Working Paper
Libgober J, Mu X. Informational Robustness in Intertemporal Pricing (JOB MARKET PAPER). Working Paper.Abstract

Consumers may be unsure of their willingness-to-pay for a product if they are unfamiliar with some of its features or have never made a similar purchase before. How does this possibility influence optimal pricing? To answer this question, we introduce a dynamic pricing model where buyers have the ability to learn about their value for a product over time. A seller commits to a pricing strategy, while buyers arrive exogenously and decide when to make a one-time purchase. The seller does not know how each buyer learns about his value for the product, and seeks to maximize profits against the worst-case information arrival processes. With only a single quality level and no known informational externalities, a constant price path delivers the optimal profit, which is also the optimal profit in an environment where buyers cannot delay. We then demonstrate that introductory pricing can be beneficial when the seller knows information is conveyed across buyers, and that intertemporal incentives arise when there are gradations in quality.

Libgober J. False Positives and Transparency in Scientific Research. Working Paper.Abstract

This paper develops a model of costly information acquisition, focusing on an application to scientific research. When research protocols are not fully transparent, scientists are incentivized to make their experiments more susceptible to false positives, even though they obtain higher surplus from more informative experiments. On the other hand, non-transparency can induce a scientist to undertake a costlier but more informative experiment if it also enables her to commit to acting scrupulously. Our analysis suggests, counterintuitively, that policies establishing greater transparency in scientific methodology might therefore ultimately lead to some scientists undertaking research that is worse for those interested in the results.

Libgober J. Prototyping under Competition. Working Paper.Abstract
Allocations of contracts for new technology development are often done prior to the total resolution of uncertainty regarding ultimate viability. A common method of allocation involves prototyping—demonstrating some preliminary version of the project with the intention of bringing it to completion. This considers the value of competition in these settings, relating the results to challenges faced by policymakers. When agents share the same ordinal preferences over their projects as the principal (for instance, if surplus is ultimately divided according to Nash bargaining between the principal and selected agent), an optimal mechanism need not feature stochastic project choice when randomizations across agents are feasible. Such mechanisms may be suboptimal without the alignment of the principal's and agent's incentives. The resulting policy requires commitment whenever randomization is involved, despite the optimality of deterministic mechanisms in the single agent case.