WORK IN PROGRESS

• Truth-Telling in a Priority Pricing Mechanism

  (Job Market Paper)

  Abstract

  This paper studies the impact of truth-telling preferences on aggregate consumer welfare within a priority pricing (PP) mechanism. Traditional models assume individuals always misrepresent private information to maximize payoffs, yet recent evidence suggests there may be an innate preference for truth-telling. By incorporating these preferences, I find that PP enhances welfare over uniform pricing only when the probability of non-truthful individuals surpasses a critical threshold, suggesting that PP may benefit populations with low truth-telling tendencies but reduce welfare when this tendency is high. To empirically test this, I conducted an online experiment, finding that while PP incentivized truth-telling, its impact did not vary significantly across groups with differing truth-telling tendencies. Instead, participants’ beliefs about others’ truthfulness emerged as key in shaping behavior. These findings underscore that PP’s welfare-enhancing potential depends not only on incentives created by the pricing structure but also on the population’s truth-telling tendencies and beliefs, offering valuable insights for designing effective pricing mechanisms.

  Presented at: Copenhagen Network for Experimental Economics Workshop (Lund, 2024)

• Blood Supply Allocation: Trade-off Between Equity and Efficiency

  Abstract

  Blood supply allocation can involve a trade-off between equity and efficiency. While ABO-compatible pooling can promote equitable access across blood types by redistributing supply among all compatible blood types, it may reduce the total number of treated patients in a steady-state setting. This paper derives a domination criterion for ABO-compatible pooling and shows that in iterative pairwise pooling procedures, the final allocation does not result in efficiency loss if this criterion is met at each step. Simulations based on the plasma donation and demand model by Kominers et al. (2020) indicate that failing to satisfy this criterion leads to inefficiencies in 7.11% of cases, with the number of treated patients decreasing by an average of 0.60% to 1.03%. These findings highlight the need to integrate efficiency considerations into blood allocation mechanisms to prevent equity-driven pooling from inadvertently reducing the number of treated patients.

  
  

PUBLICATIONS (Peer-Reviewed Journals)

• Multiple Pricing for Personal Assistance Services With Tommy Andersson, Lina Maria Ellegård, Andreea Enache, and Albin Erlanson.

  Economic Modelling, Vol 141, 2024

  Abstract

  Third-party payers often reimburse health care providers based on prospectively set prices. Although a key motivation of prospective payment is to contain costs, this paper shows that this aspect crucially depends on the design of the pricing scheme due to the well-known incentives of patient selection (or “dumping”). This paper provides a general theoretical framework where heterogeneous users are served by either private for-profit or public providers, each paid an hourly compensation by a third-party payer. The private, but not the public providers may select patients. It is demonstrated that this realistic feature of the model implies that total costs depend on the number of prices. The features of the model are illustrated using the Swedish system of personal assistance services as a motivating example. Numerical results show that marginal adjustments to the current uniform pricing scheme would lead to substantial savings.

  Presented at: 12th Conference on Economic Design (Padova, 2022)

  Supplimentary Material: Replication Codes
  
  

OTHER

• Labour Migration and Skills Training With Ashim Bhattarai.
  

  CESLAM Policy Brief No. 7, 2015

  Abstract

  Of the half a million or so Nepalis who left the country for work in 2013/14, nearly three quarters were classified as ‘unskilled’. This tendency of the majority of migrants being poorly trained is a cause for concern since low-skilled and ‘unskilled’ workers are more vulnerable to exploitation and abuse, are accorded fewer job benefits, and face limited earning potential. Addressing this issue will require a strong, well-organised technical and vocational education sector which is also attuned to the needs of the foreign employment labour market. This policy paper provides an overview of Nepal’s technical training sector, identifies the key challenges and issues that need to be addressed vis-à-vis labour migration, and provides recommendations on how these could be addressed.

• Migration and Resilience: Experiences from Nepal’s 2015 Earthquake With Bandita Sijapati, Jeevan Baniya, Anish Bhandari, Ashim Bhattarai, Sambriddhi Kharel, Amrita Limbu, Dinesh Pathak and Nabin Rawal.
  

  Research Paper VII, CESLAM, 2015

  Introduction

  A landlocked country with diverse geographic and climatic features, Nepal is known to be highly vulnerable to a range of natural hazards, particularly droughts, earthquakes, floods and landslides. The risk arising from natural disasters is further exacerbated by the poor socio-economic condition of the country’s population. Over the past two decades, Nepal’s record in reducing poverty has been noteworthy, with poverty headcount having fallen from 42 per cent in 1995/96 to 25 per cent in 2010/11. Yet, a significant number of households remain ever vulnerable to slipping back into poverty as over 70 per cent of Nepalis still live on less than USD 2.5 a day. To exacerbate matters, inequality across social groups and regions has persisted over the years. Thus, the Central Region with an HDI of 0.510 (in 2011) has consistently ranked at the top while the Far-Western Region with an HDI of 0.435 has remained at the bottom. In terms of regional comparison, Nepal’s 2011 HDI score of 0.458 is among the lowest in South Asia.

  In such a context, outmigration (both internal and external), especially of the youth for employment opportunities, has been high. In the fiscal year 2013/14 alone, approximately half a million Nepalis, mainly young men and women, took up foreign employment. (This figure excludes migrants to India and migrant workers who went abroad without government-issued labour permits, both categories that are not captured in the government data.) The total official remittance received during the first nine months of FY 2013/14 was almost NPR 400 billion (USD 4 billion), or close to 30 per cent of the country’s total GDP.

  In the aftermath of the M 7.8 earthquake that struck central Nepal on 25 April 2015, and its aftershocks, particularly a major one of M 7.3 on 12 May 2015, issues related to the links between migration and disaster-preparedness as well as coping strategies adopted by the affected population have come to the fore. To examine such linkages, the Centre for the Study of Labour and Mobility (CESLAM) at the Social Science Baha (SSB), with support from the International Labour Organisation (ILO) and the International Migration Initiative of the Open Society Foundations, New York, undertook a quick assessment in four of the 14 severely affected districts, namely, Sindhupalchowk, Kavrepalanchowk, Dhading and Kathmandu, to understand how households with migrants—both external and internal—have coped with the natural disaster and whether there is any evidence of greater resilience on the part of such households.