

John K.H. Quah
Department
of Economics
Oxford
University
Manor
Road, OX1 3UL

Email: john.quah@economics.ox.ac.uk Phone:
01865281291 (Economics Department); 01865274986 (St Hugh’s College)
Department webpage
College
Webpage Brief Bio
Office Hours Slides for Lectures
Research interests: monotone
comparative statics, statistical decision theory, informativeness,
supermodular games
consumer theory, demand aggregation, general equilibrium
theory
revealed preference tests
environmental economics
Published (or soontobe published) Papers
· Revealed preference tests of the Cournot model (with Andres Carvajal, Rahul Deb, and James Fenske). Forthcoming article in Econometrica.
There is also working paper with other results.
We consider an observer who makes a finite number of observations of an industry producing a homogeneous good, where each observation consists of the market price and firm specific production quantities. We develop a revealed preference test (in the form of a linear program) for the hypothesis that the firms are playing a Cournot game, assuming that they have convex cost functions that do not change and the observations are generated by the demand function varying across observations.
· Emissions trading with profitneutral permit allocations (with Cameron Hepburn and Robert Ritz), Journal of Public Economics, Vol. 98, 8599 (2013).
We examine the impact of an emissions trading scheme (ETS) on equilibrium emissions, output, price, market concentration, and profits in a generalized Cournot model. We develop formulae for the number of emissions permits that have to be freely allocated to firms to neutralize the profit impact of the ETS. We show that its profit impact is usually limited: in a Cournot oligopoly with constant marginal costs, total industry profits are preserved so long as freely allocated permits cover a fraction of initial emissions that does not exceed the industry's Herfindahl index.
·
Revealed
Preference in a Discrete Consumption Space (with Matthew Polisson),
American Economic Journal: Microeconomics, Vol. 5(1), 2834 (2013).
We
show that an agent maximizing some utility function on a discrete (as opposed
to continuous) consumption space will obey the generalized axiom of revealed
preference (GARP) so long as the agent obeys cost efficiency. Cost efficiency
will hold if there is some good, outside the set of goods being studied by the
modeller that can be consumed by the agent in continuous quantities. An
application of Afriat's Theorem then guarantees that
there is a strictly increasing utility function on the discrete consumption
space that rationalizes price and demand observations in that space.
·
Aggregating
the single crossing property (with Bruno Strulovici). Econometrica, Vol.
80 (5), 23332348 (2012)
The
single crossing property plays a crucial role in economic theory, yet there are
important instances where the property cannot be directly assumed or easily
derived. Difficulties often arise because the property cannot be aggregated:
the sum or convex combination of two functions with the single crossing
property need not have that property. We introduce a new condition
characterizing when the single crossing property is stable under aggregation
and also identify sufficient conditions for the preservation of the single
crossing property under multidimensional aggregation. We use our results to establish properties of
objective functions (convexity, logsupermodularity),
the monotonicity of optimal decisions under uncertainty, and the existence of
monotone equilibria in Bayesiangames.
Seminar
slides for this paper are
available.
·
Comparative
Statics, Informativeness, and the Interval Dominance
Order (with
Bruno Strulovici), Econometrica,
Vol. 77 (6), 19491992 (2009).
This paper identifies a new way to order
functions, called the interval dominance order, that generalizes both the single
crossing property and a standard condition used in statistical decision theory.
This allows us to provide a unified treatment of the major theorems on monotone
comparative statics with and without uncertainty, the comparison of signal informativeness, and a nonBayesian theorem on the
completeness of increasing decision rules. We illustrate the concept and
results with various applications, including an application to optimal stopping
time problems where the single crossing property is typically violated.
Seminar
slides and also slides on background material are available. Additional related material is found in Comparative Statics with
the Interval Dominance Order: Some Extensions (incomplete notes dated 9
December 2007; fuller version to be posted at a later date).
·
The
existence of equilibrium when excess demand obeys the weak axiom, Journal of Mathematical
Economics, Vol. 44(34), 337343 (2008)
This paper gives an elementary and instructive proof
of equilibrium existence when the excess demand correspondence obeys the weak
axiom of revealed preference.
· The comparative statics of constrained optimization problems, Econometrica, Vol. 75, No. 2, 401431 (2007)
This paper extends of the methods of monotone
comparative statics to deal with commonlyencountered comparative statics
problems involving changes to constrain sets.
See also Additional notes on the comparative statics of constrained optimization problems, Working Paper, Nuffield College, Oxford, No. 2006W09.
· A contribution to duality theory, applied to the measurement of risk aversion, (with Juan Enrique MartinezLegaz) Economic Theory, Vol. 30, No. 2, 337362 (2007)
We examine the precise connection between the curvature properties of an objective function and the raycurvature properties of its dual. When the objective function is interpreted as a Bernoulli or cardinal utility function, our results characterize the relationship between an agent’s attitude towards income risks and her attitude towards risks in the underlying consumption space.
· Weak Axiomatic Demand Theory, Economic Theory, Vol. 29, No. 3, 677699 (2006)
This paper identifies a class of complete but not necessarily transitive preferences which generate demand functions that obey the weak axiom of revealed preference and within which any function obeying the weak axiom can be rationalized.
· Homothetic or CobbDouglas behavior through aggregation, Contributions to Theoretical Economics, Vol. 3, No. 1, Article 8 (2003)(with Gael Giraud)
We show how consumers' (heterogeneous) preferences in a market could be distributed in such a way that aggregate market demand takes on exact homothetic or CobbDouglas properties.
· Market demand and comparative statics when goods are normal, Journal of Mathematical Economics, Vol.39, 317333 (2003)
This
paper gives a thorough exploration of the consequences arising from normal
goods on market demand and on comparative statics in exchange, production and
financial economies (the last with incomplete markets).
· The law of demand and risk aversion, Econometrica, Vol. 71, 713721 (2003)
I show that the law of demand can be characterized by a modified version of the MilleronMitjuschinPolterovich condition. The condition could be interpreted as a measure of differences in risk aversion when an agent encounters different lotteries over commodity bundles in commodity space.
· The monotonicity of individual and market demand, Econometrica Vol. 68, No.4 (July 2000), 911930
Early version: The Monotonicity of Individual and Market Demand, Working Paper, Nuffield College, Oxford, No. 127, 1997.
In this paper, I study the law of demand in a market where the income distribution is independent of price. I show that the law of demand for market demand (market monotonicity) can arise through a range of conditions between two extremes known to guarantee market monotonicity: the MilleronMitjuschinPolterovich conditions on individual preferences and the Hildenbrand conditions on the income distribution.
· The law of demand when income is price dependent, Econometrica, Vol. 65, (November, 1997) 14211442
Early version: Homothetic Preferences, Homothetic Transformation, and the Law of Demand in Exchange Economies, Working Paper No. 93210, Department of Economics, UC Berkeley.
I use a weaker form of the demand heterogeneity assumption employed by Grandmont (1992) to guarantee the uniqueness and stability of the equilibrium price in exchange and production economies.
Survey
· Law of Demand (with Michael Jerison). The New Palgrave Dictionary of Economics, Second Edition (2008). There is also a working paper of this entry.
Recent working papers
·
Discounting and
Patience in Optimal Stopping and Control Problems (with Bruno Strulovici), Discussion Paper 1480, Northwestern
University, Center for Mathematical Studies in Economics and Management Science
(2009). Revise and resubmit, Journal of
Political Economy.
· A revealed preference test for weakly separable preferences, Working Paper, Department of Economics, Oxford, No. 601 (2012).
·
Revealed preference tests
of the Cournot model (with Andres Carvajal,
Rahul Deb, and James Fenske), Working Paper,
Department of Economics, Oxford, No. 506
(2010).
·
Revealed Preference in a
Discrete Consumption Space (with Matthew Polisson), IFS
Working Papers, W12/03, Institute for Fiscal Studies (2012).
·
Aggregating the
single crossing property: theory and applications to comparative statics and
Bayesian games (with
Bruno Strulovici), Working Paper, Department of
Economics, Oxford, No. 493 (2010).
This paper
contains some material on equilibrium existence in first price auctions that is
not found in Aggregating the single crossing property (published
in Econometrica).
A separate paper on equilibrium existence in first price auctions is
being prepared (with Bruno Strulovici).
Selected older working papers
·
A Nonparametric
Analysis of the Cournot Model (with Andres Carvajal),
Working Paper, Nuffield College, Oxford, No. 2009W15.
· The aggregate weak axiom in a financial economy through dominant substitution effects, Working Paper, Nuffield College, Oxford, No.2004W18
· The existence of equilibrium when excess demand obeys the weak axiom, Working Paper, Nuffield College, Oxford, No.2004W7.
· The existence of perfect price indices in a market with heterogeneous agent
·
Comparative statics and welfare theorems
when goods are normal, Working Paper, Nuffield College, Oxford, No. 2001W24.
Contains welfare theorems not
published in Market
demand and comparative statics when goods are normal, Journal of
Mathematical Economics, Vol.39, 317333 (2003).
· Demand is heterogeneous in Grandmont's model, Working Paper, Nuffield College, Oxford, No. 2001W12.
· Comparative statics of the weak axiom, Working Paper, Nuffield College, Oxford, No. 2001W3.
· The weak axiom and comparative statics, Working Paper, Nuffield College, Oxford, No. 1999W15.