On Monday, March 6 ISET hosted its graduate Robizon Khubulashvili, a PhD Student of Pennsylvania State University. Robizon presented his working paper entitled “Endogenous Team Formation Among Competitors”.
In this paper, Robizon analyzed endogenous group formation when competition among teammates is a concern. He showed an algorithm that could be used to find an equilibrium in which all the members of the competitors' group want to be in the group and want to exchange their information with every other member of the group.
Robizon also had answers to some interesting questions from group theory and organizational economics. First, he characterized conditions under which team managers should improve weak players of the team; the interesting result was that even if one player is more important than another, there is a strong incentive to improve the less important player. He also showed that team with homogeneous members have higher expected value than an average ability team with more heterogeneous members. Finally, Robizon addressed matching problems, and discussed allocation of agents in pairs.
Behavioral economics is one of the most notable fields of modern economics. It draws insights from psychology, sociology, biology, and other social sciences.
On 24th of November, ISET hosted Teimuraz Gogsadze, a graduate of the Class of 2011, who gave an introductory lecture in behavioral economics. Gogsadze started his talk by formally defining the scope of behavioral economics. He then discussed the antecedents and historical context of the field, highlighting the importance of psychological realism of assumptions in economic modelling before the start of 20th century and the gradual removal of psychology from economics during the first half of the 20th century.
On November 14, Dr. Nadja El Benni, employed at the Research Institute of Organic Agriculture (FiBL) until October 2016 and starting at Agroscope (Swiss Confederation’s centre of excellence for agricultural research) in January 2017 as head of the Strategic Research Division “Competitiveness and System Evaluation”, visited ISET. She delivered a presentation entitled “Perception of food quality and authenticity of Chinese consumers”. The melamine scandal of 2008 and a series of related scandals in the years thereafter has led to low levels of trust in the safety and integrity of domestically produced Chinese infant milk formula; concerned parents in China are increasingly using ‘foreign-produced’ brands.
On November 21, Prof. Dr. Stephan von Cramon-Taubadel gave a presentation of a working paper entitled “Trade Costs for Heterogeneous Agricultural Products” at ISET. The professor himself and Mr. Yi Qu are the co-others of the paper, which aims to evaluate trade costs for 125 different agricultural products based on 1992-2011 data from 156 different countries.
Geographic characteristics (island or mainland, number of neighboring countries, etc.), transportation (the distance products cover domestically or internationally), tariffs (on exports and imports), institutions and the history of the country, as well as demographic characteristics (the religion of the majority of the population in a particular trading partner, common language, etc.) serve a role of explanatory variables in the analyses.
On November 7, ISET hosted Professor Rögnvaldur Hannesson of the Norwegian School of Economics, who gave a presentation entitled ‘Tradable Fish Quotas and Return on Capital in Norwegian Fisheries’.
Dr. Hannesson started by defining a key problem facing the Norwegian fishing industry. Water basins are generally considered to be common property, as well as the fish inside them, and so fishermen consider water basins as an unlimited resource for their profit. However, this problem usually leads to a situation wherein fishermen use more effort to catch a fish than the revenue returns their work brings. Dr. Hannesson explained that there are two ways to solve the problem: the introduction of taxation or quotas. Dr. Hannesson used data from the Norwegian fishing industry to check whether the introduction of quotas does indeed help to solve the problem of overfishing and to increase return on capital in this industry.