Game Theory

A Welfare Analysis of Licensing under Rent Dissipation

This paper studies how technology transfer changes welfare in a Cournot oligopoly, taking rent dissipation into account. Firms engage in a patent competition for a cost-reducing innovation, and the winner of the competition may license the patent to its rivals. We show that welfare is reduced when innovations are minor under licensing auction, while royalty licensing never changes welfare. In addition, welfare generally fails to improve when the patentee may choose between licensing auction and royalty licensing.

Decentralized one-to-many Bargaining

An industry-wide research joint venture (RJV) does not lead to better technological development or a higher consumer surplus. In contrast, every non-industry-wide RJV leads to strict improvements in both measures. Our results continue to hold when technology transfer is possible. Independent collaboration with technology transfer is an alternative to establishing industry-wide research consortiums.

Research Joint Venture with Technology Transfer

An industry-wide research joint venture (RJV) does not lead to better technological development or a higher consumer surplus. In contrast, every non-industry-wide RJV leads to strict improvements in both measures. Our results continue to hold when technology transfer is possible. Independent collaboration with technology transfer is an alternative to establishing industry-wide research consortiums.

Technical Analysis with R

This is an introductory textbook that focuses on how to use R to test a technical trading strategy. No prior programming knowledge is needed..

TikZ Cookbook

TikZ is a drawing package in LaTeX. It is very useful to draw a professional-looking diagram. However, the learning curve is a little bit steep for a beginner. This is a cookbook that provides step-by-step illustrations on how to use TikZ to draw various diagrams in economics.

TikZ Cookbook Companion

TikZ is a drawing package in LaTeX. It is very useful to draw a professional-looking diagram. However, the learning curve is a little bit steep for a beginner. This is a cookbook that provides step-by-step illustrations on how to use TikZ to draw various diagrams in economics.

Decentralized mechanisms for river sharing

We study the decentralized implementation of efficient outcomes through multilateral bargaining in the river sharing problem. We consider a class of mechanisms where agents first announce consumption levels and then bargain over monetary compensation. We first determine which mechanisms give incentives to always allocate the water efficiently. Among these, we take an axiomatic approach to single out three mechanisms that guarantee a fair division of the welfare gain.

On the Role of Outside Options in Wage Renegotiation

A worker with a superior outside offer starts a wage renegotiation with his current employer. The worker may exercise the outside option whenever a proposal is rejected. Entire surplus may be extracted by the worker. Opting out can arise in equilibrium under complete information.

Sharing sequential values in a network

We study the decentralized implementation of efficient outcomes through multilateral bargaining in the river sharing problem. We consider a class of mechanisms where agents first announce consumption levels and then bargain over monetary compensation. We first determine which mechanisms give incentives to always allocate the water efficiently. Among these, we take an axiomatic approach to single out three mechanisms that guarantee a fair division of the welfare gain.

A Note on Budget Constraints and Outside Options in Common Agency

In common agency games without budget constraints and outside option, Bernheim and Whinston (1986) show that CPNE=TNE=Principal-optimal core in the payoff space. With budget constraints or outside options, CPNE and TNE may not exist and may not be equivalent to each other. TNEs can be Pareto ranked, contrary to Dixit, Grossman, and Helpman (1996). CPNEs do not avoid a coordination problem, as they can be Pareto dominated by a TNE.