MICROECONOMIC THEORY (Econ 713), 2ND HALF: INFORMATION ECONOMICS

     TTh 1:00-2:15pm, VAN HISE 594
     Professor: Marzena Rostek
     Office hours: Thursday, 2:30-3:30pm, 7440 SS

 


 

     SYLLABUS
    
All the official materials (problem sets etc.) will be posted at the Learn@UW.
 
     OUTLINE:
    
3/19: Axiomatization (what, why, how, relation to identification), Mixture set,
    
     Proof of Von Neumann-Morgenstern Theorem;
    
     Readings: MWG, pp. 175-8
 
    
3/21: Static Bayesian games (continuous strategy spaces), Bayesian Nash Equilibrium,
    
     Harsanyi's trick, Standard auction formats, First-price auction, Winner's curse;
    
     Readings: Gibbons 3.1.C, 3.2B+Appendix 3.2B, MWG, pp. 865-6
 
    
4/2: First-price auction (Linear equilibrium and general solution for the monotone BNE),
    
     Second-price auction;
    
     Readings: Jehle and Reny 9.1, 9.2.1-9.2.4
 
    
4/4: Revenue Equivalence Theorem, Stochastic orders, Double auction, Myerson-Satterthwaite
    
     Theorem;
    
     Readings: MWG 6.D, Gibbons 3.2.C, (Salanie 3.2.3, optional)
 
    
4/9: Adverse selection, Akerlof's Market for Lemons
    
     Readings: MWG 13.A-B (or Jehle and Reny 8.1.1))
 
    
4/16: Spence's Job Signaling model, Single-Crossing Property
    
    Readings: MWG 13.C (Gibbons 4.2.B offers a nice treatment, though itís not a substitute)
 
    
4/18: Costly signaling games, Equilibrium Dominance, Intuitive Criterion
    
    Readings: MWG Appendix A in Ch 13, The relevant part of Gibbons 4.4
 
    
4/23: Principal-agent problems, Screening, Price discrimination, Information rent
    
    Readings: Salanie 2.2, MWG 14.C
 
    
4/25: Moral hazard, Incentives versus risk sharing, Monotone Likelihood Ratio Property
    
    Readings: MWG 14.B

    
4/30: Costless signaling games, Partitional equilibrium
    
    Readings: Salanie 4.3.2 (Gibbons 4.3.A, optional)
 
    
5/2: Adverse selection with a continuum of types, Incentive compatibility in general mechanisms
    
    Readings: MWG, pp. 887-9 
 
    
5/7: Mechanism design, Direct mechanism, Revelation Principle
    
    Readings: MWG, pp. 884-5, 889-891

    
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