4 results found
Raposo Osorio Veiga A, 2018, A Note on How to Sell a Network Good, International Journal of Industrial Organization, ISSN: 0167-7187
Weyl EG, Veiga A, 2017, Pricing institutions and the welfare cost of adverse selection, American Economic Journal: Microeconomics, Vol: 9, Pages: 139-148, ISSN: 1945-7669
To mitigate adverse selection in insurance markets, individuals are often mandated to buy at least a baseline plan, but may choose to opt into a premium plan. In some markets, such as US health exchanges, each plan is responsible for the full expenses of those who buy it ("total pricing"). In other markets, such as the privately supplied "Medigap" top-ups to traditional government-provided Medicare, premium providers are only responsible for the incremental expenses they top up ("incremental pricing"). For parameter values calibrated to health exchanges, the shift from total to incremental pricing reduces the welfare loss from adverse selection by an order of magnitude.
Veiga A, Weyl EG, White A, 2017, Multidimensional platform design, American Economic Review, Vol: 107, Pages: 191-195, ISSN: 0002-8282
Successful platforms attract not just many users, but also those of the right kind. 'The right kind of user' is one who can either be directly monetized or who differentially attracts other valuable users. Bonacich centrality on the network of user sorting with direct value of monetization captures this feedback loop and thus characterizes the value of user characteristics. We use this value to determine optimal steady-state platform design and reliable means for platforms to reach such a steady state. We apply these results respectively to explain the dynamic growth strategy of social networks and urban development policies of cities.
Veiga A, Weyl EG, 2016, Product Design in Selection Markets, The Quarterly Journal of Economics, Vol: 131, Pages: 1007-1056, ISSN: 0033-5533
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