February 19: Noemie Cabau (QSMS Seminar)

Noemie Cabau  (Co-author: Arseniy Samsonov) will present their paper “Signaling Effort: Information Structures in a Principal-Agent model” on February 19th at 10:00 AM, room QA405.


We propose a principal-agent model with moral hazard and non-contractible output where the agent can design a signal about his effort. If there is no signal besides the agent’s, the latter appropriates the first best surplus in every equilibrium. If there is an external signal, the principal can offer a default contract conditioned on it. The agent’s incentive to provide further information stems from the trade-off between lowering the expected punishment and decreasing the expected reward. We show that the agent’s equilibrium signal is informative if he faces a severe and likely punishment under the default contract. We find that the agent benefits from correlating his signal to the outside one and that a more precise external signal may not benefit the principal.

February 7: Daniel Rehsmann   (QSMS Seminar)

Daniel Rehsmann  (University of Vienna) will present his paper “Contesting Fake News” on February 7th at 10:30 AM, room QA406.


We model competition on a credence goods market governed by an imperfect label, signaling high quality, as a rank-order tournament between firms.  In this market interaction, asymmetric firms jointly and competitively control the underlying quality ranking’s precision or verifiability by releasing individual information.  While the labels and the information they are based on can be seen as a public good guiding the consumers’ purchasing decisions, individual firms have incentives to strategically amplify or counteract the competitors’ information emission, thereby manipulating the label’s (or ranking’s) discriminatory power.  Elements of the introduced theory are applicable to several (credence-good) industries which employ labels or rankings, including academic departments, books, music, and investment opportunities.