# Working Papers

### Full Substitutability

(joint with **John W. Hatfield, Scott D. Kominers, Michael Ostrovsky, and Alexander Westkamp**)*Stanford University, Working Paper Series - updated Aug 2018 (forthcoming, Theoretical Economics)*

Abstract: Various forms of substitutability are essential for establishing the existence of equilibria and other useful properties in diverse settings such as matching, auctions, and exchange economies with indivisible goods. We extend earlier models’ definitions of substitutability to settings in which each agent can be both a buyer in some transactions and a seller in others, and show that all these definitions are equivalent. We then introduce a new class of substitutable preferences that allows us to model intermediaries with production capacity. We also prove that substitutability is preserved under economically important transformations such as trade endowments, mergers, and limited liability.

### Serial Dictatorship Mechanisms with Reservation Prices

(joint with **Bettina E. Klaus**)*University of Lausanne, Working Paper Series, May 2017 - updated April 2018. (R&R, Economic Theory)*

Abstract: We propose a new set of mechanisms, which we call serial dictatorship mechanisms with reservation prices for the allocation of one indivisible good. We show that a mechanism satisfies minimal tradability, individual rationality, strategy-proofness, consistency, and non wasteful tie-breaking if and only if there exists a reservation price vector and a priority ordering such that the mechanism is a serial dictatorship mechanism with reservation prices. We obtain a second characterization by replacing individual rationality with non-imposition. In both our characterizations the reservation price vector, the priority ordering, and the mechanism are all found simultaneously and endogenously from the properties. In addition, we show that in our model a mechanism satisfies Pareto efficiency, strategy-proofness, and consistency if and only if it is welfare equivalent to a classical serial dictatorship. Finally, we illustrate how the normative requirements governing the functioning of some real life markets and the mechanisms that these markets use are reasonably well captured by our model and results.

### Chain Stability in Trading Networks

(joint with **John W. Hatfield, Scott D. Kominers, Michael Ostrovsky, and Alexander Westkamp**)*Stanford University, Working Paper Series, April 2015 - updated June 2018. (R&R, Econometrica)*

Extended abstract, Proceedings of the 18th ACM Conference on Electronic Commerce, (2018), pp. 617.

Abstract: We show that in general trading networks with bilateral contracts, a suitably adapted chain stability concept (Ostrovsky, 2008) is equivalent to stability (Hatfield and Kominers, 2012; Hatfield et al., 2013) if all agents’ preferences are jointly fully substitutable and satisfy the Laws of Aggregate Supply and Demand. We also show that in the special case of trading networks with transferable utility, an outcome is consistent with competitive equilibrium if and only if it is not blocked by any chain of contracts. Moreover, from a computational perspective, checking whether an outcome is chain stable is substantially easier than directly checking whether an outcome is stable.

### Targeted vs. Collective Information Sharing in Social Networks

(joint with **Alexey Kushnir**)*Carnegie Mellon University, Working Paper Series, April 2014.*

Abstract: We introduce a simple two-stage game of endogenous network formation and information sharing for reasoning about the optimal design of social networks like Facebook or Google+. We distinguish between unilateral and bilateral connections and between targeted and collective information sharing. Agents value being connected to other agents and sharing and receiving information. We consider multiple utility specifications. We show that the game always has an equilibrium in pure strategies and then we study how the network design and the utility specifications affect welfare. Surprisingly, we find that in general, targeted information sharing is not necessarily better than collective information sharing. However, if all agents are either “babblers” or “friends”, irrespective of whether the network is unilateral or bilateral, in equilibrium, targeted information sharing yields higher welfare than collective information sharing.

# Published Papers

### Stability and Competitive Equilibrium in Trading Networks

(joint with **John W. Hatfield, Scott D. Kominers, Michael Ostrovsky, and Alexander Westkamp**)*Journal of Political Economy, v. 121(5), October 2013, pp. 966-1005. - **Online Appendix**.*

Abstract: In models of matching in networks, when transfers are not allowed or are only allowed to be discrete, both substitutability of preferences and supply chain structure of the contractual set are required for the guaranteed existence of stable outcomes. We show that when continuous transfers are allowed and utility is quasilinear, the substitutability of preferences is on its own both sufficient and necessary for the guaranteed existence of stable outcomes. Furthermore, when preferences are substitutable, the set of stable outcomes is equivalent to the set of competitive equilibria, and all stable allocations are efficient.

### The Intellectual Influence of Economic Journals: Quality versus Quantity

(joint with **László Á. Kóczy**)*Economic Theory, v.52(3), April 2013, pp. 863-884.*

Abstract: The evaluation of scientific output has a key role in the allocation of research funds and academic positions. Decisions are often based on quality indicators for academic journals and over the years a handful of scoring methods have been proposed for this purpose. Discussing the most prominent methods (de facto standards) we show that they do not distinguish quality from quantity at article level. The systematic bias we find is analytically tractable and implies that the methods are manipulable. We introduce modified methods that correct for this bias, and use them to provide rankings of economic journals. Our methodology is transparent; our results are replicable.

### Consistency in One-Sided Assignment Problems

(joint with **Bettina E. Klaus**)*Social Choice and Welfare, v.35(3), September 2010, pp. 415-433.*

Abstract: One-sided assignment problems combine important features of two well-known matching models. First, as in roommate problems, any two agents can be matched and second, as in two-sided assignment problems, the division of payoffs to agents is flexible as part of the solution. We take a similar approach to one-sided assignment problems as Sasaki (Int J Game Theory 24:373–397, 1995) for two-sided assignment problems, and we analyze various desirable properties of solutions including consistency and weak pairwise-monotonicity. We show that for the class of solvable one-sided assignment problems (i.e., the subset of one-sided assignment problems with a non-empty core), if a subsolution of the core satisfies [*Pareto indifference and consistency*] or [*invariance with respect to unmatching dummy pairs, continuity, and consistency*], then it coincides with the core (Theorems 1 and 2). However, we also prove that on the class of all one-sided assignment problems (solvable or not), no solution satisfies consistency and coincides with the core whenever the core is non-empty (Theorem 4). Finally, we comment on the difficulty in obtaining further positive results for the class of solvable one-sided assignment problems in line with Sasaki's (1995) characterizations of the core for two-sided assignment problems.