Auctions Versus Negotiations in Procurement: An Empirical Analysis (2009)
Bajari, Patrick, McMillan, Robert, Tadelis, Steven
Should the buyer of a customized good use competitive bidding or negotiation to select a contractor? To shed light on this question, we consider several possible determinants that may influence the...
Theory-driven choice models KANNAN SRINIVASAN GSTA, Carnegie-Mellon University (2008)
Wilfred Amaldoss, Patrick Bajari, Wes Hutchinson, Michael Katz, Michael Keane, Robert Meyer, ...
We explore issues in theory-driven choice modeling by focusing on partial-equilibrium models of dynamic structural demand with forward-looking decision-makers, full equilibrium models that integrate...
Patrick Bajari, Jonathan Levin, C. Lanier Benkard
We describe a two-step algorithm for estimating dynamic games under the assumption that behavior is consistent with Markov perfect equilibrium. In the first step, the policy functions and the law of...
Acknowledgments: Many thanks to Rabah Amir, Kate Antonovics, Andrés Aradillas-López, (2008)
Federico Echenique, Ivana Komunjer, Patrick Bajari, Peter Bossaerts, Colin Camerer, Chris Chambers, ...
Abstract. This paper proposes a method for testing complementarities between explanatory and dependent variables in a large class of economic models. The proposed test is based on the monotone...
Patrick Bajari, Jeremy T. Fox, Kyoo Il Kim, Stephen Ryan
We propose an estimator for discrete choice models, such as the logit, with a nonparametric distribution of random coe ¢ cients. The estimator is linear regression subject to linear inequality...
Patrick Bajari, C. Lanier Benkard
We derive some theoretical economic properties of standard discrete choice econometric models that we believe are undesirable if the models are to be used as structural models of demand. We show that...
Patrick Bajari Lanier, Patrick Bajari, C. Lanier Benkard
We derive several properties of commonly used discrete choice models that are potentially undesirable if these models are to be used as structural models of demand.
Estimating dynamic models of imperfect competition. Working Paper (2006)
Patrick Bajari, C. Lanier Benkard, Jonathan Levin
We describe a two-step algorithm for estimating dynamic games under the assumption that behavior is consistent with Markov perfect equilibrium. In the first step, the policy functions and the law of...
Estimating Static Models of Strategic Interactions’, Working Paper (2005)
Patrick Bajari, Han Hong, John Krainer, Denis Nekipelov
We propose a method for estimating static games of incomplete information. A static game is a generalization of a discrete choice model, such as a multinomial logit or probit, which allows the...
House Prices and Consumer Welfare* (2005)
Patrick Bajari, C. Lanier Benkard, John Krainer
Abstract: We develop a new approach to measuring changes in consumer welfare due to changes in the price of owner-occupied housing. In our approach, an agent’s welfare adjustment is defined as the...
Patrick Bajari, C. Lanier Benkard, Ian Crawford, Hidehiko Ichimura, Guido Imbens, John Krainer, ...
We reconsider the identification and estimation of Gorman-Lancaster style hedonic models of demand for differentiated products in the spirit of Rosen (1974). We generalize Rosen’s first stage to...
House prices and consumer welfare (2005)
Patrick Bajari, C. Lanier Benkard, John Krainer
We develop a new approach to measuring changes in consumer welfare due to changes in the price of owner-occupied housing. In our approach, an agent’s welfare adjustment is defined as the transfer...
Patrick Bajari, C. Lanier Benkard, Steven Berry, Timothy Bresnahan, Ian Crawford, Hidehiko Ichimura, ...
We reconsider the identification and estimation of Gorman-Lancasterstyle hedonic models of demand for differentiated products in the spirit of Sherwin Rosen. We generalize Rosen’s first stage to...
Patrick Bajari, C. Lanier Benkard
We derive several properties of commonly used discrete choice models that are potentially undesirable if these models are to be used as structural models of demand. Specifically, we show that as the...
Detecting collusion in procurement auctions (2002)
Patrick Bajari, Garrett Summers
early stage with this research. Paul Milgrom, Steve Tadelis and Steve Brenner also provided very useful comments on various parts of this work. Pueo Keffer provided outstanding research assistance....
Patrick Bajari, C. Lanier Benkard
We study the identification and estimation of preferences in hedonic discrete choice models of demand for differentiated products. In the hedonic discrete choice model, products are represented as a...
Tülin Erdem, Kannan Srinivasan, Wilfred Amaldoss, Patrick Bajari, Hai Che, Teck Ho, ...
We explore issues in theory-driven choice modeling by focusing on partial-equilibrium models of dynamic structural demand with forward-looking decision-makers, full equilibrium models that integrate...
Identification and Estimation of Discrete Games of Complete Information
Stephen Ryan, Patrick Bajari, Han Hong
We discuss the identification and estimation of discrete games with complete information. Following Bresnahan and Reiss, a discrete game is defined to be a generalization of a standard discrete...
C. Lanier Benkard, Patrick Bajari
We study the identification and estimation of Gorman-Lancaster style hedonic models of demand for differentiated products for the case when one product characteristic is not observed. Our...
Estimating Static Models of Strategic Interaction
Patrick Bajari, Han Hong, John Krainer, Denis Nekipelov
We propose a method for estimating static games of incomplete information. A static game is a generalization of a discrete choice model, such as a multinomial logit or probit, which allows the...
Semiparametric Estimation of a Dynamic Game of Incomplete Information
Recently, empirical industrial organization economists have proposed estimators for dynamic games of incomplete information. In these models, agents choose from a finite number actions and maximize...
Identification and Estimation of Discrete Games of Complete Information
Patrick Bajari, Han Hong, Stephen Ryan
We discuss the identification and estimation of discrete games of complete information. Following Bresnahan and Reiss (1990, 1991), a discrete game is a generalization of a standard discrete choice...
Complementarities and Collusion in an FCC Spectrum Auction
We empirically study bidding in the C Block of the US mobile phone spectrum auctions. Spectrum auctions are conducted using a simultaneous ascending auction design that allows bidders to assemble...
Bidding for Incomplete Contracts: An Empirical Analysis
Patrick Bajari, Stephanie Houghton, Steve Tadelis
Procurement contracts are often incomplete because the initial plans and specifications are changed and refined after the contract is awarded to the lowest bidder. This results in a final cost to the...
Evaluating Wireless Carrier Consolidation Using Semiparametric Demand Estimation
Patrick Bajari, Jeremy T. Fox, Stephen Ryan
The US mobile phone service industry has dramatically consolidated over the last two decades. One justification for consolidation is that merged firms can provide consumers with larger coverage areas...
Moral Hazard, Adverse Selection and Health Expenditures: A Semiparametric Analysis
Patrick Bajari, Han Hong, Ahmed Khwaja
Theoretical models predict asymmetric information in health insurance markets may generate inefficient outcomes due to adverse selection and moral hazard. However, previous empirical research has...
Hedonic Price Indexes With Unobserved Product Characteristics, and Application to Personal Computers
Patrick Bajari, C. Lanier Benkard
We reconsider the identification and estimation of Gorman-Lancaster-style hedonic models of demand for differentiated products in the spirit of Sherwin Rosen. We generalize Rosen's first stage to...
Economic Insights from Internet Auctions
This paper surveys recent studies of internet auctions. Four main areas of research are summarized. First, we survey several studies that document and attempt to explain the frequently observed...
Estimating Dynamic Models of Imperfect Competition
Patrick Bajari, C. Lanier Benkard, Jonathan Levin
We describe a two-step algorithm for estimating dynamic games under the assumption that behavior is consistent with Markov perfect equilibrium. In the first step, the policy functions and the law of...
Winner's Curse, Reserve Prices and Endogenous Entry: Empirical Insights from eBay Auctions
No abstract.
Bidding for Incompete Contracts
Patrick Bajari, Stephanie Houghton, Steven Tadelis
When procurement contracts are incomplete, they are frequently changed after the contract is awarded to the lowest bidder. This results in a final cost that differs from the initial price, and may...
The Winner's Curse, Reserve Prices, and Endogenous Entry: Empirical Insights from eBay Auctions.
Bajari, Patrick, Hortacsu, Ali
Internet auctions have recently gained widespread popularity and are one of the most successful forms of electronic commerce. We examine a unique dataset of eBay coin auctions to explore the...
Incentives versus Transaction Costs: A Theory of Procurement Contracts.
Bajari, Patrick, Tadelis, Steven
Inspired by facts from the private-sector construction industry, we develop a model that explains many stylized facts of procurement contracts. The buyer in our model incurs a cost of providing a...
Point Estimation of Discrete Games
We propose a method for point estimation of discrete games similar to those considered by Bresnahan and Reiss (1991). In the model, the vNM utilities are a function of observed co-variates and random...
Deciding Between Competition and Collusion
We develop an approach to identify and test for bid rigging in procurement auctions. First, we introduce a general auction model with asymmetric bidders. Second, we study the problem of...
symposium articles : Comparing competition and collusion: a numerical approach
Collusion is a serious problem in many procurement auctions. In this research, I study a model of first price sealed bid procurement auctions with asymmetric bidders. I demonstrate that the...
Benkard, C. Lanier, Bajari, Patrick
We study the identification and estimation of preferences in hedonic discrete choice models of demand for differentiated products. In the hedonic discrete choice model, products are represented as a...
Benkard, C. Lanier, Bajari, Patrick
We derive some theoretical economic properties of standard discrete choice econo-metric models that we believe are undesirable if the models are to be used as structural models of demand. We show...
Hedonic Price Indexes with Unobserved Product Characteristics, and Application to PC's
Benkard, C. Lanier, Bajari, Patrick
We show that hedonic price indexes may be biased when not all product characteristics are observed. We derive two primary sources of bias. The first is a classical selection problem that arises due...
Bajari, Patrick, Benkard, C. Lanier
We study the identification and estimation of Gorman-Lancaster style hedonic models of demand for differentiated products for the case when one product characteristic is not observed. Our...
House Prices and Consumer Welfare
Bajari, Patrick, Benkard, C. Lanier, Krainer, John
We develop a new approach to measuring changes in consumer welfare due to changes in the price of owner-occupied housing. In our approach, an agent’s welfare adjustment is defined as the transfer...
Estimating Dynamic Models of Imperfect Competition
Bajari, Patrick, Benkard, C. Lanier, Levin, Jonathan
We describe a two-step algorithm for estimating dynamic games under the assumption that behavior is consistent with Markov perfect equilibrium. In the first step, the policy functions and the law of...
Evaluating wireless carrier consolidation using semiparametric demand estimation
Patrick Bajari, Jeremy Fox, Stephen Ryan
Market share ranks, Semiparametric, Demand estimation, Amazon, Mergers, Antitrust, Telecommunications, Mobile phones, Online, Discrete choice, L4, L63, C35, C13, C14,
Should Governments Auction Nationwide Spectrum Licenses? Estimating Bidder Valuations
We empirically study bidding in the C Block of the US mobile phone spectrum auctions. Spectrum auctions are conducted using a simultaneous ascending auction design that allows bidders to assemble...
Auctions Versus Negotiations in Procurement: An Empirical Analysis
Patrick Bajari, Robert S. McMillan, Steve Tadelis
Should the buyer of a customized good use competitive bidding or negotiation to select a contractor? To shed light on this question, we offer a framework that compares auctions with negotiations. We...
House Prices and Consumer Welfare
Patrick Bajari, C. Lanier Benkard, John Krainer
We develop a new approach to measuring changes in consumer welfare due to changes in the price of owner-occupied housing. In our approach, an agent's welfare adjustment is defined as the transfer...
Are Structural Estimates of Auction Models Reasonable? Evidence from Experimental Data
Recently, economists have developed methods for structural estimation of auction models. Many researchers object to these methods because they find the rationality assumptions used in these models to...
Estimating Housing Demand with an Application to Explaining Racial Segregation in Cities
Patrick Bajari, Matthew E. Kahn
We present a three-stage estimation procedure to recover willingness to pay for housing attributes. In the first stage, we estimate a non-parametric hedonic home price function. Second, we recover...
Hedonic Price Indexes with Unobserved Product Characteristics, and Application to PC's
C. Lanier Benkard, Patrick Bajari
We show that hedonic price indexes may be biased when not all product characteristics are observed. We derive two primary sources of bias. The first is a classical selection problem that arises due...
Economic Insights from Internet Auctions: A Survey
This paper surveys recent studies of Internet auctions. Four main areas of research are summarized. First, economists have documented strategic bidding in these markets and attempted to understand...
Estimating Dynamic Models of Imperfect Competition
Patrick Bajari, C. Lanier Benkard, Jonathan Levin
We describe a two-step algorithm for estimating dynamic games under the assumption that behavior is consistent with Markov Perfect Equilibrium. In the first step, the policy functions and the law of...
In this paper we develop an empirical model of equity analyst recommendations for firms in the NASDAQ 100 during 1998-2003. In the model we allow recommendations to depend on publicly observed...
Patrick Bajari, C. Lanier Benkard
We study the identification and estimation of preferences in hedonic discrete choice models of demand for differentiated products. In the hedonic discrete choice model, products are represented as a...
Auction Models Are Not Robust When Bidders Make Small Mistakes
September 1999 Economists are generally suspicious of equilibria that are not robust to small perturbations since Agents in real world problems may not be able to perfectly optimize. This research...
Comparing Competition and Collusion in Procurement Auctions: A Numerical Approach
January 2000, Revised January 2001 Collusion is a serious problem in many procurement auctions. In this research, I study a model of first price sealed bid procurement auctions with asymmetric...
Why Do Blacks Live in The Cities and Whites Live in the Suburbs?
Patrick Bajari, Matthew E. Kahn
Revised March 2001 This paper estimates a discrete choice model of housing product demand to study the causes of black urbanization. Our estimation strategy incorporates that there are unobserved...
Competition Versus Collusion in Procurement Auctions: Identification and Testing
February 2001 In this research, we develop an approach to the problem of identification and testing for bid-rigging in procurement auctions that tightly integrates economic theory and econometric...
Deciding Between Competition and Collusion
May 2001 In many studies in empirical industrial organization, the economist needs to decide between several non-nested models of industry equilibrium. In this paper, we develop a new approach to...
Patrick Bajari, C. Lanier Benkard
June 2001 We study the identification and estimation of preferences in hedonic discrete choice models of demand for differentiated products. In the hedonic discrete choice model, products are...
Auction Models When Bidders Make Small Mistakes: Consequences for Theory and Estimation
August 2001 In this paper, we explore the consequences of using equilibrium models of auctions in making policy recommendations, such as the design of real world markets, or as a basis for...
Detecting Collusion in Procurement Auctions: A Selective Survey of Recent Research
Patrick Bajari, Garrett Summers
Revised April 2002 Economic theory suggests that if firms can successfully collude, they will be able to increase their own profits at the consumers’ expense. Government antitrust policy aims to...
Patrick Bajari, Lanier Benkard
October 2001 We derive some theoretical economic properties of standard discrete choice econometric models that we believe are undesirable if the models are to be used as structural models of...
Cyberspace Auctions and Pricing Issues: A Review of Empirical Findings
April 2002 This article surveys empirical findings from recent studies of Internet auctions and summarizes the economic insights gained from these findings. The main questions addressed in this...
Auctions versus Negotiations in Procurement: An Empirical Analysis
Patrick Bajari, Robert McMillan, Steven Tadelis
Revised October 2002 When should a buyer award a procurement contract through competitive bidding, and when would negotiating with the sellers be preferred? To shed some light on this question, we...
Estimating Housing Demand with an Application to Explaining Racial Segregation in Cities
Patrick Bajari, Matthew E. Kahn
August 2002 We present a three-stage estimation procedure to recover willingness to pay for housing attributes. In the first stage, we estimate a non-parametric hedonic home price function. Second,...
Are Structural Estimates of Auction Models Reasonable? Evidence from Experimental Data
February 2003 Recently, economists have developed methods for structural estimation of auction models. Many researchers object to these methods because they find the rationality assumptions used in...
Incentives versus Transaction Costs: A Theory of Procurement Contracts
Patrick Bajari, Steven Tadelis
November 2, 1999 Inspired by facts from the private sector construction industry, we develop a model that explains many of the stylized facts about procurement contracts. The buyer in our model...
Auction Design and Tacit Collusion in FCC Spectrum Auctions
The Federal Communications Commission (FCC) has used auctions to award spectrum since 1994. During this time period, the FCC has experimented with a variety of auctions rules including click box...
An Empirical Model of Subprime Mortgage Default from 2000 to 2007
Patrick Bajari, Sean Chu, Minjung Park
The turmoil that started with increased defaults in the subprime mortgage market has generated instability in the financial system around the world. To better understand the root causes of this...
The Random Coefficients Logit Model Is Identified
Patrick Bajari, Jeremy Fox, Kyoo Il Kim, Stephen P. Ryan
The random coefficients, multinomial choice logit model has been widely used in empirical choice analysis for the last 30 years. We are the first to prove that the distribution of random coefficients...
Procurement Contracting with Time Incentives: Theory and Evidence
In public sector procurement, social welfare often depends on the time taken to complete the contract. A leading example is highway construction, where slow completion times inflict a negative...
A Simple Nonparametric Estimator for the Distribution of Random Coefficients
Patrick Bajari, Jeremy T. Fox, Kyoo Il Kim, Stephen P. Ryan
We propose a simple nonparametric mixtures estimator for recovering the joint distribution of parameter heterogeneity in economic models, such as the random coefficients logit. The estimator is based...
Auction design and tacit collusion in FCC spectrum auctions
The Federal Communications Commission (FCC) has used auctions to award spectrum since 1994. During this time period, the FCC has experimented with a variety of auctions rules including click box...
Patrick Bajari, Jeremy T. Fox, Kyoo Il Kim, Stephen Ryan
We propose an estimator for discrete choice models, such as the logit, with a nonparametric distribution of random coefficients. The estimator is linear regression subject to linear inequality...