En poursuivant votre navigation, vous acceptez l'utilisation de cookies destinés à améliorer la performance de ce site et à vous proposer des services et contenus personnalisés.

X

LUNCH SEMINAR 2015-2016

Lundi 20 juin 2016

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Etienne LEHMANN (CRED University Pantheon Assas II) (with Kory Kroft (Toronto, NBER), Kavan Kucko (Boston university), Johannes Schmieder (Boston University, NBER and IZA)

« Optimal Income Taxation with Unemployment and Wage Responses : A Sufficient Statistics Approach »

We derive a sufficient statistics optimal tax formula in a general model that incorporates  ​unemployment and endogenous wages, to study the shape of the tax and transfer system at​ ​the bottom of the distribution. The sufficient statistics are the macro employment response to​ taxation and the micro and macro participation responses. We estimate these statistics using​ policy variation from the U.S. tax and transfer system. Our results suggest that the optimal tax​ more closely resembles a Negative Income Tax than an Earned Income Tax Credit relative to​ ​the case where unemployment and wage responses are not taken into account.

*****

Lundi 13 juin 2016

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Diana MACDONALD (Arizona State University) (with Hector Chade, Arizona State University)

« Assortative Matching with On-the-match Search »

On-the-match search is a natural and realistic feature of many markets, such as labor markets, marriage markets, and partnership formation. We develop a two-sided matching model with heterogeneous agents where search frictions are present. Agents search for partners both while unmatched and matched, and hence matches or partnerships can be broken. The presence of on-the-match search implies that agents not only care about the payoff received from the match, but also the probability that the partner leaves and they become unmatched. Therefore, even if the instantaneous payoff is strictly increasing in partner's types, higher partners are not always preferred. Moreover, given that match-status and match-partners evolve over time, we need to provide a suitable definition for Positive Assortative Matching (PAM) for this environment. In particular, we define PAM in a stochastic sense, we say that the sorting exhibits PAM if the conditional cumulative distribution over partners characteristics is increasing in the agent's attribute. Intuitively, higher-type agents are more likely to have higher-type partners. We find that when agents are either high or low and the instantaneous payoff is strictly non-transferable, a payoff function increasing in partner's attribute is a sufficient condition for PAM.

*****

Lundi 6 juin 2016

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Pierre PICARD

« Nitpicky Insurers and the Law of Contracts »

Conditioning insurance indemnities on the circumstances of the loss improves the risk sharing-incentive trade-off under moral hazard. If the insurer can offer complete contracts that specify the indemnity payment under all possible circumstances, then the optimal coverage depends at the same time on the policyholder's loss and on a signal that reflects the likelihood of a high or low level of effort according to the circumstances. When circumstances cannot be exhaustively described in the insurance policy, this conditioning may go through legal disputes. We show how the law of contracts should at the same time provide leeway to insurers to cut the indemnity in unfavorable circumstances in order to provide incentives to effort, but it should also limit the opportunism of insurers who may be willing to exaggeratedly cut claims in circumstances where policyholders' defence would be prohibitively costly.

*****

Lundi 30 mai 2016

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Rida LARAKI (with Michel Balinski)

« Majority Judgment vs Majority Rule »

The validity of majority rule in an election with but two candidates—and so also of Condorcet consistency—is challenged. Axioms based on measures—paralleling those of K. O. May characterizing majority rule for two candidates based on comparisons—lead to another method that is unique in agreeing with the majority rule on pairs of “polarized” candidates. The method—majority judgment—meets R. A. Dahl’s requirement that an apathetic majority does not always defeat an intense minority. It is a practical method that accommodates any number of candidates, avoids both the Condorcet and Arrow paradoxes, and best resists strategic manipulation.

*****

Lundi 23 mai 2016

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Geoffrey BARROWS (Grantham Insitute) (with Hélène Ollivier (PSE))

« Does Trade Make Firms Cleaner ? Theory and Evidence from Indian Manufacturing »

This paper investigates the impact of exporting on the CO2 emission intensity of manufacturing firms in India. Recent papers have argued that export market access encourages firms to upgrade technology, which lowers the emission intensity of production; however, data limitations confound previous attempts to separately identify productivity impacts from simultaneous changes in prices and product-mix. We present a model of how these alternative channels could also explain the results documented in the literature.

Then, using a highly detailed production dataset of large Indian manufacturing firms that contains information on physical units of inputs and outputs by product, we are able to decompose the overall firm impact into three components – prices, product-mix, and technology. Export impacts at the firm level are identified from import demand shocks of foreign trading partners. We find that prices systematically bias down estimates of emission intensity in value, that firms adjust emission intensity in quantity through changing output shares across products, but that firms do not lower emission intensity

within products over time (technology). The results imply that the productivity benefits from market integration alone are not enough to induce clean technology adoption.

*****

 

Lundi 9 mai 2016

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Alexis LOUAAS (with Arnaud Goussebaile)

« Falling to insure low-probability risks : the role of capital requirements »

Why are catastrophic events so difficult to insure? Their extreme severity advocates for a wide-spread use of insurance, yet they are typically excluded from US homeowner policies. It is also puzzling to notice that some low-probability risks such as damages from lightnings are covered under all US homeowner policies whereas others, such as earthquakes and floods are not. Our model explains this puzzle by showing that the effect of aggregate uncertainty, a well-known threat to insurability, is amplified when the individual loss probability is small. Low-probability risks with aggregate uncertainty, such as earthquakes and floods, therefore display lower insurance take-up rates than low-probability risks without aggregate uncertainty such as lightning strikes.

*****

Lundi 11 avril 2016

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Julia WIRTZ (University of Bonn)

« Feedback and Learning in Tournaments »

We study the optimal feedback policy in a dynamic tournament with strategic experimentation. In many situations performance feedback is needed for agents to evaluate the quality of their work and adjust their strategy accordingly. Feedback makes it possible to learn about the productivity of a technology or the potential of a project and to discard one in favour of a new one after negative feedback. However, in a tournament setting, such as when agents compete for a promotion, precise feedback does not implement the output-maximizing technology choice. The leader of the tournament will hold on to a subpar technology if she has a sufficient lead while the follower will discard an above-average technology to have a chance to catch up with the leader. A different inefficiency emerges with private feedback, where the competitor's performance is not revealed. Agents discard moderately above-average technologies in order to compete with an opponent who has an increased expected performance due to his strategic switching behavior. We show that the efficient switching decision can be induced with partial feedback, where the principal restricts herself to giving recommendations to switch or keep the technology when it is efficient to do so. In a setting where agents both choose technology and costly effort partial feedback continues to be the superior policy. Among the considered policies, partial feedback induces the highest level of effort.

*****

Lundi 21 mars 2016

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Bertrand CANDELON (IPAG)(with Sessi Tokpavi)

« A Non-parametric Test for Granger Causality in Distribution with Application to Financial Contagion »

This paper introduces a kernel-based non-parametric inferential procedure to test for Granger causality in distribution. This test is a multivariate extension of the kernel-based Granger causality test in tail event introduced by Hong et al. 2009. The main advantage of this test is its ability to examine a large number of lags, with higher-order lags discounted. In addition, our test is highly flexible because it can be used to identify Granger causality in specific regions on the distribution supports, such as the center or tails. We prove that the test converges asymptotically to a standard Gaussian distribution under the null hypothesis and thus is free of parameter estimation uncertainty. Monte Carlo simulations illustrate the excellent small sample size and power properties of the test. This new test is applied to a set of European stock markets to analyze spillovers during the recent European crisis and to distinguish contagion from interdependence effects.

*****

Lundi 14 mars 2016

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Amanda FRIEDENBERG (Arizona State University)

« Second-Order Optimism and Inefficient Agreements »

This paper provides a novel understanding of inefficient delays in reaching agreements: second-order optimism. Under second-order optimism, it is "common knowledge'' that there will be delays in reaching agreement. Nonetheless, negotiators do not put forward offers that are objectively preferred by both parties, because they fear that, by doing so, the other party will become more optimistic about their future prospects.  The paper shows that rational strategically sophisticated bargainers may well face such second-order optimism and this can give rise to inefficient delays in reaching agreements.  Moreover, when there are delays, it must be an artifact of second-order optimism.  The paper goes on to characterize the behavioral implications of delayed agreements that arise from second-order optimism.

*****

Lundi 7 mars 2016

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Leonardo PEJSACHOWICZ

« Choice Deferral, Indecisiveness and Preference for Flexibility »

We consider a representation of menu preferences in which observed behavior may only partially reveal inner tastes. The latter are modeled by means of a possibly incomplete (but otherwise rational) preference relation P, the former by a completion P* of that relation. The two are connected by a rule formalizing the intuitive idea that :''Whenever in doubt, don't commit, just leave options open''. Under the usual assumptions of the menu choice literature, we find that even the smallest amount of indecisiveness is enough to force P^*, through this deferral property, to exhibit preference for flexibility on the entire domain.

Thus we highlight a fundamental tension between non-monotonic preferences, such as preferences for self-contro, and deferral due to ndecisiveness.

*****

Lundi 15 février 2016

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Pierre BOYER (with Christoph Esslinger)

« Public debt and the political economy of reforms »

We show that a decisive factor to implement beneficial reforms by the political process is the interaction between the reform decision and the decision to raise public debt. We consider a two-period model in which two politicians compete for election in each period. They do so by targeting available resources to subsets of voters. This tactical redistribution does not imply any efficiency gain. In the first period, the two politicians also propose whether to implement an efficient reform that costs resources today but will yield higher benefits in the future. Additionally, they choose the level of public debt. As main result we show that the ability to raise public debt is the key determinant to sustain the efficient reform in the political equilibirum. We also show that debt becomes less effective to promote reforms when the reforms generate mainly non-targetable public good benefits.

*****

Lundi 8 février 2016

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Olivier GOSSNER (with Kyna Fong, Johannes Hömer and Yuliy Sannikov)

« Dynamic Bank Runs »

We examine dynamic models of bank runs with imperfect monitoring. Our model admits a unique equilibrium in threshold strategies, and we discuss its comparative statics with regards to player’s information and fundamentals of the economy.

*****

Lundi 2 janvier 2016

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Isabelle MÉJEAN (with Julian di Giovanni (University Pompeu Fabra) and Andrei Levchencko (University of Michigan)

« The Micro Origins of International Business Cycle Comovement »

This paper investigates the role of individual firms in international business cycle comovement using data covering the universe of French firm-level value added, bilateral imports and exports, and cross-border ownership over the period 1993-2007. At the micro level, controlling for firm and country effects, trade in goods with a particular foreign country is associated with a significantly higher correlation between a firm and that foreign country. In addition, foreign multinational affiliates operating in France are significantly more correlated with the source economy. The impact of direct trade and multinational linkages on comovement at the micro level has significant macro implications. Because internationally connected firms are systematically larger than non-internationally connected firms, the firms directly linked to foreign countries represent only 8% of all firms, but 56% of all value added, and account for 75% of the observed aggregate comovement. Without those linkages the correlation between France and foreign countries would fall by about 0.091, or one-third of the observed average business cycle correlation of 0.29 in our sample of partner countries. These results are evidence of transmission of business cycle shocks through direct trade and multinational ownership linkages at the firm level.

*****

Lundi 14 décembre 2015

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Faddy ARDIAN (with Silvia Concettini and Anna Creti)

« The effect of intermittent renewable generation on congestion in Italy »

The recent literature analysing the impact of increasing production from renewable power sources on wholesale electricity prices often em- phasizes the likely reductions on equilibrium prices originated from the displacement of higher variable cost production in the merit order ranking. Nevertheless, there is another aspect which has been somehow ne- glected in this debate, namely the impact of geographical location of newly built generation facilities on the electricity prices. Indeed, given the fact that renewable generation technologies exploit natural resources, some geographical areas may be particularly well suited to the detriment of others for the installation of new capacity. When national electricity markets are organized as two or more inter-connected sub-markets whose boundaries are determined on the basis of existing or planned transmission facilities, the final impact on equilibrium prices of increased gen- eration from renewable sources may result be less straightforward than the existing literature would suggest. As a matter of fact, when the renewable capacity is concentrated in particular areas the larger renewable output may multiply the incidence of transmission congestions.

This article aims at testing the possible consequences of this phenomenon on the Italian electricity market. We have firstly built a unique database collecting information from several sources: GME, the market operator, which publishes the hourly offers in the day-ahead market to- gether with equilibrium prices, quantities and inter-zonal transits; GSE, the state-owned company promoting and supporting renewable energy sources in Italy, which provides information about the geographical distribution of installed capacity; Terna, the network operator, which registers the the actual generation from different power sources after the closure of all markets; REF-E, a consulting group, which has created a list of Italian power plants classified by technology and geographical location. We have estimated then two econometric models: a multinomial logit model and an OLS model performed on all interconnected geographical sub-market pairs in Italy using observations from a three year period (2010-2012). The results suggest that the increase of renewable production coupled with low demand reduce the congestion occurrence directed to zone that is generally importing electricity, whereas larger hydro productions provide an opposite effect to the congestion from these zones. The same behavior in price difference is also observed, particularly in the zones with limited interzonal transits and hydro generation. Then, zones that imports electricity production based from gas or oil will have their occurrence of congestion reduced whenever the price of the source decreases. These results have substantials implications for the design of Italian electricity market.

*****

Lundi 7 décembre 2015

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Raphaël LEVY (Université de Mannheim)

« Horizontal reputation »

We consider an agent with non-monotonic career concerns, i.e., whose reputational reward is higher when perceived as closer to an interior bliss reputation. Career concerns give rise to multiple equilibria characterized by repositioning towards the ideal reputation. A better equilibrium in which repositioning is moderate and reputation-building increases welfare coexists with a less efficient equilibrium where repositioning is extreme, and welfare may be even lower than in the absence of reputation concerns. In the presence of multiple receivers, the inefficiency of the worse equilibrium is exacerbated by the (endogenous) selection of inefficiently narrow and congruent audiences.

*****

Lundi 30 novembre 2015 (annulé)

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Faddy ARDIAN (with Silvia Concettini and Anna Creti)

« The effect of intermittent renewable generation on congestion in Italy »

The recent literature analysing the impact of increasing production from renewable power sources on wholesale electricity prices often em- phasizes the likely reductions on equilibrium prices originated from the displacement of higher variable cost production in the merit order ranking. Nevertheless, there is another aspect which has been somehow ne- glected in this debate, namely the impact of geographical location of newly built generation facilities on the electricity prices. Indeed, given the fact that renewable generation technologies exploit natural resources, some geographical areas may be particularly well suited to the detriment of others for the installation of new capacity. When national electricity markets are organized as two or more inter-connected sub-markets whose boundaries are determined on the basis of existing or planned transmission facilities, the final impact on equilibrium prices of increased gen- eration from renewable sources may result be less straightforward than the existing literature would suggest. As a matter of fact, when the renewable capacity is concentrated in particular areas the larger renewable output may multiply the incidence of transmission congestions.

This article aims at testing the possible consequences of this phenomenon on the Italian electricity market. We have firstly built a unique database collecting information from several sources: GME, the market operator, which publishes the hourly offers in the day-ahead market to- gether with equilibrium prices, quantities and inter-zonal transits; GSE, the state-owned company promoting and supporting renewable energy sources in Italy, which provides information about the geographical distribution of installed capacity; Terna, the network operator, which registers the the actual generation from different power sources after the closure of all markets; REF-E, a consulting group, which has created a list of Italian power plants classified by technology and geographical location. We have estimated then two econometric models: a multinomial logit model and an OLS model performed on all interconnected geographical sub-market pairs in Italy using observations from a three year period (2010-2012). The results suggest that the increase of renewable production coupled with low demand reduce the congestion occurrence directed to zone that is generally importing electricity, whereas larger hydro productions provide an opposite effect to the congestion from these zones. The same behavior in price difference is also observed, particularly in the zones with limited interzonal transits and hydro generation. Then, zones that imports electricity production based from gas or oil will have their occurrence of congestion reduced whenever the price of the source decreases. These results have substantials implications for the design of Italian electricity market.

*****

Lundi 23 novembre 2015

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Eduardo PEREZ

« Persuasion and the value of exogenous information »

Do the end users of information always benefit from exogenous information? Based on Blackwell's theorem, it might be tempting to think so. We show that this is not necessarily the case when the decision maker is is also informed by a persuader who  ex ante chooses her information structure, as in Bayesian persuasion models. In this case, the exogenous information may lead the designer to adopt a less transparent information structure in a way that hurts the receiver. This is true whether or not the designer can condition the information structure on the realized leak. With two actions, or two states of the world, however, exogenous public information is always beneficial for the receiver.

*****

Lundi 16 novembre 2015

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Pierre PICARD (with Pierre Martinon and Anasuya Raj)

« On the design of optimal health insurance contracts under ex post moral hazard »

We analyze the design of an optimal medical insurance contract under ex post moral hazard, i.e., when illness severity cannot be observed by insurers and policyholders decide on their health expenditures. We characterize the trade-off between ex ante risk sharing and ex post incentive compatibility in an optimal revelation mechanism under hidden information and risk aversion. We show that the optimal contract provides partial insurance at the margin, with a deductible when insurers' rates are affected by a positive loading. We also provide conditions under which an upper limit on coverage is optimal. We show that the possibility to audit the health state leads to an upper limit on out of pocket expenses.

*****

Lundi 9 novembre 2015

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Jeanne COMMAULT

« Measuring the Consumption Response To Income  Shocks When Consumers Have A Precautionary Motive »

This paper estimates the response of consumption to permanent and transitory income shocks when consumption growth is allowed to depend on the history of past shocks. Existing estimators assume away this correlation, though it is present in the standard intertemporal optimization model of consumption because of precautionary behavior: good shocks in the past raise the current assets accumulated and relax the need for precautionary saving, reducing consumption growth. A similar correlation emerges in the presence of credit constraints. Correcting for the possibility of history dependence causes the estimated response to a permanent shock to fall significantly from 0.64 to 0.35 and the response to a transitory shock to rise from 0.05 to 0.18.

*****

Lundi 2 novembre 2015

12h15 –13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Jean-Marc BOURGEON

« Optimal territorial design and decentralization »

We consider a multi-tier government in charge of providing a bundle of public goods to a large and diverse population. Public goods differ in both their provision cost and their access cost for the citizens. We characterize the optimal territorial organization, i.e. the number of tiers and jurisdictions per tier, their administration capacity and the range of public goods provided at each tier. The shape of the territorial organization depends on the valuation of the administrations' capacity and of the public goods, and on the provision costs and access costs. Low valuation parameters in comparison to the cost parameters lead a country to adopt a territorial organization with a tall pyramid shape, i.e., a large number of tiers composed of few jurisdictions with limited competences. By contrast, if valuations are high relative to costs, the territorial pyramid is small and jurisdictions provide a wide range of public goods. In any case, going down the territorial pyramid, the jurisdictions' range of competencies increases but their administration capacity decreases. We then investigate the impact of decentralized decision-making. Even though sub-national governments have an incentive to carry out some competencies assigned to other tiers, the social planner can implement the tiers' first-best scopes without altering the first-best territorial pyramid. However, we show that the optimal territorial organization under decentralization entails a lower number of tiers, with more jurisdictions per tier and larger ranges of competences.

*****

Lundi 28 septembre 2015

12h15 – 13h15

Bibliothèque rez-de-chaussée – Département d’Economie

Jean-Baptiste MICHAU

« Secular Stagnation : Theory and Remedies »

This paper relies on a Ramsey model with money to offer a simple theory of secular stagnation. The permanent failure of the economy to produce at full capacity results from three features: (i) The combination of the zero lower bound on the nominal interest rate together with an inflation ceiling creates a lower bound on the real interest rate; (ii) Some dynastic households have a high propensity to save, due to a preference for wealth; (iii) A downward wage rigidity breaks the deflationary spiral resulting from the lack of demand. In this framework, I derive the paradox of flexibility, of thrift, and of toil.

If the inflation ceiling cannot be raised, then the government needs to rely on fiscal policy to escape secular stagnation. However, a conventional fiscal stimulus is not an efficient response to a permanent liquidity trap, and can even be welfare reducing. The solution is instead to tax the wealth of households and to subsidize the income from physical capital, though an investment subsidy or a reduction in the taxation of corporate income. This optimal policy is revenue neutral and implements the first-best allocation of resources. However, it induces the economy to produce at full capacity and therefore forces the government to redeem the money that had previously been supplied to finance public deficits.