This paper considers equilibrium directed search with a finite number of heterogeneous workers and firms, where firms compete in direct mechanisms. Unlike previous findings, Nash equilibrium here does solve the problem of coordination failure. Restricting the match value function to be supermodular, and that firms use truthful strategies also imply positive assortative matching and decentralize...

For the case of two buyers we show that equilibrium in the sealed high-bid auction is unique when (i) buyers’ reservations prices are drawn independently from distributions with finite support and positive mass at the lower endpoint; (ii) buyers have private values; and (iii) buyers’ preferences are log supermodular. For more than two buyers, we obtain the same result under the additional assum...

In this lecture, we develop the theory of supermodular games; key references are the papers of Topkis [7], Vives [8], and Milgrom and Roberts [3]. Our development closely follows that of Milgrom and Roberts, though we will also note other references where necessary. We start with some basic definitions and facts about lattices. Given a set X, a binary relation is a partial ordering on X if it i...

This paper uses a mechanism design framework to characterize how an intermediary can design profit-maximizing matching markets when agents have private information about their quality. When match surpluses are supermodular, sufficient conditions are provided that ensure positive assortative matching is profit maximizing. Under these conditions, two-sided position auctions are characterized that...

This paper investigates absorption and global accessibility under perfect foresight dynamics in games with linear incentives. An action distribution in the society is absorbing if there is no equilibrium path escaping from the distribution, and globally accessible if, from every initial distribution, there exists an equilibrium path which converges to the distribution. Using time symmetry of th...

This paper is concerned with several types of ruin probabilities for a multivariate compound Poisson risk model, where the claim size vector follows a multivariate phase type distribution. First, an explicit representation for the convolution of a multivariate phase type distribution is derived, and then an explicit formula for the ruin probability that the total claim surplus exceeds the total...

This paper studies the conditions under which the scarcity of a factor (in particular, labor) encourages technological progress and technology adoption. In standard endogenous growth models, which feature a strong scale e¤ect, an increase in the supply of labor encourages technological progress. In contrast, the famous Habakkuk hypothesis in economic history claims that technological progress w...

In this paper we pursue the line of research initiated by Haller et al. (2005). We examine the existence of equilibrium networks called Nash networks in the noncooperative two-way flow model of Bala and Goyal (2000) in the presence of partner heterogeneity. First, we show through an example that Nash networks in pure strategies do not always exist in such model. We then impose restrictions on t...

Wage and income surveys covering the period 1989-1999 are used to display changes in inequality of earnings and main factors of disparities. In the first part, increasing differences in the Czech Republic and the decreasing weight of demographic characteristics in wage structure are observed. In the second part, available evidence on cross-national comparison is gathered in order to demonstrate...

We exploit qualitative probabilistic relationships among variables for computing bounds of con­ ditional probability distributions of interest in Bayesian networks. Using the signs of qualita­ tive relationships, we can implement abstraction operations that are guaranteed to bound the dis­ tributions of interest in the desired direction. By evaluating incrementally improved approximate networks...