arXiv subjects

Paula Onuchic

Publications and source records attributed to Paula Onuchic.

7 recordsLinked to original sources

arXiv2026

Misperception and informativeness in statistical discrimination

We study the interplay of information and prior (mis)perceptions in a Phelps-Aigner-Cain-type model of statistical discrimination in the labor market. We decompose the effect on average pay of an increase in how informative observables are about workers' skills into a non-negative instrumental component, reflecting increased surplus due to better matching of workers with tasks, and a perception-correcting component capturing how extra information diminishes the importance of prior misperceptions about the distribution of skills in the worker population. We sign the perception-correcting term: it is non-negative (non-positive) if the population was ex-ante under-perceived (over-perceived). We then consider the implications for pay gaps between equally-skilled populations that differ in information, perceptions, or both, and identify conditions under which improving information narrows pay gaps.

econ.TH↗

arXiv2026

Separating the Wheat from the Chaff

We study a reputational cheap-talk environment in which a judge, who is privately and imperfectly informed about a state, must choose between two speakers of unknown reliability. Exactly one speaker is an expert who perfectly observes the state, while the other is a quack with no information. Both speakers seek to be selected, while the judge wishes to identify the expert. We show that, quite generally, there is an equilibrium in which the expert is honest, yet the judge favors more extreme signals. This bias toward extremism does not induce exaggeration by the expert, but instead sustains truthful communication. The quack strategically mimics the expert's speech, and sometimes panders to the judge's prior. We show that learning in this environment exhibits an ``information begets information'' property: judges with more precise private information are more likely to identify the expert and learn the true state, implying that exposure to competing sources of uncertain reliability may amplify informational inequality across audiences.

econ.TH↗

arXiv2025

Recent Contributions to Theories of Discrimination

This paper surveys the literature on theories of discrimination, focusing mainly on new contributions. Recent theories expand on the traditional taste-based and statistical discrimination frameworks by considering specific features of learning and signaling environments, often using novel information- and mechanism-design language; analyzing learning and decision making by algorithms; and introducing agents with behavioral biases and misspecified beliefs. An online appendix attempts to narrow the gap between the economic perspective on ``theories of discrimination'' and the broader study of discrimination in the social science literature by identifying a class of models of discriminatory institutions, made up of theories of discriminatory social norms and discriminatory institutional design.

econ.TH↗

arXiv2023

Advisors with Hidden Motives

I study a model of advisors with hidden motives: a seller discloses information about an object's value to a potential buyer, who doesn't know the object's value or how profitable the object's sale is to the seller (the seller's motives). I characterize optimal disclosure rules, used by the seller to steer sales from lower- to higher-profitability objects. I investigate the effects of a mandated transparency policy, which reveals the seller's motives to the buyer. I show that, by removing the seller's steering incentive, transparency can dissuade the seller from disclosing information about the object's value, and from acquiring that information in the first place. This result refines our understanding of effective regulation in advice markets, and links it to the commitment protocol in the advisor-advisee relation.

econ.TH↗

arXiv2023

Disclosure and Incentives in Teams

We consider a team-production environment where all participants are motivated by career concerns, and where a team's joint productive outcome may have different reputational implications for different team members. In this context, we characterize equilibrium disclosure of team-outcomes when team-disclosure choices aggregate individual decisions through some deliberation protocol. In contrast with individual disclosure problems, we show that equilibria often involve partial disclosure. Furthermore, we study the effort-incentive properties of equilibrium disclosure strategies implied by different deliberation protocols; and show that the partial disclosure of team outcomes may improve individuals' incentives to contribute to the team. Finally, we study the design of deliberation protocols, and characterize productive environments where effort-incentives are maximized by unilateral decision protocols or more consensual deliberation procedures.

econ.TH↗

arXiv2022

Statistical discrimination and statistical informativeness

We study the link between Phelps-Aigner-Cain-type statistical discrimination and familiar notions of statistical informativeness. Our central insight is that Blackwell's Theorem, suitably relabeled, characterizes statistical discrimination in terms of statistical informativeness. This delivers one-half of Chambers and Echenique's (2021) characterization of statistical discrimination as a corollary, and suggests a different interpretation of it: that discrimination is inevitable. In addition, Blackwell's Theorem delivers a number of finer-grained insights into the nature of statistical discrimination. We argue that the discrimination-informativeness link is quite general, illustrating with an informativeness characterization of a different type of discrimination.

econ.TH↗

arXiv2021

Conveying Value via Categories

A sender sells an object of unknown quality to a receiver who pays his expected value for it. Sender and receiver might hold different priors over quality. The sender commits to a monotonic categorization of quality. We characterize the sender's optimal monotonic categorization. Using our characterization, we study the optimality of full pooling or full separation, the alternation of pooling and separation, and make precise a sense in which pooling is dominant relative to separation. We discuss applications, extensions and generalizations, among them the design of a grading scheme by a profit-maximizing school which seeks to signal student qualities and simultaneously incentivize students to learn. Such incentive constraints force monotonicity, and can also be embedded as a distortion of the school's prior over student qualities, generating a categorization problem with distinct sender and receiver priors.

econ.TH↗