Working Papers

The Optimal Level of Consultation (Job Market Paper) [full draft]

• Abstract: We study how an information provider optimally manages information precision to maximize revenue from a consumer who pays to learn before taking an irreversible action.  The principal chooses the precision of a drift-diffusion signal process, and the agent decides when to stop learning and take an action. We find that the principal optimally provides the least informative signals to the most uncertain agent because the principal can exploit the agent's high willingness to pay for information to prolong engagement and extract rents. This generates a U-shaped relationship between optimal precision and the agent’s prior belief. When the agent's prior is his private information, standard screening breaks down, and any menu of contracts collapses to a single pooling contract, limiting the principal's ability to differentiate across types and excluding agents with sufficiently extreme priors. Applications include digital search platforms and advisory markets.

Work in Progress

Experimentation with Asymmetric Observation

Course Instructor 

• ECON 101: Microeconomic Theory - 2024 Summer (Rating: 8.25/9.00)