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Main idea: This topic surveys a variety of consumer search models. The two principles play an important role in generalizing some of the findings. These models are cornerstones for modeling price competition.
*[[Baye Morgan Scholten 2006 - Information Search and Price Dispersion | Baye, Michael R., John Morgan, and Patrick Scholten (2006)]], "Information, Search, and Price Dispersion,"]] Handbook of Economics and Information Systems (T. Hendershott, ed.), Elsevier Press, Amsterdam. [http://faculty.haas.berkeley.edu/rjmorgan/Information%20Search%20and%20Price%20Dispersion.pdf link] [http://www.edegan.com/pdfs/Baye%20Morgan%20Scholten%20(2006)%20-%20Information%20Search%20and%20Price%20Dispersion.pdf pdf]
*Baye, Michael R., John Morgan, and Patrick Scholten (2004), "Price Dispersion in the Large and in the Small: Evidence from an Internet Price Comparison Site", Journal of Industrial Economics, December, 52(4): 463-96. [http://faculty.haas.berkeley.edu/rjmorgan/Small&Large.pdf link] [http://www.edegan.com/pdfs/Baye%20Morgan%20Scholten%20(2004)%20-%20Price%20Dispersion%20in%20the%20Large%20and%20in%20the%20Small.pdf pdf]
Note that in subsequent years Nitzan (1994) will be replaced with:
*[[Konrad (2007) - Strategy In Contests-An Introduction |Konrad, Kai A. (2007)]], "Strategy in Contests-An Introduction", WZB-Markets and Politics Working Paper No. SP II 2007-01, [http://papers.ssrn.com/sol3/papers.cfm?abstract_id=960458 link] [http://www.edegan.com/pdfs/Konrad%20(2007)%20-%20Strategy%20in%20Contests-An%20Introduction.pdf pdf]
3.) '''Platform Competition'''
Main idea: This topic highlights the emerging literarture on platform competition and two-sided markets. The revenue equivalence principle sees a little sue here as well. These are the leading modeling approaches for markets that are increasingly prominent.
*[[Ellison Fudenberg Mobius (2004) - Competing Auctions |Ellison, Glenn, Fudenberg, Drew, and Möbius, Markus (2004)]], "Competing Auctions", Journal of the European Economic Association, Mar, Vol. 2 Issue 1, p30-66 [http://www.mitpressjournals.org/doi/abs/10.1162/154247604323015472 link] [http://www.edegan.com/pdfs/Ellison%20Fudenberg%20Mobius%20(2004)%20-%20Competing%20Auctions.pdf pdf]*[[Caillaud Jullien (2003) - Chicken And Egg |Caillaud, Bernard and Bruno Jullien (2003) ]], "Chicken & Egg: Competition among Intermediation Service Providers", The RAND Journal of Economics, Vol. 34, No. 2. (Summer), pp. 309-328. [http://links.jstor.org/sici?sici=0741-6261%28200322%2934%3A2%3C309%3AC%26ECAI%3E2.0.CO%3B2-F link] [http://www.edegan.com/pdfs/Caillaud%20Jullien%20(2003)%20-%20Chicken%20and%20Egg.pdf pdf]
*Brown, Jennifer and John Morgan (2009), "How much is a Dollar Worth? Tipping versus Equilibrium Coexistence on Competing Online Auction Sites", Journal of Political Economy, Vol. 117, No. 4, pp. 668-700. [http://faculty.haas.berkeley.edu/rjmorgan/How%20Much%20is%20a%20Dollar%20Worth.pdf link] [http://www.edegan.com/pdfs/Brown%20Morgan%20(2009)%20-%20How%20much%20is%20a%20Dollar%20Worth.pdf pdf]
Main idea: This topic covers information flows in organizations by examining an archetypal class of signaling games in business and public policy---corporate lobbying as cheap talk.
*[[Grossman Helpman (2001) - Special Interest Politics Chapters 4 And 5 |Grossman, Gene and Elhanan Helpman (2001)]], "Special Interest Politics", Chapters 4 and 5, MIT Press [http://www.edegan.com/pdfs/Grossman%20Helpman%20(2001)%20-%20Special%20Interest%20Politics%20Chapters%204%20And%205.pdf pdf]
5.) '''Contracting under imperfect commitment'''
Main idea: This topic ties together the two principles with the previous unit on cheap talk signaling. The role of delegation in organizations is stressed.
*[[Dessein (2002) - Authority And Communication In Organizations |Dessein, Wouter (2002)]], "Authority and Communication in Organizations", The Review of Economic Studies, Vol. 69, No. 4. (Oct.), pp. 811-838. [http://links.jstor.org/sici?sici=0034-6527%28200210%2969%3A4%3C811%3AAACIO%3E2.0.CO%3B2-E link] [http://www.edegan.com/pdfs/Dessein%20(2002)%20-%20Authority%20and%20Communication%20in%20Organizations.pdf pdf]*[[Krishna Morgan (2008) - Contracting For Information Under Imperfect Commitment |Krishna, Vijay and John Morgan (2008)]], "Contracting for information under imperfect commitment", RAND Journal of Economics, Winter, Vol. 39, No. 4, pp. 905-925. [http://faculty.haas.berkeley.edu/rjmorgan/Contracts.pdf link] [http://www.edegan.com/pdfs/Krishna%20Morgan%20(2008)%20-%20Contracting%20for%20information%20under%20imperfect%20commitment.pdf pdf]
6.) '''Incomplete Contracts'''
Main idea: To tie together the classic incomplete contracting works with mechanism design.
*[[Hart Moore (1988) - Incomplete Contracts And Renegotiation |Hart, Oliver and John Moore (1988)]], "Incomplete Contracts and Renegotiation", Econometrica, Vol. 56, No. 4. (Jul.), pp. 755-785. [http://links.jstor.org/sici?sici=0012-9682%28198807%2956%3A4%3C755%3AICAR%3E2.0.CO%3B2-I link] [http://www.edegan.com/pdfs/Hart%20Moore%20(1988)%20-%20Incomplete%20Contracts%20and%20Renegotiation.pdf pdf]*[[Aghion Dewatripont Rey (1994) - Renegotiation Design With Unverifiable Information |Aghion, Philippe, Mathias Dewatripont, and Patrick Rey (1994)]], "Renegotiation Design with Unverifiable Information", Econometrica, Vol. 62, No. 2. (Mar.), pp. 257-282. [http://links.jstor.org/sici?sici=0012-9682%28199403%2962%3A2%3C257%3ARDWUI%3E2.0.CO%3B2-G link] [http://www.edegan.com/pdfs/Aghion%20Dewatripont%20Rey%20(1994)%20-%20Renegotiation%20Design%20with%20Unverifiable%20Information.pdf pdf]
==2nd Half==
Class 1.) '''Career Concerns and "Signal Jamming" Models''' (3/16/10)
*Fama, E.F. (1980), "Agency Problems and the Theory of the Firm," Journal of Political Economy, 88(2): 288 307 (Supplemental Reading) [http://www.edegan.com/pdfs/Fama%20(1980)%20-%20Agency%20Problems%20and%20the%20Theory%20of%20the%20Firm.pdf pdf]
*[[Holmstrom (1999) - Managerial Incentive Problems |'''Holmstrom B., (1999)''' ]], "Managerial Incentive Problems: A Dynamic Perspective," Review of Economic Studies, 66(1): 169-182 [http://www.edegan.com/pdfs/Holmstrom%20(1999)%20-%20Managerial%20Incentive%20Problems.pdf pdf]
*Holmstrom B. and J. Ricart i Costa (1985), "Managerial Incentives and Capital Management," Quarterly Journal of Economics, 101(4): 835 860 (Supplemental Reading) [http://www.edegan.com/pdfs/Holmstrom%20Costa%20(1985)%20-%20Managerial%20Incentives%20and%20Capital%20Management.pdf pdf]
*[[Gibbons Murphy (1992) - Optimal Incentive Contracts In The Presence Of Career Concerns |'''Gibbons, R. and K.J. Murphy (1992)''']], "Optimal Incentive Contracts in the Presence of Career Concerns: Theory and Evidence," Journal of Political Economy, 100(3): 468 505. [http://www.edegan.com/pdfs/Gibbons%20Murphy%20(1992)%20-%20Optimal%20Incentive%20Contracts%20in%20the%20Presence%20of%20Career%20Concerns.pdf pdf]
*Dewatripont, M., I. Jewitt and J. Tirole (1999) "The Economics of Career Concerns, Part I: Comparing Information Systems," Review of Economic Studies, 66(1): 183-198 (Supplemental Reading) [http://www.edegan.com/pdfs/Dewatripont%20Jewitt%20Tirole%20(1999)%20-%20The%20Economics%20of%20Career%20Concerns%20Part%20I.pdf pdf]
*Dewatripont, M., I. Jewitt and J. Tirole (1999) "The Economics of Career Concerns, Part II: Applications to Missions and Accountability of Government Agencies," Review of Economic Studies, 66(1): 199-217 (Supplemental Reading) [http://www.edegan.com/pdfs/Dewatripont%20Jewitt%20Tirole%20(1999)%20-%20The%20Economics%20of%20Career%20Concerns%20Part%20II.pdf pdf]
Class 2.) '''Signaling Models of Reputation''' (4/6/10)
*Kreps, D., P. Milgrom, J. Roberts and R. Wilson (1982) "Rational Cooperation in the Finitely Repeated Prisoners' Dilemma," Journal of Economic Theory, 27(2): 245 252 (Supplemental Reading) [http://www.edegan.com/pdfs/Kreps%20Milgrom%20Roberts%20Wilson%20(1982)%20-%20Rational%20Cooperation%20in%20the%20Finitely%20Repeated%20Prisoners%20Dilemma.pdf pdf]
*[[Diamond (1989) - Reputation Acquisition In Debt Markets |'''Diamond, D. (1989)''']], "Reputation Acquisition in Debt Markets," Journal of Political Economy, 97(4): 828 862 [http://www.edegan.com/pdfs/Diamond%20(1989)%20-%20Reputation%20Acquisition%20in%20Debt%20Markets.pdf pdf]
*Horner, J. (2002) "Reputation and Competition," American Economic Review 92(3):644-663 (Supplemental Reading) [http://www.edegan.com/pdfs/Horner%20(2002)%20-%20Reputation%20and%20Competition.pdf pdf]
Class 3.) '''Reputation as a Tradeable Asset and Incentive Provision''' (4/13/10)
*[[Kreps (1990) - Corporate Culture And Economic Theory |'''Kreps, D. (1990)''' ]], "Corporate Culture and Economic Theory," in J. Alt and K. Shepsle, Eds. Perspectives on Positive Political Economy, Cambridge University Press (Book excerpts available through [http://books.google.com/books?hl=en&lr=&id=JBrDXvye-1UC&oi=fnd&pg=PA221&dq=Kreps,+D.++%22Corporate+Culture+and+Economic+Theory&ots=d4JUQusjjf&sig=7RVgXjAlocVC8FDJd2Ke1MsbjxY Google Books])
*Tadelis, S. (1999) "What’s in a Name? Reputation as a Tradeable Asset," American Economic Review, 89(3): 548 63 (Supplemental Reading) [http://www.edegan.com/pdfs/Tadelis%20(1999)%20-%20Whats%20in%20a%20Name%20Reputation%20as%20a%20Tradeable%20Asset.pdf pdf]
*[[Tadelis (2001) - The Market For Reputations As An Incentive Mechanism |'''Tadelis, S. (2001)''' ]], "The Market for Reputations as an Incentive Mechanism," Journal of Political Economy 110(4):854-882 [http://www.edegan.com/pdfs/Tadelis%20(2001)%20-%20The%20Market%20for%20Reputations%20as%20an%20Incentive%20Mechanism.pdf pdf]
*Mailath, G., and L. Samuelson (2001), "Who Wants a Good Reputation?" Review of Economic Studies, April (reprinted with typo corrections in July) (Supplemental Reading) [http://www.edegan.com/pdfs/Mailath%20Samuelson%20(2001)%20-%20Who%20Wants%20a%20Good%20Reputation.pdf pdf]
Class 4.) '''Reputational Incentives''' (4/20/10)
*[[Jin Leslie (2009) - Reputational Incentives For Restaurant Hygiene |'''Jin, G. and P. Leslie (2009)''' ]], "Reputational Incentives for Restaurant Hygiene", American Economic Journal: Microeconomics, 1(1): 237-67 (Supplemental Reading) [http://www.edegan.com/pdfs/Jin%20Leslie%20(2009)%20-%20Reputational%20Incentives%20for%20Restaurant%20Hygiene.pdf pdf]*[[Cabral Hortacsu (2008) - Dynamics Of Seller Reputation |'''Cabral, Luis and Ali Hortacsu (2008)''' ]], "Dynamics of Seller Reputation: Theory and Evidence from eBay" forthcoming, Journal of Industrial Economics [http://www.edegan.com/pdfs/Cabral%20Hortacsu%20(2008)%20-%20Dynamics%20of%20Seller%20Reputation.pdf pdf]
Class 5.) '''Reputational Incentives cont.''' (4/27/10)
Class 6.) '''Procurement Theory''' (5/4/10)
*[[Levin Tadelis (2008) - Contracting For Government Services |'''Levin, Jonathan and Steven Tadelis (2008)''' ]], "Contracting for Government Services: Theory and Evidence from U.S. Cities," forthcoming, Journal of Industrial Economics. [http://www.edegan.com/pdfs/Levin%20Tadelis%20(2008)%20-%20Contracting%20for%20Government%20Services.pdf pdf]*[[Williamson (1971) - The Vertical Integration Of Production |'''Williamson, Oliver E. (1971)''']], "The Vertical Integration of Production: Market Failure Considerations," American Economic Review, 61:112-23. [http://www.edegan.com/pdfs/Williamson%20(1971)%20-%20The%20Vertical%20Integration%20of%20Production.pdf pdf]*[[Goldberg (1977) - Competitive Bidding And The Production Of Precontract Information |'''Goldberg, Victor P. (1977)''' ]], "Competitive Bidding and the Production of Precontract Information," Bell Journal of Economics, 8:250-261 [http://www.edegan.com/pdfs/Goldberg%20(1977)%20-%20Competitive%20Bidding%20and%20the%20Production%20of%20Precontract%20Information.pdf pdf]
*Holmstrom, Bengt and Paul Milgrom (1991) "Multitask Principal-Agent Analyses: Incentive Contracts, Asset Ownership and Job Design". Journal of Law, Economics and Organization 7:24-52. (Supplemental Reading) [http://www.edegan.com/pdfs/Holmstrom%20Milgrom%20(1991)%20-%20Multitask%20Principal%20Agent%20Analyses.pdf pdf]
*McAfee, Preston and McMillan, John (1986) "Bidding for Contracts: a Principal-Agent Analysis," RAND Journal of Economics 17(3):326-338. (Supplemental Reading) [http://www.edegan.com/pdfs/McAfee%20McMillan%20(1986)%20-%20Bidding%20for%20Contracts.pdf pdf]
Class 7.) '''Empirics on Procurement''' (5/6/10 Thursday or 5/11/10 Tuesday)
*[[Banerjee Duflo (2000) - Reputation Effects And The Limits Of Contracting |'''Banerjee, A. and Duflo E. (2000)''' ]], "Reputation Effects and the Limits of Contracting: A Study of the Indian Software Industry," Quarterly Journal of Economics, 115:989-1018. [http://www.edegan.com/pdfs/Banerjee%20Duflo%20(2000)%20-%20Reputation%20Effects%20and%20the%20Limits%20of%20Contracting.pdf pdf]*[[Forbes Lederman (2009) - Adaptation And Vertical Integration In The Airline Industry |'''Forbes, Silke J. and Mara Lederman, (2009)''' ]], "Adaptation and Vertical Integration in the Airline Industry," American Economic Review, forthcoming. [http://www.edegan.com/pdfs/Forbes%20Lederman%20(2009)%20-%20Adaptation%20and%20Vertical%20Integration%20in%20the%20Airline%20Industry.pdf pdf]
*Forbes, Silke J. and Mara Lederman, (2010) "The Performance Implications of Vertical Integration: Evidence from the Airline Industry," mimeo. (Supplemental Reading) (pdf not available at this time)
*Bajari, Patrick, Stephanie Houghton and Steven Tadelis (2010) "Bidding for Incomplete Contracts: An Empirical Analysis," mimeo (Supplemental Reading) [http://www.edegan.com/pdfs/Bajari%20Houghton%20Tadelis%20(2010)%20-%20Bidding%20for%20Incomplete%20Contracts.pdf pdf]
*Corts, Kenneth and Jasjit Singh (2004) "The Effect of Repeated Interaction on Contract Choice: Evidence from Offshore Drilling," Journal of Law, Economics and Organizations 20:230-260. (Supplemental Reading) [http://www.edegan.com/pdfs/Corts%20Singh%20(2004)%20-%20The%20Effect%20of%20Repeated%20Interaction%20on%20Contract%20Choice.pdf pdf]
*Bajari, Patrick, Robert McMillan and Steven Tadelis (2009) "Auctions versus Negotiations in Procurement: An Empirical Analysis," Journal of Law, Economics and Organization 25:372-399 (Supplemental Reading) [http://www.edegan.com/pdfs/Bajari%20McMillan%20Tadelis%20(2009)%20-%20Auctions%20versus%20Negotiations%20in%20Procurement.pdf pdf]
