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This paper studies a mechanism design problem with networked agents and stochastically evolving private information. In contrast to the canonical mechanism design theory focusing only on information asymmetry, we also pay attention to the topology of social network among agents. We find that the standard first-order approach for mechanism design is invalid in dynamic environment. As a remedy, a novel ironing technique is proposed, which produces a perfectly sorting allocation. Based on the optimal dynamic mechanism obtained, we define and compare some important nodes and edges in a network for different ranges of synergy parameter. We further discuss the network intervention problem, in which the principal can intervene to change the ex-ante distribution of individual types.

We study majority voting over selfishly optimal nonlinear income tax schedules proposed by a continuum of workers who can migrate between two competing jurisdictions. Both skill level and migration cost are the private information of each worker who will propose an allocation schedule that maximizes the utility of her own type. We identify reasonable scenarios in which the first-order approach applies and hence the second-order sufficient condition for incentive compatibility is fulfilled; otherwise, we need to apply the ironing surgery developed by Brett and Weymark (Games Econ Behav 101:172–188, 2017). Under quasilinear-in-consumption preferences, we show that the tax schedule proposed by the median skill type is the Condorcet winner, and provide a complete characterization of this tax schedule. While this schedule features negative marginal tax rates for low-skilled workers, it features positive rates for high-skilled workers with small migration elasticities; the marginal tax rates at the bottom and top skill levels cannot be unambiguously signed. Moreover, we detail the conditions under which migration induces uniformly higher or lower equilibrium marginal tax rates facing both low- and high-skilled workers than their counterparts in autarky, which leads us to conclude that geographic mobility does not always limit the government’s ability to redistribute incomes via tax-transfer systems.

For school choice with affirmative action, responsiveness is used as a measure of how a matching mechanism performs in terms of a certain type of affirmative action policy. We know that the Deferred Acceptance (DA) mechanism is not responsive to the priority-based affirmative action on the universal domain of school choice problems. As a further study, we show in this paper that, the DA mechanism is responsive to the priority-based affirmative action if and only if the exogenous school choice structure (ESCS), which is given by the set of students, the set of schools, the schools’ capacity profile, and schools’ original priority structure, satisfies an acyclicity condition characterized in this paper. This acyclicity condition is stronger than Dogan’s acyclicity, which is the necessary and sufficient condition for the DA mechanism to be responsive to the reserved-based affirmative action.

Recent evidence shows that large-scale capital outflows have occurred in emerging economies, such as China and Russia. We thus conduct a theoretical analysis comparing the performance of authoritarian and inclusive regimes in keeping international capital within borders as long as possible. We arrive at the following conclusions, revealing that institutional factors play a more critical role than tax policy: for an authoritarian regime to dominate an inclusive one, a lower degree of government transparency must be accompanied by a lower degree of capital mobility; an inclusive regime dominates an authoritarian one as long as capital is sufficiently mobile. Moreover, we provide a rationale for the following order of institutional change in open economies: before liberalizing capital accounts, an inclusive, transparent government should be established; otherwise, an authoritarian, opaque government could prevail when the exit cost is sufficiently high or the degree of capital mobility is sufficiently low.

This paper compares the long-term and short-term contracts in terms of their competitive and welfare effects in a dynamic nonlinear pricing model with network externalities and bounded rationality. Contrary to the existing literature and traditional treatments adopted by competition authorities, we find that a long-term contract is at least as competition-friendly and socially efficient as a sequence of short-term contracts. If the consumers have constant types and pessimistic expectation regarding the network size, then for a certain range of parameters, a long-term contract facilitates entry of more efficient competitors and is socially more efficient than the short-term contracts. If the consumers’ types are independent across time, a long-term contract leads to the same competitive outcome as, but gives a higher social surplus than, its short-term counterpart.

We revisit the topic of national favoritism in government procurement in the context of international trade, focusing on the impact of a participation/transition cost difference between domestic and foreign firms. Our public tender model generates two kinds of equilibrium outcomes, where a higher participation cost foreign firm is more aggressive in participation in one kind, but less aggressive in another kind. However, the latter equilibrium dissipates when the difference in the transition costs becomes sufficiently large. Thus a favoritism policy would probably result in unintended consequences in an undesired equilibrium. Some simulation results are provided to quantify the restrictions on the model parameters that eliminate one non-intuitive equilibrium.

Recent evidence suggests that globalization has reduced the barriers to international labor mobility and induced more cross-country social comparisons. In an open economy with tax-driven migration and consumption externalities (relativity), we derive an optimal tax formula that subsumes existing ones obtained under a maximin social objective and additively separable utility and sign the second-best (Mirrleesian) marginal tax rates for all skill levels. We establish the thresholds of the elasticity and level of migration to determine when relativity and inequality act as complements or substitutes in shaping the optimal top tax rate. Under both Nash and Stackelberg tax competition if the migration probability of top-income workers is approximately 50%, numerical calculation using parameter estimates from empirical studies shows that the country with labor inflow (outflow) implements over 10% lower (higher) marginal tax rates than suggested by the autarky equilibrium of Kanbur and Tuomala (2013).

While recent approaches based on offline learning perform well in balancing the accuracy and speed of tracking, it is still non-trivial to accommodate a pre-trained model to an unseen target. In fact, online learning, which requires to capture specified target characteristics from one shot, is a unique attribute of single object tracking. How to favorably bridge the gap between the offline and online learning is of importance for tracking any unseen targets. In this work, in order to obtain sequence-specific information, we propose an online lightweight network consisting of feature adapting layer and ridge regression layer. Its key innovation is to interpret the ridge regression as one layer of the network. Furthermore, we integrate cross-similarity into the Siamese network and train it offline in an end-to-end manner to acquire the fine-grained local pattern of the target object. Through our effective fusion scheme for the offline and online procedures, our method can achieve considerable improvements on prevalent benchmarks.