This Friday, the Department of Economics is hosting a mini conference in Industrial Organization. Four speakers will present papers throughout the day; Bradley Larsen (Stanford University), Sylvia Hristakeva (UCLA Anderson), Nick Buchholz (Princeton University), and John Lazarev (New York University). The conference will be held in Lorch Hall room 201.

Below you will find information on each speaker, the time of their presentations, and a link to the papers that they will be presenting on. Everyone is welcome to the breakfast and coffee breaks during the conference. Contact Assistant Professor Ying Fan for more information.


Bradley Larsen (Stanford University):


We present an equilibrium search model that parsimoniously rationalizes the use of auctions as a sales mechanism for new-in-box goods—a frequent occurrence in online retail markets—and analyze whether the existence of these auctions is welfare enhancing relative to a market consisting only of posted prices. Buyers have a deadline by which the good must be purchased, and sellers choose between auctions and posted-price mechanisms. As the deadline approaches, buyers increase their bids and are more likely to buy through posted-price listings. The model predicts equilibrium price dispersion even for new, homogeneous goods. Using data on one million auction and posted-price listings for new-in-box items on, we find robust evidence consistent with our model. As predicted, bidders increase their bids from one auction to the next, equilibrium price dispersion exists, and auctions and posted-price listings coexist. Fitting the model to the data, we find that retail auctions increase total welfare by 1.8% of the average retail price if listing fees exactly cover platform costs, but reduce welfare by 2.3% if listing fees are pure profit.

Sylvia Hristakeva (UCLA Anderson)


Producers frequently provide financial incentives to retailers in order to gain distribution for their products. These payments often take the form of vendor allowances: lump-sum transfers to retailers that do not directly depend on volume. To quantify the size of vendor allowances and their effects on product assortments and welfare, I develop a framework to identify lump-sum transfers using only data on retail prices, sales, and assortments. Without making any assumptions about producer and retailer bargaining, set estimates of vendor allowances are recovered. Additionally, by assuming that producers make take-it-or-leave-it offers, point estimates can be obtained. Lower bounds from set estimates imply that, on average, vendor allowances amount to at least 5% of retailer revenues. I apply model estimates to simulate how market outcomes change in the absence of vendor allowances. Counterfactual simulations predict that retailers fare worse, product variety is reduced as retailers replace “niche” products with “mainstream” options, but consumers nevertheless are better off. Small producers, which offer high-velocity products, increase market distribution and profits, but, absent marginal cost data, consequences for large producers are uncertain.

Nick Buchholz (Princeton University)


This paper analyzes the dynamic spatial equilibrium of taxicabs and shows how common taxi regulations lead to substantial inefficiencies. Taxis compete for passengers by driving to different locations around the city. Search costs ensure that optimal search behavior will still result in equilibrium frictions in the form of waiting times and spatial mismatch. Medallion limit regulations and fixed fare structures exacerbate these frictions by preventing markets from clearing on prices, leaving empty taxis in some areas, and excess demand in other areas. To analyze the role of regulation on frictions and efficiency, I pose a dynamic model of search and matching between taxis and passengers under regulation. Using a comprehensive dataset of New York City yellow medallion taxis, I use this model to compute the equilibrium spatial distribution of vacant taxis and estimate intraday demand. My estimates show that search frictions reduce welfare by $422M per year, or 62%. Counterfactual analysis reveals that existing regulations attain only 11% of the efficiency implied by a social planner’s solution, while the adoption of optimized two-part tariff pricing would lead to 89% efficiency, or a welfare gain on the order of $2.1B per year. The addition of directed matching technology to an optimized regime would increase welfare even further, by approximately $2.4B per year.

John Lazarev (New York University):

  • “Input Allocation and Downstream Market Structure: Slot Control in the U.S. Airline Industry”
  • Presentation from 3:30-5 pm


To help manage airport congestion and reduce delays, airlines operating at four U.S. airports must obtain from the FAA operating authorizations called "slots" to take off or land. Currently, the FAA allocates the slots using the "use-it-or-lose-it" rule. Because of that, the current system of slot control may inadvertently make these airports more congested as it creates incentives for the airlines to hoard the slots. The goal of the paper is to theoretically and empirically investigate the link between input allocation and the downstream market structure. I estimate a structural econometric model of airline competition. Using this model, I recalculate the downstream equilibrium for a set of alternative mechanisms of slot allocation.