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Leisure of the Theory Class

The Leisure of the Theory Class is written by a group of Economics Professors, who blog on a range of topics from politics to microeconomics. Game Theory forms a large portion of the posts, making this a blog better suited for individuals with a strong economics background.

Paying for the right to be infected

Paying for the right to be infected August 14, 2020 in covid-19, economics, infection, Mechanism design Serious infectious diseases are a prime example of a public bad (non-exclusive and non-congestible). We limit them by restricting behavior and or getting individuals to internalize the externalities they generate. For example, one could mandate masks in public places. To be effective this requires monitoring and punishment. Unpleasant, but we know how to do this.  Or, one...

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The Lockdown Debate

The Lockdown Debate July 16, 2020 in covid-19, economics, Mechanism design | Tags: lockdown The efficacy of lockdowns was debated at the start of the pandemic and continues to this day. Sweden, famously, chose not to implement a lockdown. As Anders Tegnell, remarked:`Closedown, lockdown, closing borders — nothing has a historical scientific basis, in my view.’ Lyman Stone of the American Enterprise Institute expresses it more forcefully: `Here’s the thing: there’s no evidence...

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William Sandholm

William Sandholm July 9, 2020 in economics, Uncategorized One of the delights of pursuing a relatively young discipline is that one meets its pioneers. As one grows old in the discipline, so do the pioneers, who eventually pass into `the undiscovered country from whose bourn no traveler returns.’ Overlooked, at least by me, was that one also meets, in the chrysalis stage, those who will eventually lead the discipline into the next century. It was the untimely passing of William...

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Testing Alone is Insufficient

Testing Alone is Insufficient May 6, 2020 in covid-19, economics, Mechanism design | Tags: covid19, mechanism design, pandemic Will widely available and effective tests for COVID-19 awaken the economy from its COVID induced coma? Paul Romer, for one, thinks so. But what will each person do with the information gleaned from the test? Should we expect someone who has tested positive for the virus to stay home and someone who has tested negative to go to work? If the first...

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Universities After the Pandemic

Universities After the Pandemic May 4, 2020 in education, covid-19, infection On the 3rd of July, 1638, George Garrard  wrote Viscount Wentworth to tell him: The Plague is in Cambridge; no Commencement at either of the Universities this year. On October 2nd of that same year, Cambridge canceled all lectures. Even if history does not repeat (but historians do), one is tempted to look to the past for hints about the future. From the Annals of Cambridge  (compiled by Charles Henry...

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Hiring Freezes & Endowment Hoarding

Hiring Freezes & Endowment Hoarding April 11, 2020 in economics, education, hiring freezes | Tags: economics, endowment hoarding, hiring freeze Some days ago I learnt that a job offer to a promising postdoc I advise evaporated. Not unexpected in these times, but disappointing neverthelessThere are now about 300 Universities with hiring pauses or freezes in place. For Universities that are tuition driven, this is understandable. For those with large endowments of which a...

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Effects of a Partially Effective Vaccine

Effects of a Partially Effective Vaccine April 10, 2020 in covid-19, economics, infection, networks, vaccine | Tags: covid-19, networks The race to publish COVID-19 related papers is on, and I am already behind. Instead, I will repurpose a paper by Eduard Talamas and myself on networks and infections which is due out in GEB. It is prompted by the following question: if you are given the option to distribute—without cost to you or anyone else—a perfectly safe but only moderately...

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Econometrica Submission Fees

Econometrica Submission Fees March 31, 2020 in academic satire, economics, Pricing strategies This morning, a missive from the Econometrics society arrived in my in box announcing “two modest fees associated with the submission and publication of papers in its three journals.” As of May 1st 2020, the Society will assess a submission fee of $50 and a page charge of $10 per page for accepted papers. With papers on the short side running to around 30 pages and 10 page appendices...

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How Bibi changed the disagreement point

How Bibi changed the disagreement point March 28, 2020 in Uncategorized Time for some game theory about the recent development in Israeli politics. (You can read more about it here) In the aftermath of the last election, no side could form a governing coalition. So the options were either a unity government, composed of the two major parties (Bibi Netanyahu’s Likud and Benny Gantz’ Kahol-Lavan) or yet another, fourth in a row, election. But with a year of election campaigns...

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Pass/Fail and Unraveling

Pass/Fail and Unraveling March 23, 2020 in Bayesian Games, education With the move to on-line classes after spring break in the wake of Covid-19, my University has allowed students to opt to take some, all or none of their courses as pass/fail this semester. By making it optional, students have the opportunity to engage in signaling. A student doing well entering into spring break may elect to take the course for a regular grade confident they will gain a high grade. A student...

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