Job Market Candidate
Department of Economics
579 Jane Stanford Way
Stanford, CA 94305
Available for Virtual Interviews, including at:
- ASSA Annual Meeting and EEA Annual Meeting
Job Market Paper|
Unraveling and Inefficient Matching   [click here for video summary]
Labor markets are said to unravel if the matches between workers and firms occur inefficiently early, based on limited information. I argue that a significant determinant of unraveling is the transparency of the secondary market, where firms can poach workers employed by other firms. I propose a model of interviewing and hiring that allows firms to hire on the secondary market as well as at the entry-level. Unraveling arises as a strategic decision by low-tier firms to prevent poaching. While early matching reduces the probability of hiring a high-type worker, it prevents rivals from learning about the worker, making poaching difficult. As a result, unraveling can occur even in labor markets without a shortage of talent. When secondary markets are very transparent, unraveling disappears. However, the resulting matching is still inefficient due to the incentives of low-tier firms to communicate that they have not hired top-quality workers. Coordinating the timing of hiring does not mitigate the inefficiencies because firms continue to act strategically to prevent poaching.
Matching Theory with Recent Applications (with Fuhito Kojima and Fanqi Shi)
Encyclopedia of Complexity and Systems Science, 2018
Losing Money to Make Money: The Benefits of Salary Compression
Professional sports in the United States generate over 35 billion dollars yearly in revenue, which is divided between owners and players via collective bargaining. Given the stakes, some leagues instituted maximum contracts, limiting individual compensation to a percentage of team salary caps. Combining a model of a sports league with one of bargaining, I demonstrate that while these contracts limit salaries of star players, they can increase the welfare of all players. Maximum contracts reduce earning inequality and harmonize players' interests, improving collective bargaining power. The model highlights the welfare gains to be had if a heterogeneous group agrees to concessions that increase the alignment of their individual interests.
Strategic Influencers and the Shaping of Beliefs
Influencers, such as lobbyists or media outlets, seek to drive the beliefs of agents in a network in a particular direction. If limited in resources, should they target agents with similar beliefs to them or more central agents? Absent competition, an influencer trades off an agent's centrality with the dissimilarity of the agent's belief. Under competition, influencers must take into account the messages an agent receives from other sources. This introduces a first-order benefit to deterring one's rival. Under intense competition, the deterrence effect dominates. Equilibria where influencers target agents with similar beliefs arise, increasing polarization in the network. These dynamics are in contrast to the canonical model of an influencer who cares only about exposure. In that case, independent of competition, the targeting strategy is based entirely on agents' centrality.
Testing Alone is Insufficient (with Rahul Deb, Mallesh Pai, and Rakesh Vohra)
In a pandemic, fear of infection limits economic activity even after reopening. Widespread testing alone will not alleviate this problem. We argue that targeted testing in concert with targeted subsidies is essential. We propose a model with these features to determine where agents should be tested and how they should be incentivized. Agents that have a low wage, a high risk of infection, and bear a large cost of falling ill, should be tested at work. When testing is very costly, agents that have high wages and low expected costs associated with falling ill should be tested at home.
Work in Progress
Political Polarization as a Means of Party Discipline
I demonstrate that polarization can arise as a strategic decision by political parties, independent of the distribution of voter preferences in the electorate. I develop a two-period model where two parties compete in consecutive elections. The winner of the first election implements a policy, and voters observe whether the choice is consistent with the party platform. Voters then decide whether to re-elect the incumbent or elect the opposition party. A policy is selected by the winner, and cumulative payoffs are realized. Polarization, measured as the distance between party platforms, emerges endogenously. When it is difficult to effectively screen out candidates with agendas different from the platform, political parties utilize polarization to encourage party discipline. Voters are willing to support a more extreme party in the first period as party discipline reduces the variance of the implemented policy. Consequently, parties compete on this front, but voters are worse off because they prefer no polarization.
Diffusion and Adoption of Collaborative Technologies (with Matthew Jackson and Sida Peng)
Matching in Interview Markets (with Itai Ashlagi, Irene Lo, Marc Melcher, Alvin Roth, Erling Skancke, and Irene Wapnir)
Unraveling in College Athletic Scholarship Offers (with John Horowitz)