LANZI Thomas

This manual studies the strategic behavior of economic agents (consumers, firms, public or private institutions). The first part presents the tools of game theory that allow the analysis of non-contractualized strategic interactions. This is the case of situations where actors do not commit themselves in advance to their strategic behavior, such as in a market where firms are in competition (price, quantity, quality, innovation, investment). In order to cover a broad spectrum, the manual presents the four main configurations of non-cooperative strategic games studied in microeconomics: simultaneous, sequential, repeated and Bayesian. The second part presents the tools of contract theory that allow the analysis of interactions where actors commit to their strategic behavior by means of a contract. Particular attention is paid to situations of asymmetric information, such as those observed in the insurance market or the labor market. The textbook presents the two main types of information asymmetry studied in microeconomics: adverse selection and moral hazard. The particularity of this book is that it approaches these topics with more emphasis on economic reasoning than on mathematical analysis. It facilitates learning and revision through numerous applications and summary problems. Additional digital resources are also provided for teachers.

In this article, we propose to analyze the impact of regret and happiness on the allocation of risky assets. Regret and rejoicing are two emotions that are defined by comparing the outcome of an action chosen by an agent with the outcome that the agent could have obtained by choosing an alternative action. We show that the choice of the alternative action impacts the allocation of risky assets. When the latter is defined in relation to the maximum expected outcome ex post, the agent perceives only regret. This can lead him, for low values of the marginal cost of risk, to retain more risky assets than would an agent maximizing a standard utility expectation. On the contrary, when the agent expresses a preference for certainty, and defines his emotions in relation to what he would get from a total investment in the risk-free asset, we show that the investment in risky assets is lower than the investment made by an agent maximizing a standard utility expectation.

We study optimal contracting in a communication setting in which an uninformed principal has the opportunity to undertake an outside option if an informed agent refuses the contract. The contract specifies a decision rule and a transfer for each unit of information revealed by the agent. Due to the existence of the outside option, the informational rent isnonmonotonic, and we characterize the properties of the optimal contract. We show that the outside option becomes a credible threat for the agent because it allows the principal to punish him severely with negative transfers. Moreover, we compare our optimal contract to the one under perfect commitment without an outside option developed by Krishna and Morgan [2008]. We find that regardless of the divergence of preferences between the principal andthe agent, the contract with an outside option is always better for the principal. Moreover, we show that the threat of using an outside option increases information extraction.

In many economic contexts where the information available to decision-makers is incomplete, the use of expertise can be an effective tool for decision support. However, the informational advantage held by the expert can lead him to manipulate his information in order to satisfy his private interests. The first part of this thesis addresses this problem by considering a bilateral relationship between an expert and a decision maker. We analyze the strategic disclosure of the expert's information through various communication mechanisms. In particular, we consider an incentive mechanism through which the expert is paid for his recommendations, a Cheap-Talk mechanism and a Persuasion mechanism. Moreover, in a problem where scientific uncertainty is more radical, we compare the decisions resulting from two decision criteria that attempt to account for two different logics of interpretation of the precautionary principle, the Maxmin EU criterion and the criterion of minimizing the maximum of the regret expectation.