ON THE MICROECONOMICS OF CONTRACTS (INFORMATION, UNCERTAINTY)
This thesis analyzes the markets for intermediate (industrial) products. Transactions in these markets are usually made through both long term contracts and spot contracts. The models currently available in the "economics of contracts" literature are of limited interest for the study of the transactions in intermediate product markets. Special structural characteristics, present in many of these markets, requires building models that can represent them with more fidelity. We have built three models that try to capture the special structural characteristics of intermediate product markets. However, this thesis has other theoretical contributions. In the current literature of "economics of information", attention has been concentrated on prices as the mechanism through which information is disseminated in the economy. But, we believe that quantities are important signals about the information present in the economy, and that agents use it intensively. This thesis focuses on quantity as the information transmission mechanism. This thesis also studies markets where equilibrium prices are not reached by an auctioneer-like process of price formation. Instead, prices are announced unilaterally by one of the parts of a transaction (the seller), and the other part (the buyer) has discretion over the quantity transacted at the announced price. Another contribution of this thesis is that it approaches the contracting problem from a new point of view. A typical paper on contracts starts with the description of some market structure and tries to find the "optimum" (in some sense) contract for that structure. We, instead, starting with observed real world contracts, investigate which structural characteristics of a market would give rise to real world contracts as a reasonable outcome.
|Year of publication:||
|Authors:||COUTINHO, PAULO CESAR|
|Type of publication:||Other|
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