The Hong Kong University of Science & Technology


Department of Economics








In Fall semester, Wednesday seminars will be held in Conference Room 5047 (5th floor, Lee Shau Kee Business Building, HKUST) while Friday seminars will be held in Conference Room 6045 (6th floor, Lee Shau Kee Business Building, HKUST) during 3:30 to 5:00 p.m.


Notes to visitors:

Department of Economics is located on the 6th floor of the Lee Shau Kee Business Building in the Lee Shau Kee Campus at the southern end of HKUST. To obtain a Chinese address of HKUST to show the taxi driver, click HERE  or download a location map HERE.  




** Joint seminar with IEMS **



Delivery Agents, Social Ties and Group Identity:

Theory and Evidence from a Two-Layered Field Experiment



Prof. Imran Rasul, University College London

coauthored with Oriana Bandiera (LSE), Robin Burgess (LSE), Erika Deserranno (Northwestern),

Ricardo Morel (BRAC) and Munshi Sulaiman (BRAC)



27 September 2017 (Wednesday) 

 3:30 - 5:00 p.m.  *IAS4042*



Abstract:    Individuals can have social preferences defined over their friends or share some group identity with: these lead to well-studied issues of favoritism and in-group bias. Such social preferences might also be endogenously shaped by the presence of rival groups. We study these issues in the context of a standard anti-poverty program, delivered by locally recruited delivery agents in villages in Uganda. We use a field experiment to study how the targeting of the program by delivery agents is shaped by the social ties delivery agents have and the social context of villages where they operate. Our design exploits: (i) experimental variation in the social ties of delivery agents to farmers within villages that we engineer; (ii) non-experimental variation in group identity and conflict between groups across villages. We find that delivery agents are: (i) significantly more likely to target households they are socially tied; (ii) among their social ties, they are significantly more likely to target households in their group rather than those in rival groups; (iii) this distinction is exacerbated in villages in which group conflict is most salient . We then measure the allocation and total coverage of the anti-poverty program relative to three benchmarks: (i) if delivery agents were self-interested; (ii) if delivery agents have social ties but display no group biases; (iii) the social planner’s objective of targeting the poorest households. We document when social contexts lead to allocative biases, and highlight that some contexts – where group rivalry is greatest – lead to greater coverage. Overall, the results suggest that greater conflict between groups can enhance targeting within groups by delivery agents: in line with delivery agents have social preferences defined by ‘parochial altruism’. More generally, development programs that leverage off locally hired agents need to account for the social ties of those agents and the social context in which they are asked to operate.






Deposit Requirements in Auctions



Prof. Xiaogang Che, Durham University

coauthored with Tong Li (Vanderbilt), Jingfeng Lu (NUS) and Xiaoyong Zheng (NCSU)



29 September 2017 (Friday) 

 3:30 - 5:00 p.m.  LSK6045



Abstract:    Deposit is a non-refundable reservation fee charged by the seller, which allows the winner to reserve the object prior to the final completion of transaction. In this paper, we examine the role of a deposit requirement in a (second-price and first-price) auction game in which there exists an ex-post outside option after bidding and the winner could default from the current transaction to take the option. We first characterize the equilibrium strategy for bidders and then the optimal choices of reserve price and deposit for the seller. Secondly, we establish the "expected revenue equivalence" across the second-price and first price auctions at the optimal choices. We finally discuss the impacts of other types of deposit requirements on the equilibrium strategies and the seller's choices.






A Theory of Organizational Dynamics: Internal Politics and Efficiency



Prof. Xi Weng, Peking University

coauthored with Hongbin Cai (Peking U) and Hong Feng (SWUFE)



4 October 2017 (Wednesday) 

 3:30 - 5:00 p.m.  LSK5047



Abstract:   We consider a three-member organization in which one member retires in each period and the incumbent members vote to admit a candidate to fill the vacancy. Candidates differ in quality and belong to one of two types, and majority-type members share the total rent of that period. We characterize the symmetric Markov equilibria with undominated strategies and compare the long-term welfare among them. Unanimity voting is better than majority voting at promoting long-term welfare. In addition, organizations with a certain degree of incongruity perform better in the long run than either harmonious or very divided organizations.






The Orgins of Firm Heterogeneity: A Production Network Approach



Prof. Andreas Moxnes, University  of Oslo & CPER

coauthored with Andrew B. Bernard (Dartmouth, CEP, CEPR & NBER), Emmanuel Dhyne (NBB & UMons),

Glenn C.G. Magerman (ULB & NBB) and Kalina Manova (Oxford, CEPR & CEP)



6 October 2017 (Friday) 

 3:30 - 5:00 p.m.  LSK6045



Abstract:    This paper quantifies the origins of firm size heterogeneity when firms are interconnected in a production network. We document new stylized facts about the universe of buyer-supplier relationships among all firms in Belgium during 2002-2014. These facts motivate a model in which firms buy inputs from upstream suppliers and sell to downstream buyers and final demand. Firms can be large not only because they interact with more, better and larger buyers and suppliers, and because they are better matched to their buyers and suppliers. The model delivers an exact decomposition of firm size into supply and demand margins with firm, buyer/supplier and match components. We establish three empirical results. First, demand factors explain 81% of firm size heterogeneity, while supply factors only 19%. Second, nearly all the variation on the demand side (99%) is driven by sales to other firms rather than final demand. By contrast, 88% of the variation on the supply side reflects heterogeneity in own production capability and 12% comes from input suppliers. Third, the extensive margin of the production network dominates the intensive margin. Most of the variance in the network demand and network supply components of firm size is determined by the number of customers and suppliers, rather than their size or capability. Second most important is that firms transact more with partners that are simultaneously more capable and better bilateral matches.






Prediction and Learning about Credit Card Spending



Prof. Jaimie Lien, Chinese University of Hong Kong

coauthored with Junji Xiao (UTS) and Liyin Jin (Fudan)



20 October 2017 (Friday) 

 3:30 - 5:00 p.m.  LSK6045



Abstract:    Many contracts require that consumers make estimates of their own future needs and behavior at the time of signing. We study the contract choices and service usage of credit card consumers with a choice between two possible credit card fee structures: a card with an upfront lump-sum fee without any spending requirement; and a card with an annual fee which can be waived if a minimum amount is charged to the card account in each year. This menu of contracts intends to screen consumers with different spending patterns based upon consumers’ own predictions about their future credit card needs. Using panel data of over 16,500 credit card accounts, we examine the extent to which consumers accurately predict their own credit card usage in their contract choice, and how they learn from their experiences with ex-post mistakes. Compared prior literature on fixed fee versus use-based fee contract selection, our study shows that contract choice and subsequent learning behavior depend on forward-looking incentives rather than an intrinsic appeal of payment schemes with single upfront payments. Following ex-post mistakes made in the first year of membership, consumers adjusted their spending behavior and contract continuation choice according to their future monetary incentives to do so. Finally, we examine the relationship between education and financial planning indicators in the credit card context. In the aggregate, the relationship between education and mistakes made is negative, while there is a positive relationship between mistakes, months of rolling debt, installment plan participation, and cash advance withdrawals.








Fall 2017


Date Speaker Affiliation Paper Title
1 Sep (Fri) Prof. Shengxing Zhang London School of Economics Intangibles, Inequality and Stagnation
6 Sep (Wed) Prof. Wen Quan University of Washington A Noncooperative Foundation of the Nash Rationing Solution
15 Sep (Fri) Prof. Denis Tkachenko National University of Singapore Using Arbitrary Precision Arithmetic to Sharpen Identification Analysis for DSGE Models
18 Sep (Mon)
LSK6045      3:30-5:00pm
Prof. David Dorn University of Zurich The Fall of the Labor Share and the Rise of Superstar Firms
20 Sep (Wed) Prof. Rachel Heath University of Washington Migrants, Information, and Working Conditions in Bangladeshi Garment Factories

27 Sep (Wed) 
Joint with IEMS *IAS4042*

Prof. Imran Rasul University College London

Delivery Agents, Social Ties and Group Identity:                                                                     Theory and Evidence from a Two-Layered Field Experiment

Please register:

29 Sep (Fri) Prof. Xiaogang Che Durham University Deposits Requirements in Auctions
4 Oct (Wed) Prof. Xi Weng Peking University A Theory of Organizational Dynamics: Internal Politics and Efficiency
6 Oct (Fri) Prof. Andreas Moxnes University of Oslo The Origins of Firm Heterogeneity: A Production Network Approach
13 Oct (Fri) Prof. Adam Szeidl Central European University  
20 Oct (Fri) Prof. Jaimie Lien The Chinese University of Hong Kong Prediction and Learning about Credit Card Spending
1 Nov (Wed) Prof. Heski Bar-Isaac University of Toronto  
3 Nov (Fri) Prof. Yiyi Zhou Stony Brook University Middlemen as Information Intermediaries: Evidence from the Used Car Markets
6 Nov (Mon)
Prof. Ulrich Mueller Princeton University Inference for the Mean
8 Nov (Wed) Prof. Jeff Ely Northwestern University  
10 Nov (Fri) Prof. Victor Aguirregabiria University of Toronto  
15 Nov (Wed) Prof. Shakeeb Khan Boston College  
17 Nov (Fri) Prof. Ulf von Lilienfeld-Toal University of Luxembourg  
22 Nov (Wed) Prof. Peter Newberry Pennsylvania State University Economies of Density in E-Commerce: A Study of Amazon's Fulfillment Center Network
24 Nov (Fri) Prof. Yangbo Song The Chinese University of Hong Kong, Shenzhen Finite Repeated Games with Learning of Actions
29 Nov (Wed) Prof. Arthur van Benthem University of Pennsylvania Sufficient Statistics for Imperfect Externality-Correcting Policies
1 Dec (Fri) Prof. Zhipeng Liao University of California, Los Angeles  
6 Dec (Wed) Prof. Felix Tintelnot University of Chicago  
13 Dec (Wed) Prof. Shuyang Sheng UCLA Estimation of Large Network Formation Games



Last modified: 22 September 2017