Competition | Center for Economic Policy

Publications Competitive Information Disclosure by Multiple Senders By Pak Hung Au, Keiichi Kawai

Publications Competitive Disclosure of Correlated Information By Pak Hung Au, Keiichi Kawai

Working Paper Series Settling Lawsuits with Pirates A firm licenses a product to overlapping generations of heterogeneous consumers. Consumers may purchase the product, pirate/steal it, or forego it. Higher consumer types enjoy higher gross benefits and are caught stealing at a higher rate. In this framework, the firm may commit to an out-of-court settlement policy that is “soft” on pirates, so high-types purchase the product and low-types steal the product until caught and subsequently settle. Settlement contracts, which include both cash payments and licenses for future product use, facilitate price discrimination. By Xinyu Hua, Kathryn E. Spier

Working Paper Series Merger Analysis in the App Economy: An Empirical Model of Ad-Sponsored Media This paper proposes a new model of imperfect competition of ad-sponsored media, which can sell “free” products, for a merger analysis applicable to the mobile app industry. To analyze developers' monetizing with both price and advertising in an app, we consider a consumer who faces both budget and time constraints. Moreover, to catch up with newly created and quickly redefined markets, we automate the conversion from in-text product descriptions to numerical product attributes by combining word embedding and dimension reduction techniques. By Kohei Kawaguchi (Sunada), Toshifumi Kuroda, Susumu Sato

Working Paper Series Attraction Versus Persuasion We consider a model of oligopolistic competition in a market with search frictions, in which competing firms with products of unknown quality advertise how much information a consumer’s visit will glean. We characterize the unique symmetric equilibrium of this game, which, due to the countervailing incentives of attraction and persuasion, generates a payoff function for each firm that is linear in the firm’s realized effective value. By Pak Hung Au, Mark Whitmeyer

Attraction and persuasion

Working Paper Series Search Algorithm, Repetitive Information, and Sales on Online Platforms A prominent feature of online sales is that buyers rely on the search tools offered by platforms to process information when searching for products. The authors develop a model that captures how the search algorithm affects buyers' search processes, which further influences market equilibrium and welfare. If a platform adopts a highly unequal search algorithm, buyers are likely to obtain repetitive information about a small group of sellers, which causes buyers to consider fewer options and suppresses competition. By Yangguang Huang, Yu Xie

Working Paper Series International Protection of Consumer Data We study the international protection of consumer data in a model where data from product sales generate additional revenue to firms but disutility to consumers. When data usage lacks transparency, a firm suffers a commitment problem and overuses consumer data. As transparency increases, the firm may adjust prices inefficiently across countries with different privacy preferences. By Xinyu Hua, Yongmin Chen, Keith E. Maskus

Workshop 2021 HKUST Workshop on Industrial Organization

Industrial Organization

Conference, Symposium, Forum, Seminar, Lecture, Talk Panel Discussion on Challenges Facing Competition Policy in Hong Kong and Asia

Research Affiliate Alminas Žaldokas Associate Professor, Department of Finance Professor Alminas Žaldokas is currently Associate Professor of Finance at the HKUST. He received his Ph.D. in Finance from INSEAD (France) and has worked as the Visiting Assistant Professor at the McCombs School of Business at the University of Texas in Austin.