International Journal of Economic Theory最新文献

This paper constructs a general equilibrium model in a world with two-symmetric countries. It explains welfare gains from international trade and horizontal Foreign Direct Investment (FDI) in the economy with firm heterogeneity and variable markups stemming from oligopolistic competition. My model shows that the pro-competitive effects of trade and horizontal FDI happen because trade openness induces an increase in product market competition that reduces markups and toughens selection, increasing aggregate productivity. The most significant contribution of the paper is that multinational firms, via horizontal FDI, produce the most significant welfare gains through the toughest selection and lowest markups.

This paper presents various examples of two-player submodular or supermodular contest games. Emphasizing the three main elements of a contest model, our examples revolve around situations where (i) contest success function allows for a draw, (ii) winning prize is not exogenously given but rather jointly produced, or (iii) individual effort cost also depends on the rival's effort. We then illustrate how submodularity and supermodularity can be used to study the existence of equilibrium, the order structure of the equilibrium set, and monotone comparative statics in such contest game examples.

We investigate a finite-horizon dynamic pricing problem of a seller under limited commitment. Even when the buyers are ex ante symmetric to the seller, the seller can charge different prices to different buyers. We show that under the class of posted-price mechanisms this asymmetric treatment of symmetric buyers strictly revenue-dominates symmetric treatment. The seller implements this by using a priority-based deterministic tie-breaking rule instead of using a random tie-breaking rule. The effect of asymmetric treatment on revenue increment increases monotonically as we increase the time horizon of the game.

We study the effects of three forms of taxation—a tax levied on the platform's revenue, an ad valorem tax on consumers' access fees and tax imposed on per-transaction fees of sellers, in vertically differentiated two-sided duopoly platforms with cross-side network effects. The level of informative advertising which increases the probability of finding sellers by buyers, declines with taxes for each platform. Analytical comparison between tax regimes has been made. Additionally, for an increased degree of cross-group externality, platforms raise the level of informative advertising irrespective of tax structures.

This paper proposes a model of irresolute choice rationalizing random choice behavior and examines its applications to decision making under certainty, uncertainty, and risk. Depending on the context, the representations feature canonical signal spaces. Decisions are governed by random draws of signals generating stochastic choice functions. Application to portfolio selection and experimental testing are discussed.

This paper investigates privatization policy in mixed oligopoly when partial privatization changes a technological difference between semi-public and private firms. It shows that when the degree of privatization is partial, privatization is insufficient. Furthermore, privatization is more likely to be insufficient as the market becomes more competitive. If the cost efficiency gain is captured by decreasing the degree of privatization, privatization is insufficient regardless of whether entry by private firms is restricted or free.

This paper examines the effects of China's population control policy on its economic transitions and long-run equilibrium theoretically and quantitatively. The model-predicted technological progress is assumed to be driven by population size and education level. With population control, the total number of children decreases; however, the average education level increases. Since the overall effect on technological progress is ambiguous, we performed a quantitative analysis of the model. The results demonstrate that population, technological progress, and income per capita move in endogenous cycles. The impact of China's population control policy depends on the timing of its implementation.