http://d.repec.org/n?u=RePEc:aim:wpaimx:2034&r=all 
By:  David Spector (PJSE  Paris Jourdan Sciences Economiques  UP1  Université PanthéonSorbonne  ENS Paris  École normale supérieure  Paris  PSL  Université Paris sciences et lettres  EHESS  École des hautes études en sciences sociales  ENPC  École des Ponts ParisTech  CNRS  Centre National de la Recherche Scientifique  INRAE  Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PSE  Paris School of Economics) 
Abstract:  When demand is noisy and firms' costs are uncertain, the availability of market share data increases the accuracy of each firm's information, and it creates incentives for signaling. Taking both effects into account, we find that under quantity competition with a homogeneous good, the availability of market share data has a positive impact on total surplus and an ambiguous one on consumer surplus. Under price competition with differentiated substitutes, it has a negative impact on consumer surplus and an ambiguous one on total surplus. If the cost difference is small, the effect of firstperiod signaling dominates the effect of secondperiod full information. Accordingly, in this case, the availability of market share data causes total and consumer surplus to increase in the case of quantity competition and to decrease in the case of price competition. 
Date:  2020–09 
URL:  http://d.repec.org/n?u=RePEc:hal:wpaper:halshs02946654&r=all 
By:  Vincent Glode; Christian Opp 
Abstract:  We develop a tractable model of strategic debt renegotiation in which businesses are sequentially interconnected through their liabilities. This financing structure, which we refer to as a debt chain, gives rise to externalities as a lender’s willingness to provide concessions to his privatelyinformed borrower depends on how this lender’s own liabilities are expected to be renegotiated. Our analysis reveals how targeted government subsidies and debt reductions as well as incentives for early renegotiation following large economic shocks such as COVID19 or a financial crisis can prevent default waves. 
JEL:  G21 G32 G33 G38 
Date:  2020–10 
URL:  http://d.repec.org/n?u=RePEc:nbr:nberwo:27883&r=all 