- Conflict and Development (with Prabal Roy Chowdhury) ISID Discussion Papers in Economics, Discussion Paper 15-05
Abstract: We examine a dynamic two-stage incumbent-challenger model of internal conflict, where the government, i.e. the incumbent, is in power, while the rebel challenges the government in a bid to capture state power. The central issue is the trade-off between development and security-based measures in countering such rebellion activity. We find that while an exogenous increase in development decreases the level of rebellion activity, it increases the level of security based measures by the government. Further, if the rebel is ‘dominant’ to begin with, then, with the rebel becoming stronger, the level of rebel activity increases, while the security based measures by the government is lowered. Finally, if the rebel becomes stronger (i.e. becomes more cost efficient), then the government might find it optimal to decrease the level of development. Thus our analysis suggests that the trade-off is a nuanced one.
- Centralisation and Delegation: A Principal-Agent Analysis
Abstract: We study two types of organizational structures, namely centralization and delegation. Centralization refers to a contractual relationship where the principal contracts with all the agents directly. Delegation refers to a contractual relationship where the principal contracts with some agents (a proper subset, to be precise) and give them the right to contract with others. We allow for the collusion among agents. Both these contracts are quite common in production networks, supply chain management and procurement . We provide an intuitive model for the collusion among agents. We show that the collusion among agents maybe beneficial for the principal also. Hence the whole issue of justifying delegation as counter-strategy to collusion is somewhat misplaced. We provide a sufficient condition under which delegation outperforms centralization. We provide the first-order conditions which characterize Nash equilibrium outcomes for both, centralization with and without collusion cases.
- Conflicts: Using Development as Signal (with Prabal Roy Chowdhury)
- Difference-Form Contest Success Functions: Existence, Uniqueness and Stability of the Pure Strategy Nash Equilibrium