Research

My current research agenda involves decision under uncertainty and aggregation economics.

Job Market Paper

Quota Baskets versus Tax Baskets in Fisheries

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Abstract: Because managing stocks individually is costly, many fisheries bundle multiple stocks and manage them with a single instrument. I study when such bundling is desirable and whether it should take the form of a shared quota or a shared landing fee, extending the constant-escapement framework of Reed (1979)) and Weitzman (2002) to a multispecies fishery under ecological uncertainty.

The fundamental condition for a well-designed basket is equalizing marginal profits across species, a condition that combines biological productivity, harvesting costs, and prices. Under this criterion, I find that the tax basket outperforms the quota basket. However, two qualifications refine this result: (i) both instruments coincide and are first-best when marginal profits are equalized at each species’ optimal escapement in a deterministic setting; and (ii) as the number of species in the group increases, the quota’s uncertainty loss is diversified away, reducing the average per-species welfare gap. Yet increasing the basket size has a second cost: the mismatch from pooling heterogeneous species grows with the number of species for both instruments. Larger baskets are not always better.

Bundling improves on species-specific management only when the monitoring costs it saves exceed this pooling loss.

Work in Progress

Prices vs. Quantities Under Complexity Constraints

Extends Weitzman’s (1974) instrument-choice framework to a multi-good static setting in which regulated goods are correlated through non-separable benefits (substitutes or complements) and jointly distributed cost and benefit shocks.

Weak Property Rights and Resource Extraction

Shows that heterogeneity in firms’ effective discount rates (capturing institutional risk and weak property rights) generates accelerated extraction and distortions of the classic Hotelling path in a competitive non-renewable resource market.

Aggregate Quotas under Depletion Risk (with Shu-chen Tsao)

Considers a setting in which a regulator cannot distinguish species at port and therefore sets a single aggregate quota, while one species within that aggregate requires near-zero harvest to recover; characterizes the socially optimal aggregate quota under this constraint.