Exploding Offers, Risk Aversion and Welfare (with Lea Nagel, Vlasta Rasocha and Roberto Saitto)

Abstract: We study exploding offers by considering the strategic interaction between a low-tier firm and a set of workers within a large job market. Each worker has a private value for the firm and may receive offers from preferred top-tier firms according to an exogenous stochastic process. We show that more risk averse workers receive offers with shorter deadlines, and that there is a level of risk aversion beyond which a worker only receives offers that expire as soon as possible—independently of what all other firms are doing. If workers are sufficiently risk averse, the workers’ expected welfare is maximized if and only if exploding offers are banned. Finally, any minimal offer length that does not ban exploding offers may lead to workers falling through the cracks. All results are robust to a range of sequentially-rational strategies for the workers. Our predictions match existing evidence and have implications for policies regulating exploding offers.

[Draft coming soon]

Presented at (by coauthor or myself): 2023 EEA-ESEM (Barcelona, ES), UBA, UTDT

Scars of the Gestapo: Remembrance and Privacy Concerns (with Florencia Hnilo)

2022 Sean Buckley Memorial Award for Best Second-Year Paper, Stanford University, Dept. of Economics

Abstract: We study how remembrance of an authoritarian regime impacts privacy concerns. Our main hypothesis is that Germany's culture of Holocaust remembrance (Erinnerungskultur) focuses Germans’ attention on the risks associated with private data ending up in the wrong hands. One example of this culture of remembrance are the Stolpersteine, plaques on the sidewalk signalling that a victim of Nazi persecution lived on a given address. We use a detailed street level imagery dataset of Berlin to relate the location of the Stolpersteine to a novel geolocated measure of privacy concerns: whether a person asks for their building to be blurred on a street-level imagery provider. We show that there exists a positive relationship between the amount of Stolpersteine near a person’s house or workplace, and the probability that this person will ask the imagery provider to blur the front of their house. This relationship is very localized, as most of the effect concentrates on Stolpersteine that are less than 10 meters away.

[New draft coming soon] [SSRN]

Presented at (by coauthor or myself): ASREC 2023 (Cambridge, MA), 2023 EHES Conference (Vienna, AT), 2023 European Meeting of the UEA (Milan, IT), Paris Dauphine University-PSL, UTDT

Buyers' Welfare Maximizing Auction Design. International Journal of Game Theory, Vol. 52 (2), pp. 555-567 (2023).

Abstract: I derive the incentive compatible and individually rational mechanism that maximizes the sum of the buyers' ex-ante expected utilities. I also show that this mechanism minimizes the seller's revenue. When payments are required to be non-negative, my mechanism takes the form of an arbitrarily weighted lottery with no participation fees, and the resulting allocation is generally not ex-post efficient. This means that before learning their valuations and if side payments from the seller to the buyers are not allowed, buyers as a group would be better off if they gave up ex-post efficiency in order to avoid positive payments. When transfers are allowed, the optimal mechanism is a standard auction with no reserve price and where the seller's income is redistributed back to the buyers. This mechanism is robust to speculators if a buyer with value 0 never partakes in the redistribution.

[Draft] [Published]