Stephan Lauermann

Professor of Economics
University of Bonn
10/8/18 10/12/18

My research is concerned with the theoretical analysis of the strategic interaction of individuals in existing institutions. In particular, I study the ability of institutions to aggregate information that is dispersed among many agents, with “markets” and “elections” as the main examples. For instance, regarding markets, I continue working on a setting in which a seller is searching for buyers to bid in an auction when there is value uncertainty. An example would be a seller of a company who searches for investors who have only partial information about the company’s profitability. I also work on elections in which an interested party can affect elections either by manipulating the number of voters or their information. For example, I consider an interested party that contacts voters sequentially in the hope of finding a veto and I study how an interested party can affect voting outcomes through strategic information release. 

In future work on markets, I plan to continue working on search with learning in decentralized markets. A concrete example of a decentralized market would be an online auction market (eBay) but the theory also applies to the market for housing, labor, and over-the-counter asset markets. Specifically, in contrast to my prior work, I want to consider an environment with large frictions and study how uncertainty about aggregate uncertainty affects market outcomes. For example, in labor markets, I plan to study how uncertainty about market conditions affects wage dispersion and unemployment duration through its impact on bargaining and search. A natural policy question would be to study how the release of public information can enhance efficiency, such as the publication of benchmarks and post-trade transaction terms in over-the-counter asset markets. I plan to test these theories about search and learning using available data from online auction markets, ideally also testing the impact of interventions. Regarding elections, I want to study elections in the context of corporate control (shareholder voting). Here, the management is naturally modelled as having biased preferences relative to shareholders while affecting important parameters of election. Outcomes of shareholder votes are often non-binding, which makes such elections similar to protests and polling.