Theory seminar presented by Andreas Kleiner (Arizona State U)

Abstract: We characterize the set of extreme points of monotonic functions that are either
majorized by a given function f or themselves majorize f and show that these extreme
points play a crucial role in many economic design problems. Our main results show
that each extreme point is uniquely characterized by a countable collection of intervals.
Outside these intervals the extreme point equals the original function f and inside the
function is constant. Further consistency conditions need to be satisfied pinning down
the value of an extreme point in each interval where it is constant. Finally, we apply
these insights to a varied set of economic problems: equivalence and optimality of
mechanisms for auctions and (matching) contests, Bayesian persuasion, optimal
delegation, and decision making under uncertainty.

Zoom Meeting ID: 933 0940 4476
Password: 085143