Three Essays On The Acquisition Of Information

This thesis consists of three essays related to the problem of acquisition of information by economic agents.;The first essay, entitled "Bundled Insurance", considers the problem of screening good-and bad-risk individuals in an insurance market. Insurance markets under adverse selection are known to generate incomplete risk sharing. This essay shows that it is optimal, in the context of reactive equilibria, for a monopolist in some unrelated market to bundle its product with a compulsory insurance policy. This essay may help us to understand why employers often provide compulsory group insurance.;The purpose of the second essay, entitled "Search and Price Advertising", is to study the role and implications of price advertising when the acquisition of price information is costly to consumers. Advertising is introduced into a random sequential search model. The model generates interesting predictions about the equilibrium shape of the price distribution on the advertising behavior of the firms and the interactions between informative advertising and competition.;In auctions, the seller's problem derives from the fact that he has imperfect information about the buyer's willingness to pay for the object on sale. However, when the bidders' private valuations are not statistically independent, the auctioneer would be able to extract all the surplus (Cremer and McLean (1988)). The intent of the third essay, entitled "Continuity in Auction Design", is to see how limited liability and/or risk aversion affect the above result. Invoking the Maximum Theorem (Berge, 1963), we show that the optimal expected gain attainable by the auctioneer becomes continuous and the set of optimal auctions is upper hemi-continuous in the set of the possible auctions.

Name thesis:degree_name

Ph D

Year dc:date.issued

1989

Author dc:creator

• Robert, Jacques

• Economics
• Theory

Handle dc:identifier.uri

https://hdl.handle.net/20.500.14721/21443

OAI identifier oai:identifier

oai:uwo.scholaris.ca:20.500.14721/21443