Hello and welcome to the 2nd edition of the MPhil Seminar Series: Novel Ideas (probably the best masters-level Seminar Series in the world!). Seminars will take place on Thursday afternoons from 3:15 to 4:30 pm starting on 27/10. Seminars for Weeks 7 and 8 will take place same time on Fridays. They will all be held in the Skills Lab at Manor Road Building . Presentations can also be followed online via Zoom . Below you can find a miscellaneous of all the materials provided by the speakers in Michaelmas 2022-2023.
You can visit the site for previous Editions here.
If you are interested in attending as a speaker, please consider submitting your paper or presentation idea to carlos.gonzalezperez@economics.ox.ac.uk . Submissions are currently open for Hillary Term of the Academic Year 2022-2023.
27/10 A Solution in Search of a Problem? - The Monetary Policy and Financial Stability Implications of Central Bank Digital Currencies by Chris Hyland
Broad Topic: Monetary Economics, Theoretical Macroeconomics. Specific Topic: Financial Stability and Banking.
Abstract
This paper develops a tractable general equilibrium model to study the monetary policy and financial stability implications of the introduction of a retail central bank digital currency (retail CBDC). I construct a model that contains a heterogenous banking sector exhibiting market power, endogenous default, incomplete markets, and credit and deposit markets. My model replicates multiple channels through which monetary policy operate: the deposits channel, the bank lending and the risk-taking channel. I show that the transmission of monetary policy is dampened and household welfare loss arises. The introduction of a a retail CBDC is shown to improve the transmission of monetary policy. Furthermore, a retail CBDC is shown to increase competition in the monopolistic banking sector, thereby leading to a crowding in of savings via bank deposits, expanding bank intermediation, and thereby increasing output. However, a tradeoff naturally arises in the form of an increase in financial instability.
03/11 Team Formation and Production: A Network Study of Publications in Economics by Yang Xu
Broad Topic: Networks. Specific Topic: Team Production.
Abstract
An increasing number of economists publish in teams. This paper attempts to examine what makes two economists collaborate and how much productivity gain comes with collaborations. I find that as the difference in the average publication quality, as measured by the journal quality index, gets smaller, two economists are more likely to collaborate. Moreover, similarity in log citation counts and being at the same institution both increase the chance of collaboration. There is also evidence of horizontal sorting (two authors of similar productivity) as well as vertical sorting (two authors of fairly different productivity). On average, a two-person team benefits from a 9% collaboration gain whereas a three-person team benefits from a 20% gain.
10/11 Adverse Selection in Adaptive Settings by Carlos Gonzalez
Broad Topic: Adaptive Treatment, Public Policy Design. Specific Topic: Bandit Algorithms, Information Economics.
Abstract
When the policymaker is unable to distinguish across agents’ ability, classic adverse selection mechanisms may emerge leading to market unraveling. Here, I consider the problem of repeatedly choosing policy parameters, like public sector wages, in an adverse selection context, where the policymaker does not know the DGP of agents' types. The policimaker has the mandate to maximize social welfare subject to monopolistic and competitive equilibria considerations. However, unlike traditional bandit problems, (i) feedback is asymmetric across agents' decisions, and (ii) the policymaker may not observe utility at the end of the period. This paper builds on previous literature on sequential public policy design, generalizing feedback as a function of agent's decisions. Moreover, for the first time, I introduce perfect competition considerations into the repeated game, maximizing consumer surplus. Non-zero measure of full-information feedback brings hope for sublinear regret, even for unknown sample size. Finally, the sequential characterization of the problem is very amenable to contextual characterization, (partially) escaping adverse selection when informative covariates are available.
17/11 Finding Common Ground: A Semi-Parametric Preference Heterogeneity Model by Hubert Wu
Broad Topic: Microeconomic Theory. Specific Topic: Estimation of Preference Heterogeneity.
Abstract
Heterogeneity in preferences is important in many domains. However, many existing approaches to studying this phenomenon empirically come with trade-offs for the researcher. For example, parametric approaches often cannot be falsified or distinguish between the predictions of other models. Additionally, while revealed preference methods may identify the existence of a set of types, further economic analysis can be difficult to perform due to the non-parametric nature of these approaches. To complement such methods, this paper introduces a semi-parametric approach to studying preference heterogeneity that is grounded in economic theory, generates falsifiable empirical predictions, and yields economic content beyond a yes/no identification of diverse preferences. I present several empirical applications to demonstrate the advantages of this approach.
25/11 Profit from Auto Insurance in Ontario Canada: Have People Overpaid? by Andrew Paulley
Broad Topic: Empirical Industrial Organization. Specific Topic: Price Regulations
Abstract
In the 1980s, provincial governments across Canada saw auto insurance premiums balloon and insurance company profits soar. In response, several provinces closed the private auto insurance market, opting to set up a public provincial monopoly that ran with a not-for-profit mandate. Other provinces, like Ontario, instead opted for a model of government oversight and regulation, where private companies were required to apply to a provincial regulator to raise or lower their premiums. We analyse approved applications for premium rate changes in Ontario from 1999 to 2022 to understand the implication of this oversight, and if profits in the Ontario auto insurance industry were indeed controlled.
02/12 Estimating the Price and Quality Relationship in U.S. Hospitals by Elodie Chervin
Broad Topic: Health Economics. Specific Topic: Price Regulation in Inelastic-demand Markets.
Abstract
We aim to overcome the selection issues when patients, in the United States, choose where to receive care to uncover the relationship between price and quality of care. We also briefly present a similar approach for estimating the relationship between for-profit hospital status and hospital admission decisions. For both of those, we use an instrumental variable approach which exploits that ambulance companies are quasi-randomly assigned to transport patients and have strong preferences for certain hospitals. We show a strong relationship between higher prices and lower mortality, which has important implications for healthcare price regulation. Being admitted to a hospital with two standard deviations higher prices raises spending by 52% and lowers mortality by 1 percentage point (35%). However, the relationship between higher prices and lower mortality is only present at hospitals in less concentrated markets. Receiving care from an expensive hospital in a concentrated market increases spending but has no detectable effect on mortality.