Imperial College London

Dr Andre Veiga

Business School

Assistant Professor of Economics



+44 (0)20 7594 7957a.veiga Website




CAGB 484Business School BuildingSouth Kensington Campus





Publication Type

10 results found

Veiga A, Levy Y, 2021, Competitive insurance markets with unbounded cost, Journal of Economic Theory, Vol: 192, Pages: 1-36, ISSN: 0022-0531

Azevedo and Gottlieb (2017) (AG) define a notion of equilibrium that always exists in the Rothschild and Stiglitz (1976) (RS) model of competitive insurance markets, provided costs are bounded. However, equilibrium predictions are fragile: introducing an infinitesimal mass of high-cost individuals discretely increases all prices and reduces coverage for all individuals. We study sensitivity w.r.t. cost bounds by considering sequences of economies with increasing upper bounds of cost, and determining whether their equilibria converge. We present sufficient conditions under which AG equilibrium exists when cost is unbounded. For simple insurance markets, we derive a necessary and sufficient condition for existence: surplus from insurance increases faster than linearly with expected cost. This condition is empirically common. If the condition fails, a higher bound on cost results in market unraveling: all prices diverge and, in the limit, an AG equilibrium does not exist. We use these results to show that the equilibrium for an insurance market with an unbounded continuum of types is characterized by a simple differential equation. We also provide examples of non-existence for a (single-product) market for lemons with unbounded cost.

Journal article

Ahmed K, Hashim S, Khankhara M, Said I, Shandakumar AT, Zaman S, Veiga AFet al., 2021, What drives general practitioners in the UK to improve the quality of care? A systematic literature review, BMJ Open Quality, Vol: 10, ISSN: 2399-6641

Background In the United Kingdom the NHS has various incentivisation schemes in place to improve the provision of high quality care. The Quality Outcomes Framework (QOF) and other Pay for Performance (P4P) schemes are incentive frameworks that focus on meeting predetermined clinical outcomes. However, the ability of these schemes to meet their aims is debated. Objectives1. To explore current incentive schemes available in general practice in the UK, their impact and effectiveness in improving quality of care.2. To identify other types of incentives discussed in the literatureMethodsThis SLR was conducted using the Preferred Reporting Items for Systematic Reviews and Meta-Analyses guidelines. Six databases were searched: Cochrane, PubMed, NICE Evidence, Health Management Information Consortium (HMIC), Embase and Health Management. Articles were screened according to the selection criteria, evaluated against critical appraisal checklists and categorised into themes. Results35 articles were included from an initial search result of 22087. Articles were categorised into the following three overarching themes: financial incentives, non-financial incentives and competition. DiscussionThe majority of the literature focused on QOF. Its positive effects included reduced mortality rates, better data recording and improved socio-demographic inequalities. However, limitations involved decreased quality of care in non-incentivised activities, poor patient experiences due to tick-box exercises and increased pressure to meet non-specific targets. Findings surrounding competition were mixed, with limited evidence found on the use of non-financial incentives in primary care. Conclusion Current research looks extensively into financial incentives, however we propose more research into the effects of intrinsic motivation alongside existing P4P schemes to enhance motivation and improve quality of care.

Journal article

Levy YJ, Veiga A, 2020, On the existence of positive equilibrium profits in competitive screening markets, Games and Economic Behavior, Vol: 124, Pages: 140-168, ISSN: 0899-8256

Frictionless consumer choices and price competition are often associated with competitive markets and vanishing equilibrium profits. We discuss vanishing profits in competitive screening markets like insurance. We assume symmetric firms which exhibit constant returns to scale. Consumer heterogeneity creates the possibility of adverse selection. Firms can offer multiple contracts in equilibrium and (importantly) in any deviation. Nash equilibrium profits vanish if each consumer has a unique optimizing bundle at equilibrium prices or, more generally, if there exists a linear ordering of contracts that dictates the preferences of firms whenever consumers are indifferent between multiple optimal contracts. Of particular interest, equilibrium profits vanish if, for each agent, indifference curves are steeper than iso-profit curves. The results extend to Miyazaki-Wilson-Spence equilibria. We provide examples of economies where there exists an equilibrium with strictly positive profit and show that these examples are robust (hold for an open set of economies).

Journal article

Jiao P, Veiga A, Walther A, 2020, Social media, news media and the stock market, Journal of Economic Behavior & Organization, Vol: 176, Pages: 63-90, ISSN: 0167-2681

We study the effect on stock volatility and turnover of coverage by traditional news media and social media. We find that coverage by traditional news media predicts decreases in subsequent volatility and turnover, but coverage by social media predicts increasesin volatility and turnover. We show that these patters are consistent with a model of “echo chambers”, where social networks repeat news, but some investors interpret repeated signals as genuinely new information.

Journal article

Jiao P, Walther A, 2018, Social media, news media and the stock market, Publisher: SSRN

We study the effect on stock volatility and turnover of coverage by traditional news media and social media. We find that coverage by traditional news media predicts decreases in subsequent volatility and turnover, but coverage by social media predicts increases in volatility and turnover. These patterns are inconsistent with rational models where social and news media both convey information. We show that they are consistent with a model of “echo chambers”, where social networks repeat news, but some investors interpret repeated signals as genuinely new information.

Working paper

Raposo Osorio Veiga A, 2018, A note on how to sell a network good, International Journal of Industrial Organization, Vol: 59, Pages: 114-126, ISSN: 0167-7187

I consider a monopolist in an industry with positive network externalities. The firm can screen heterogeneous consumers by offering multiple products. Screening captures a greater share of consumer surplus but also segregates consumers into multiple products, thereby lowering the total network surplus. Thus, screening is socially inefficient. I show screening is never profit maximizing: the monopolist offers a single product, but at an excessive price. Thus, excessive consumer segregation is unlikely to occur in industries such as online multiplayer games, financial exchanges and messaging software.

Journal article

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.

Journal article

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.

Journal article

Veiga A, Weyl EG, 2016, Product Design in Selection Markets, The Quarterly Journal of Economics, Vol: 131, Pages: 1007-1056, ISSN: 0033-5533

Journal article

Mahoney N, Veiga A, Weyl EG, 2014, Competition policy in selection markets, Publisher: SSRN

Selection markets, like insurance and finance, where the value of customers depends on their identity, create fundamental challenges for competition policy. Competition is often harmful in these markets either by creating socially excessive supply or leading to degradation of product quality. Standard indicators used to gauge policies, such as upward pricing pressure, are also often mis-calibrated in these settings. We summarize for a policy audience and draw competition policy conclusions from two recent papers on the interaction between competition policy and selection, using calibrations to sub-prime auto lending and health insurance.

Working paper

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