An experimental study of bidding in contests of incomplete information

In many contest situations, such as R&D competition and rent seeking, participants’ costs are private information. We report the results of an experimental study of bidding in contests under different information and symmetry conditions about players’ costs of effort. The theory predicts qualitatively different comparative statics between bids under complete and incomplete information in contests of two and more than two players. We use a 2×3 experimental design, (n=2, n=4)×(symmetric complete information, asymmetric complete information, incomplete information), to test the theoretical predictions. We find the comparative statics of bids across the information and symmetry conditions, and the qualitative differences in comparative statics across group sizes, in partial agreement with the theory.     

Indefinitely repeated contests: An experimental study

Experimental Economics - We experimentally explore indefinitely repeated contests. Theory predicts more cooperation, in the form of lower expenditures, in indefinitely repeated contests with a...     

On the determinants of national saving: An extreme-bounds analysis

On the Determinants of Saving: An Extreme-Bounds Analysis. — We use extreme-bounds analysis to examine the reliability of estimates of various determinants of national saving. Results from the cross-sectional data are discouraging, for few of the standard determinants identified in the theoretical and empirical saving literature can pass robustness tests. However, our panel analysis is much more encouraging. We found agricultural share in total output, public saving, budget balance, and the current account balance are indeed robust. Furthermore, when we applied a modified form of sensitivity analysis, we found that seven variables are very robust. Generally, the most commonly specified determinants of saving provide limited guidance in understanding and predicting saving behavior.