Deterring Ineffcient Gambling in Risk-Taking Agents
By Ryan Westphal This paper proposes a model describing the incentive issues faced by principals and agents when the agent has limited liability and is capable of undertaking unidentifiable, inefficient risky behavior. We propose a contract structure by which the principal deters risk by deferring payment to the agent until she reaches an absorbing steady-state […]
Faith in the Future and Social Conflict: Economic Growth as a Mechanism for Political Stabilization
By Alexander Bloedel This paper studies the mechanisms that link sociopolitical conflict and (expectations about) economic prosperity. Motivated by a large body of empirical and historical work on the correlation between economic development and democratization, I develop a game-theoretic model of economic growth with political economy constraints. In an economy where low income agents are […]
The Effects of Prevention and Treatment Interventions in a Microeconomic Model of HIV Transmission
By Allison Stashko A rational choice-based model for sexual transmission of HIV demonstrates the behavioral and epidemiological effects of public health interventions. Susceptible individuals choose to protect or expose, both responding to and determining HIV prevalence. Interventions are modeled as exogenous shocks to the cost of protection, treatment coverage, and treatment quality. A prevention intervention […]
Policy in Competitive Insurance Markets: Incentivizing Risk Sharing and Cost Efficiency
By Ross Green In the setting of a population with heterogeneous risk of illness, informational asymmetries in a competitive health insurance market can cause the gains from risk sharing to fall short of social optimality in equilibrium. Traditional policies meant to address the under-provision of insurance, like mandating open enrollment or community-rated premiums, can be […]
Game Theory and The World Marathon Majors
By Benjamin Jones The World Marathon Majors (WMM) Series Prize was enacted in 2006 as a million dollar prize handed out annually to the top man and woman competing at five of the most important marathons. This paper considers the motivations behind setting up this prize, as well as the theoretical rationale for its existence […]
Incentives in Professional Tennis: Tournament Theory and Intangible Factors
By Steven Seidel and Joshua Silverman This paper analyzes the incentives of professional tennis players in a tournament setting, as a proxy for workers in a firm. Previous studies have asserted that workers exert more effort when monetary incentives are increased, and that effort is maximized when marginal pay dispersion varies directly with position in […]
Mixed Strategy Equilibrium in Tennis Serves
by Joel Wiles Abstract A mixed strategy is a random choice among available strategies, with each strategy being chosen a set percentage of the time. In many games that require unpredictable play, game theory predicts that a mixed strategy equilibrium, a situation where each player uses an optimal mixed strategy, will result. Economists have tested […]
