MARCO M. OTTAVIANI

Working papers

Grantmaking, Grading on a Curve, and the Paradox of Relative Evaluation in Nonmarkets


Jerome Adda and Marco Ottaviani

Forthcoming Quarterly Journal of Economics

Model of nonmarket allocation of resources such as the awarding of grants to meritorious projects, honors to outstanding students, or journal slots to quality publications.

Key theoretical novelty: Lehmann (1988) information as a tractable tool for general comparative statics.

Main prediction of the model: Participation in a field increases as evaluation in that field becomes noisier & as evaluation in other fields becomes less noisy.

Key empirical result: Prediction confirmed in the data exploiting 2014 change in budget apportionment rule at the ERC.  



Last change 13/11/2023

When Liability is Not Enough: Regulating Bonus Payments in Markets With Advice


Jun Honda, Roman Inderst, and Marco Ottaviani

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In a number of markets, competing product providers compensate sales agents and advisors through nonlinear incentive schemes with bonuses. How should policy makers regulate nonlinear incentives in markets with advice? Is it enough to step up liability or should the shape of the compensation structure of advisors be regulated more directly?



Last change 18/01/2024

Information Markets and Nonmarkets


Dirk Bergemann and Marco Ottaviani

This chapter, prepared for Volume 4 of the Handbook of Industrial Organization, overviews contributions to the industrial organization of information markets and nonmarkets, while attempting to maintain a balance between foundational frameworks and more recent developments. We start by reviewing mechanism-design approaches to modeling the trade of information. We then cover ratings, predictions, and recommender systems. We turn to forecasting contests, prediction markets, and other institutions designed for collecting and aggregating information from decentralized participants. Finally, we discuss science as a prototypical information nonmarket with participants who interact in a non-anonymous way to produce and disseminate information. 



Last change 07/01/2022

Separate or Joint Financing? Optimal Conglomeration with Bankruptcy Costs


Albert Banal Estanol and Marco Ottaviani.

How should multiple and possibly heterogeneous risky projects be optimally grouped into separately financed conglomerates?



Last change 14/05/2013

Search Agency


Tracy R. Lewis and Marco Ottaviani

How should a principal provide agents with incentives to conduct sequential search?



Last change 21/12/2012

The Timing of Parimutuel Bets


Marco Ottaviani and Peter Norman Sorensen.

Timing of parimutuel bets driven by two incentives: bettors want to place large early bets to pre-empt the rivals, but also want to wait to conceal information.



Last change 21/06/2013

Parimutuel versus Fixed-Odds Markets


Marco Ottaviani and Peter Norman Sorensen

Comparison of equilibrium outcomes in parimutuel and fixed-odds competitive markets with privately informed bettors.



Last change 21/06/2013

Forecasting and Rank-Order Contests


Marco Ottaviani and Peter Norman Sorensen

Characterization of equilibrium in Hotelling location model with private information, with applications to strategic forecasting and political economy.



Last change 21/06/2013

Contracts and Competition in the Pay-TV Market


David Harbord and Marco Ottaviani

How is downstream competition affected by the contractual terms used to sell essential inputs to competitors?



Last change 21/12/2012

The Economics of Advice


Marco Ottaviani

Analysis of issues relevant for regulation of independent financial advisers: communication to unsophisticated audience, information acquisition by advisers, uncertainty about the conflict of interest, and optimal incentive design.



Last change 21/12/2012

Last change 18/11/2011