Tag Archives: microeconomics

Labor Market Dynamics, Persuasion

As the final exams coming, the time-budget has been more and more tight for me. I really want to go to the seminars, but there is not enough time for me to do that -- I always feel so tired....

Anyway, last Friday there was a workshop I cannot miss:

CREI-CEPR Workshop "Changes in Labor Market Dynamics"

Because Jordi Galí and Thijs van Rens, CREI and CEPR organized it.....And I'm really interested in labor market.

I listened to the first three speeches,

Demand Shocks Trigger Productivity Increases
Yan Bai, Arizona State University | W.P. Carey S. of Business, *José Víctor Ríos Rull, University of Minnesota, Kjetil Storesletten, Federal Reserve Bank of Minneapolis

The Vanishing Procyclicality of Labor Productivity
Jordi Galí, CREI, UPF & Barcelona GSE, Thijs van Rens, CREI & UPF

The Demise of Okun’s Law and of Procyclical Fluctuations in Conventional and Unconventional Measures of Productivity
Robert Gordon, Northwestern University

Eh..... Maybe due to the limit of time, they only introduced their works briefly. The problem for me is that I learned more labor related topics in a microeconomic view, not the macro one. Therefore, although the presentations were talking about labor, I still felt unfamiliar. Anyway, listening is a kind of learning and enjoying. Why not?
This afternoon was the regular microeconomics seminar, and it was

Bayesian Persuasion and Competition and Persuasion
[click here to download PDF]
Emir Kamenica (Chicago Booth School of Business)
CREI-CEPR Workshop "Changes in Labor Market Dynamics"

UPF Microeconomics Seminar

Again, I failed to catch up with all of his content. I was enjoying the first 1/3 part of his presentation, and then suddenly I realized that I cannot understand him any more. Haha... The interesting thing was not only me, but also most of the audience in the room kept silent. Nearly no questions, no discussions and no....no answer when the speaker asked something. Haha~ Anyway, perhaps the difference between economics and business are still big, so we don't really understand what's their aim. Or the models are quite different.... I cannot find any more possible explanations. Forgive me!

Ok, this post has successfully become a normal record of my day. I don't really want to lost my feeling for economics, but the problem sets....are still there. No choice.

investment for marriage

Every Monday means a new week, but my intensive classes always start from Tuesday. Therefore, the best choice for Monday may be to go and listen to the seminars. This afternoon I listened to this presentation:

Marriage as a rat-race: Pre-marital investments and assortative matching
V. Bhaskar (UCL)
UPF Microeconomics Seminar

Well, I should admit his title really attracted me. Although I have somehow realized that marriage has something to do with investment, but due to my poor scope of knowledge, I know nothing about how to build an economic model and explain the investment behaviors that people take for marriage. His model is not complicated, but very persuasive. By assuming the "match" process with probabilities and noises, he explained how the equilibrium exists and what are  (Pareto) efficient conditions. Here it seems meaningless to put some math equations, and what has drawn my interests is that he considered a special case: the unbalanced population in China/parts of India. I was always wondering how people outside of China analyze China's problems or phenomenon. Today I got a part of answer. At least from the public statistics about Chinese population structure, there are about 50% more men than women, so the boys only have a chance (equals the female/male ratio)  to find his wife (the question here is that because of the "one-child policy" in China, when the first baby of a couple is a girl, they may choose to not  report the birth to the government so that they can try the second chance to see whether they can get a boy. Thus, I don't really believe the public data). And apparently, it influences their investment behaviors and the final efficient equilibrium conditions.

I am wondering what would happen if we consider the dynamic change of marriage market (if it can be regarded as a market match process). What may be taken into account is that not boys/men in China are intending to get married later and later, while girls usually get married at their early age. For example, some of my friends (girls) have a boyfriend 5 or even more years older than them. That is to say, if a boy cannot match a girl when he is young (20-25), he is still possible to find a wife when he becomes older and have more wealth in hand which may attract young girls. Although in the long run it is not a question, I still want to know whether this kind of "match" will have effects on boys' investment behaviors or not.

Similarly, in the labor market, if people feel hard to find a job now, they may go back to school and pursue higher degrees. What will happen if all people do this?  (just like what university graduates do in China now: they spend more time on get an admission from graduate schools with the expectation that they may find a better job with a master degree. However, will individual rationality result in group non-rationality?)

I'm looking for the full text of this paper but unfortunately it is not available online since it seems really new. Hope the author will post this paper on his websites soon, then I'll update the link here.

[Update Oct, 8] I have received the full text from Prof. Bhaskar. If anyone who is also interested, please leave a message below this post with your email address. When he puts it on his website, I'll update the link if possible.

Our results are consistent
with a reasonably large causal e§ect of attending an elite law school, but the exact size of the
premium depends varies with assumptions about the role of unobservables.

Optimists and Pessimists

Today it seemed that I had nothing better to do so I picked up two guys and went to a seminar. It was about "Optimists and Pessimists", or more specifically, the title was Insurance and Perceptions: How to Screen Optimists and Pessimists, offered by Johannes Spinnewijn from London School of Economics as a series of UPF Microeconomics Seminar. Well, I should admit that he is really young (just graduated from MIT last year)...Although there is no decent published papers listed on his CV, according to today's speech, he is supposed to be a good researcher and teacher.

As the titled says, his paper is about how to distinguish two kinds of people in the insurance market: who are optimistic and who are pessimistic. He has got some interesting conclusions by separating the optimistic behaviors into two kinds: baseline-optimistic and control-optimistic. Then follows the discussions in competitive market and monopoly market respectively, there appears the different actions what the agent and principal take. I love one of his conclusion that "people with heterogeneous abilities or risks, but identical perceptions cannot be separated" while "people with different perceptions can be separated with a menu of screening contracts, even when the true abilities or risks are the same". That indicates (I hope I understand it correctly) the expectation plays a more important role than the true abilities when deciding people's behavior. Thus, whatever your true ability is, your attitude partly decides the situation you are facing/living in. At the end, he also considered the government's role and regulation/subsides, but that was not what I really cared about then.

At last, one interesting episode. Mas-colell suddenly appeared when the seminar was going. I was shocked because I've heared that Mas-colell didn't really take part in teaching or any thing else related to our program or GSE. But he appeared... It seemed that he was still caring about what the latest economic researches are doing. Great! (But anyway, during the discussion, he didn't say any words...)

(the temporary loss of my Chinese blog forces me to post in English... Is it good or bad? I have no idea... )

1 hour on the Platform

Last Monday I listened to Peng's (Peng Shige) Lecture about the measure of financial risks. Similar to previous lectures, there are numbers of official news reports. However, I'd like to share my personal feeling with you.

I have no better choice but to admit that Prof Peng is really an authority, not only because of his great contribution to the professional field of mathematics and finance, but also for his zeal of research and the wonderful explanation of his thought.  He has the ability to make the only an hour's lecture magic, to lead us fall in love with his "nonlinear expectation operator". It is a pity for me that after having stayed for numerous years in SDU, I know nothing about Peng's research. I think without long time precipitation of thought, it is impossible to have such deep realizations.

One word he mentioned that night really impressed me, it was: dirty work. Nowadays there are so many dirty works that make us apathetic.

Today I have said too much just because last Wed's afternoon I had an exercise class of intermediate microeconomics for one hour as a TA. I was confident about my knowledge of micro economic theory, since I could understand the book called "microeconomic theory " by Mas-Cololl,Winston,Green as least. But when illustrate these with my words and make them clear to the audience, I learned the hardness of the process. I spent more than 5 hours in front of my computer on making the handout. Since pictures were helpful, I installed Illustrator and Flash to make the visual effects better. I was willing to use these as supplements to help them understand the economic thoughts behind the mathematical formulas. Although time is needed to examine whether I have succeed, I'll work on. Personally speaking, intermediate microeconomics is too important for the whole development of the economic study.  At least, I have already achieved my initial goal, which is also the reason I used to persuade my advisor to leave me this chance: to examine my knowledge of intermediate microeconomics.

The next class will be two weeks after, and I have to work hard to prepare. I just hope that my advisor won't be disappointed about his decision and trust, and also for those who take time to attend the class it is worthy that time. At last, I have no excuse to fail. It is really worthy that much.
In the end, and also on the one-year's memorial day, I want to speak out these words: I'll do whatever in return to your guidance.

Thank you so much, dear Yue, my advisor.

[NEW] You can download all presentations here: http://www.cloudlychen.net/papers.html#impre