RESEARCH STATEMENT
My research interests cover areas of dynamic contract theory, macroeconomics, repeated games with private information, and the Chinese labor market. Most of my research has been developed around the core question of how to design optimal dynamic contractual relationships in frictional labor and financial market environments, and how they generate outcomes that can better account for the data? In a specific model we study, for example, a long-term principal-agent relationship may not last forever, both parties can go through a frictional search process to find a new partner, either after the termination of the current contract or while still in the ongoing relationship. The optimal contract is designed as a fully history-dependent plan about not only how to compensate the agent and provide him with proper incentives (to exert effort or report truthfully), but also when to terminate the ongoing relationship. The issues raised include how termination arises as part of the optimal contract, as well as how the optimal contract, with endogenous termination, helps account for the distribution and flows of workers across all three states of the labor market (employment, unemployment and non-participation) and the wage dispersion in the data. In addressing these issues, I developed novel theoretical techniques especially for solving challenging dynamic contracting problems with private information and termination. As a macroeconomist, however, a significant part of my research also involves using sophisticated calibration and stimulation techniques for building a relationship between model and data. (For a detailed research statement, please click here)
My research interests cover areas of dynamic contract theory, macroeconomics, repeated games with private information, and the Chinese labor market. Most of my research has been developed around the core question of how to design optimal dynamic contractual relationships in frictional labor and financial market environments, and how they generate outcomes that can better account for the data? In a specific model we study, for example, a long-term principal-agent relationship may not last forever, both parties can go through a frictional search process to find a new partner, either after the termination of the current contract or while still in the ongoing relationship. The optimal contract is designed as a fully history-dependent plan about not only how to compensate the agent and provide him with proper incentives (to exert effort or report truthfully), but also when to terminate the ongoing relationship. The issues raised include how termination arises as part of the optimal contract, as well as how the optimal contract, with endogenous termination, helps account for the distribution and flows of workers across all three states of the labor market (employment, unemployment and non-participation) and the wage dispersion in the data. In addressing these issues, I developed novel theoretical techniques especially for solving challenging dynamic contracting problems with private information and termination. As a macroeconomist, however, a significant part of my research also involves using sophisticated calibration and stimulation techniques for building a relationship between model and data. (For a detailed research statement, please click here)
Published Papers
[1] Optimal Self-Enforcement and Termination (with Cheng Wang), Journal of Economic Dynamics and Control, 101, 2019, 161-186
[2] Equilibrium Matching and Termination (with Cheng Wang), Journal of Monetary Economics, 76, 2015, 208-229
[3] Outside Opportunities and Termination (with Cheng Wang), Games and Economic Behavior, 91, 2015, 207-228
[1] Optimal Self-Enforcement and Termination (with Cheng Wang), Journal of Economic Dynamics and Control, 101, 2019, 161-186
[2] Equilibrium Matching and Termination (with Cheng Wang), Journal of Monetary Economics, 76, 2015, 208-229
[3] Outside Opportunities and Termination (with Cheng Wang), Games and Economic Behavior, 91, 2015, 207-228
Working Papers
[1] Repeated Moral Hazard with Private Evaluation: Leniency Bias (with Youze Lang), Under Review
[2] Repeated Moral Hazard with Private Evaluation: Why the Agent’s Mixed Strategies Matter
[3] On the Pure Theory of Wage Dispersion (with Cheng Wang), Under Review
[4] Optimal CEO Compensation and Termination (with Cheng Wang)
[5] Search with Information Sharing (with Youze Lang)
[1] Repeated Moral Hazard with Private Evaluation: Leniency Bias (with Youze Lang), Under Review
[2] Repeated Moral Hazard with Private Evaluation: Why the Agent’s Mixed Strategies Matter
[3] On the Pure Theory of Wage Dispersion (with Cheng Wang), Under Review
[4] Optimal CEO Compensation and Termination (with Cheng Wang)
[5] Search with Information Sharing (with Youze Lang)
Working Progress
[1] Optimal Bank Insolvency (with Jia Pan)
[2] Job Creation and Job Destruction in China: 1996-2009 (with Xiaobo Liang)
[3] Optimal Contracting with Adverse Selection and External Shocks
[4] Rotating Savings and Credit Associations (with Haibo Xu)
[5] Wage Dispersion and Capital Misallocation (with Weichao Zhu)
[1] Optimal Bank Insolvency (with Jia Pan)
[2] Job Creation and Job Destruction in China: 1996-2009 (with Xiaobo Liang)
[3] Optimal Contracting with Adverse Selection and External Shocks
[4] Rotating Savings and Credit Associations (with Haibo Xu)
[5] Wage Dispersion and Capital Misallocation (with Weichao Zhu)
Funding
[1] The Unemployment and Mobility of Rural Labor in the Urban Labor Market, National Natural Science Foundation of China, NO.71403160
[1] The Unemployment and Mobility of Rural Labor in the Urban Labor Market, National Natural Science Foundation of China, NO.71403160
Award
[1] Excellent Paper Award 2015 (中振科研基金优秀论文奖), Equilibrium Matching and Termination, Shanghai University of Finance and Economics
[1] Excellent Paper Award 2015 (中振科研基金优秀论文奖), Equilibrium Matching and Termination, Shanghai University of Finance and Economics