EconCS Seminar - Jaisun Li

— 1:00pm

Location:
In Person - ASA Conference Room, Gates Hillmn 6115

Speaker:
JIASUN LI, Visiting Faculty, Computer Science Department, Carnegie Mellon University, and, Associate Professor of Finance (on sabbatical) , George Mason University
https://sites.google.com/view/jiasunli

Profit Division Among Privately-Informed Agents and Beyond

When n privately-informed investors (or AI agents on behalf of them) jointly invest in a risky project, how should they divide profit? Is the familiar practice of dividing in proportion to initial investments really optimal? In a simple example, I demonstrate that the Pareto dominant outcome may only be implemented by a Bayesian Nash equilibrium when agents equally share profits, regardless of their initial contributions or private information precisions. 

In the first half of the talk, I will prove this statement analytically under fairly standard utility/signal assumptions, and reconcile it with the familiar practice of dividing according to initial contributions. Then in the second half of the talk, I will open up to several potential directions for further generalization and discuss ongoing work along them, envisioning how they may inspire (1) the co-design of statistical learning algorithms and contracts and (2) overcoming numerous impossibility results in mechanism design with a relaxed solution concept of Bayesian Nash equilibrium of contingent schedules. I will also discuss potential applications, including the design of decentralized autonomous organizations (DAO), the augmentation of secure multi-party computation (MPC), the development of intent-based markets, and the design of crowdfunding for harnessing the "wisdom of the crowd", etc. 

— About the Seminar:  This seminar is designed for those working on or otherwise interested in topics at the intersection of computer science and economics (algorithmic game theory, computational social choice, mechanism design, etc).  

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