NERA-STICERD Industrial Organisation Seminars

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These seminars are held on Mondays in term time at 12:30-14:00 in room 32L 2.04 (2nd Floor, 32 Lincoln's Inn Fields, WC2A 3PH), unless specified otherwise.

Funding from NERA is gratefully acknowledged.

Entry is on a first-come first-served basis. No registration is required but places are limited. A light lunch will be available for everyone attending.

Seminar organisers: Professor Alessandro Gavazza and Dr Pasquale Schiraldi.

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• Next:

Monday  28 November 2016  12:30 - 14:00

Intermediation and Competition in Search Markets: An Empirical Case Study

Tobias Salz (NYU)

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32L 2.04, 2nd Floor Conference Room, LSE, 32 Lincoln's Inn Fields, London WC2A 3PH

• Full list for Michaelmas Term 2016

Monday  10 October 2016  12:30 - 14:00

Dynamic Bidding in Second Price Auctions

Maryam Saeedi (Tepper School of Business, Carnegie Mellon University)

32L 2.04, 2nd Floor Conference Room, LSE, 32 Lincoln's Inn Fields, London WC2A 3PH

Monday  17 October 2016  12:30 - 14:00

Estimating Equilibrium in Health Insurance Exchanges: Price Competition and Subsidy Design under the ACA

Pietro Tebaldi (University of Chicago)

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To design premium subsidies in a health insurance market it is necessary to estimate consumer demand and study how different subsidy schemes affect insurers’ incentives. Combining data from the Californian ACA marketplace with a model of insurance demand and insurers’ competition, I identify and estimate demand and cost primitives, and assess equilibrium outcomes under alternative subsidy designs. I find that vouchers are less distortionary than subsidies calculated from market premiums, and — given age-heterogeneity in demand and cost — tailoring subsidies to age leads to an equilibrium where all buyers are better off and per-person public spending is lower.

32L 2.04, 2nd Floor Conference Room, LSE, 32 Lincoln's Inn Fields, London WC2A 3PH

Monday  24 October 2016  12:30 - 14:00

Distorted Advice in the Mortgage Market: Theory and Structural Estimation

Andrea Pozzi (Einaudi Institute for Economics and Finance) , joint with Leonardo Gambacorta, Luigi Guiso, Paolo Mistrulli and Anton Tsoy

Complex financial decisions, such as choosing the mortgage type, require some degree of sophistication to form expectations about the future evolution of economic conditions. This provides banks, who often advise households, with an opportunity to steer unsophisticated households choices in a way that benefits them though not necessarily be in the household best interest. We set up a structural model of financial advice and estimate it exploiting administrative data on the universe of mortgages issued to Italian households. In the model, there are two types of households: Sophisticated households are perfectly informed and know which mortgage is best for them; naive households are instead susceptible to advice and will take the type of mortgage recommended by the bank. Each bank has an ideal mix of issued fixed and adjustable rate mortgages and attempts to achieve it by both appropriately setting the rates and strategically providing advice to its clientele. Banks compete in setting rates and households search. We recover the primitives of the model, in particular the share of “sophisticated” and “naive” households in the population, and use them to quantify the welfare implications of biased financial advice. In a counterfactual exercise, we study the effect of a financial literacy initiative which improves the general financial knowledge of the public reducing the scope for biased advice.

32L 2.04, 2nd Floor Conference Room, LSE, 32 Lincoln's Inn Fields, London WC2A 3PH

Monday  31 October 2016  12:30 - 14:00

The Market Power Effects of a Merger: Evidence from the U.S. Brewing Industry

Nathan Miller (Georgetown University)

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32L 2.04, 2nd Floor Conference Room, LSE, 32 Lincoln's Inn Fields, London WC2A 3PH

Monday  14 November 2016  12:30 - 14:00

Airline Services Agreements: A Structural Model of Network Formation

Marc Rysman (Boston University) , joint with Phillip McCalman (University of Melbourne)

Airline services agreements are necessary for direct flights between countries and consequently they are central to the operation of the commercial airline market. These agreements are bilateral in nature but their coverage is far from universal. To gain insight into why some agreements are signed but other links go unrealized, we study a new data set on airlines services agreements from the perspective of strategic network formation. We develop a structural model based on moment inequalities that uses the concepts of pairwise stability to generate estimating equations and also introduce methods to implement refinements of pairwise stability. The network structure is found to be important in determining the choices of countries to form agreements, and that the jointly optimal network of agreements would be substantially different than the observed outcome.

32L 2.04, 2nd Floor Conference Room, LSE, 32 Lincoln's Inn Fields, London WC2A 3PH

Monday  21 November 2016  12:30 - 14:00

Identification of Counterfactuals in Dynamic Discrete Choice Models

Myrto Kalouptsidi (Harvard University) , joint with Paul T. Scott and Eduardo Souza-Rodrigues

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32L 2.04, 2nd Floor Conference Room, LSE, 32 Lincoln's Inn Fields, London WC2A 3PH

Monday  28 November 2016  12:30 - 14:00

Intermediation and Competition in Search Markets: An Empirical Case Study

Tobias Salz (NYU)

Download Paper

32L 2.04, 2nd Floor Conference Room, LSE, 32 Lincoln's Inn Fields, London WC2A 3PH