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A Kinky Consistency: Experimental Evidence of Behavior under Linear and Nonlinear Budget Constraints

By Emiliano Huet-Vaughn, Ethan M. L. McClure, and Juan Carlos Suárez Serrato

òòò½Íø Journal: Microeconomics, August 2024

Individuals face nonlinear incentives in myriad situations. We test a fundamental assumption in such settings: that individuals display stable preferences when facing linear and nonlinear incentives. We use a laboratory experiment to characterize how reve...

Concentration and Geographic Proximity in Antitrust Policy: Evidence from Bank Mergers

By David Benson, Samuel Blattner, Serafin Grundl, You Suk Kim, and Ken Onishi

òòò½Íø Journal: Microeconomics, August 2024

Antitrust often uses the Herfindahl-Hirschman Index (HHI) for merger screening and review. We argue that HHI-based antitrust policy using predefined markets in the banking industry misses anticompetitive effects that are predicted by the proximity of merg...

Monitoring Teams

By Marina Halac, Ilan Kremer, and Eyal Winter

òòò½Íø Journal: Microeconomics, August 2024

A principal incentivizes a group of agents to work by choosing a monitoring structure and a scheme of performance-contingent rewards. The monitoring structure partitions the set of agents into monitoring teams, each delivering a signal of joint performanc...

Monopolization with Must-Haves

By Enrique Ide and Juan-Pablo Montero

òòò½Íø Journal: Microeconomics, August 2024

An increasing number of monopolization cases have been constructed around the notion of "must-have" items: products that distributors must carry to "compete effectively." Motivated by these cases, we consider a multiproduct setting where upstream supplier...

Crowding in School Choice

By William Phan, Ryan Tierney, and Yu Zhou

òòò½Íø Review, August 2024

We consider the market design problem of matching students to schools in the presence of crowding effects. These effects are salient in parents' decision-making and the empirical literature; however, they cause difficulties in the design of satisfactory m...