Northwestern University 
BRUNO STRULOVICI
DEPARTMENT OF ECONOMICS

 


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HOW TO CONTACT ME

Department of Economics
Northwestern University
2001 Sheridan Road
Evanston, Illinois 60208, USA

Office number: 3221

Telephone: 847-491-8233
Facsimile: 847-491-7001
e-mail: b-strulovici@northwestern.edu

 



CURRICULUM VITAE


 

TEACHING

Economics 335 (Political Economics) Syllabus

Economics 412 (Dynamic Methods for Economics) Syllabus


 

RECENT PAPERS

 

On the Design of Criminal Trials: the Benefit of Three-Verdict Systems with Ron Siegel

·         Adding a third verdict increases welfare without increasing the risk of punishing the innocent, and may be implemented simply

·         Plea bargaining with two verdicts has more informational value than any multi-verdict system, and is in fact the optimal mechanism

·         Adding a third verdict can increase incentives to acquire information

 

Beyond Correlation: Measuring Interdependence through Complementarities with Margaret Meyer

·         Correlation is not an economically-grounded measure of interdependence of random variables, just as variance fails to capture risk except in quadratic or Gaussian cases

·         Interdependence often matters to economists because of complementarities (i.e., supermodularity) in the objective functions they analyze

·         We study this supermodular ordering of interdependence, providing characterizations and concrete methods for comparing distributions, including those distributions generated by common and idiosyncratic shocks

 

From Anticipations to Present Bias: A Theory of Forward-Looking Preferences with Simone Galperti

·         Anticipations affect our current well-being and, except for knife-edge cases, lead to time inconsistency

·         We axiomatize anticipations-based preferences over infinite consumption streams, showing that for such preferences to be well-defined anticipations must lead to present bias

·         This delivers a tractable class of preferences which includes the beta-delta discounting model as particular case, but also models in which the discount factor between two periods depends on consumption at other periods

·         This class also captures “sign effects” in discounting, a desire to space out consumption and a preference for increasing consumption streams

 

Collective Commitment with Christian Roessler and Sandro Shelegia, R&R, Journal of Political Economy

·         Dynamic political equilibria are often inefficient. Can agents collectively commit at the outset to a better policy?

·         We provide a negative answer: the equilibrium policy is dominated by another long-term policy if and only if there exists a preference cycle among long-term policies which includes both the equilibrium and the dominating policy

·         This impossibility theorem holds for the majority rule as well as for all collective decision rules satisfying a power consistency condition, linking the power structure in the dynamic collective decisions with the power structure used to compare long-term policies at the commitment stage.

·         Power consistency is necessary and sufficient for the impossibility theorem to hold. It holds for all supermajority rules, but is violated in settings which involve time-inconsistent agents

 

Explicit Renegotiation in Repeated Games with Mikhail Safronov

·         Cooperation in repeated games relies on the threat of a punishment phase. Is cooperation still feasible when this punishment can be renegotiated?

·         We introduce an explicit protocol of renegotiation. Players may propose new plans, which specify future actions, future proposals, and players’ reactions to these proposals. A player who rejects a proposal may be rewarded for “enforcing the social norm”

·         The set of renegotiation-proof equilibria has a simple graphical characterization

 

Contract Negotiation and the Coase Conjecture

·         Actual negotiations contain a puzzle: parties try to withhold private information until striking a deal, but the timing and nature of the agreement can reveal some of this private information and, hence, reveal further gains from negotiations

·         This paper provides a dynamic resolution of the puzzle, which delivers a strategic foundation for renegotiation-proof contracts and extends the analysis of the Coase conjecture (but not the conjecture itself) to richer contractual environments

·         All equilibria converge to the same contracts as negotiation frictions vanish, which are straightforward to characterize graphically

 

Social Experimentation with Interdependent and Expanding Technologies with Umberto Garfagnini, R&R, Review of Economic Studies

·         Experimentation with correlated bandits is well-known to be intractable, and yet it captures many real-life technological environments

·         We analyze experimentation by overlapping generations. Payoffs are determined by the path of a Brownian motion and, hence, correlated

·         “Radical” experimentation means going beyond the farthest known technology and incurs a specific “expansion” cost. It is eventually abandoned with probability 1 for all parameters of our model, leading to stagnation and convergence to a single technological standard

 

The Hidden Cost of Direct Democracy: How Ballot Initiatives Affect Politicians’ Selection and Incentives with Carlo Prato

·         Direct democracy is often compared to representative democracy. But in modern regimes, these two types of democracies coexist. How do citizen initiatives and referendums affect regimes which are otherwise governed by elected representatives?

·         We identify several equilibrium effects, showing that direct democracy institutions can reduce the quality of selection and incentives of elected officials, sometimes reducing welfare even when these institutions do not entail any administrative or other exogenous cost

 

 

RESEARCH (BY TOPIC)

 

For a list that includes research abstracts, click here

 

COMPARATIVE STATICS

 

Beyond Correlation: Measuring Interdependence through Complementarities with Margaret Meyer (New/Updated)

 

Discounting, Values, and Decisions  with John Quah, Journal of Political Economy, October 2013

 

Aggregating the Single Crossing Property with John Quah, Econometrica, September 2012.

Increasing Interdependence of Multivariate Distributions with Meg Meyer, Journal of Economic Theory, Symposium on Inequality and Risk, July 2012.

Generalized Monotonicity Analysis with Thomas Weber, Economic Theory, June 2010

Comparative Statics, Informativeness, and the Interval Dominance Order with John Quah, Econometrica, November 2009.

 

 

DECISION THEORY

 

From Anticipations to Present Bias: A Theory of Forward-Looking Preferences with Simone Galperti (New/Updated)

 

DYNAMIC METHODS

 

On the Smoothness of Value Functions and the Existence of Optimal Strategies with Martin Szydlowski, forthcoming in the Journal of Economic Theory, Symposium on Dynamic Contracts and Mechanism Design (New/Updated)

 

FINANCE

 

Capital Mobility and Asset Pricing with Darrell Duffie, Econometrica, November 2012.

             

      Supplement to "Capital Mobility and Asset Pricing"

 

Performance Sensitive Debt with Gustavo Manso and Alexei Tchistyi, Review of Financial Studies (winner of the Society for Financial Studies’ Young Researcher Award, 2009), May 2010.

LAW AND ECONOMICS

 

On the Design of Criminal Trials: the Benefit of Three-Verdict Systems with Ron Siegel (New/Updated)

 

 

POLITICAL ECONOMY

 

Collective Commitment with Christian Roessler and Sandro Shelegia, Revise and Resubmit, Journal of Political Economy (New/Updated)

 

The Hidden Cost of Direct Democracy: How Ballot Initiatives Affect Politicians’ Selection and Incentives with Carlo Prato (New/Updated)

 

Learning While Voting: Determinants of Collective Experimentation Econometrica, May 2010.

     Extension: Voting and Experimentation with Correlated Types

     Working paper version (Oxford, 2007): Voting and Experimentation

     This version includes the “Singaporean Restaurant” example

 

RENEGOTIATION AND BARGAINING

 

Explicit Renegotiation in Repeated Games with Mikhail Safronov (New/Updated)

 

Contract Negotiation and the Coase Conjecture (New/Updated)

 

Contracts, Information Persistence, and Renegotiation, November 2011

 

SOCIAL LEARNING AND EXPERIMENTATION

 

Social Experimentation with Interdependent and Expanding Technologies with Umberto Garfagnini, Revise & Resubmit, Review of Economic Studies (New/Updated)

 

Learning While Voting: Determinants of Collective Experimentation Econometrica, May 2010.
(cross-listed with Political Economy)

 

 

AUCTIONS AND CONSUMER THEORY

Substitute Goods, Auctions, and Equilibrium with Paul Milgrom, Journal of Economic Theory, January 2009.

PUBLICATIONS IN OPERATIONS RESEARCH

 

Additive Envelopes of Continuous Functions with Thomas Weber, Operations Research Letters, May 2010.

Monotone Comparative Statics: A Geometric Approach with Thomas Weber, Journal of Optimization Theory and Applications, June 2008.

 


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