Ayush Gupta CV

Welcome!

I am a postdoctoral researcher in the Department of Economics at the University of Mannheim.

I research microeconomic theory with a focus on industrial organization and market design.

I received my PhD from Boston University in 2026.

Email ayush.gupta [at] uni-mannheim.de

Research

Working Papers

A Theory of Efficient Price Cycles Under Imperfect Monitoring [PDF]

This paper studies collusion between firms that face behavioural and organizational constraints. I introduce a novel solution concept - pathwise ex post equilibrium (PXE) - for repeated games with imperfect public monitoring. In equilibrium, prescribed actions are required to be optimal for any on-path realization of the signals. The resulting equilibria are ex post incentive compatible, have no punishment on the path of play, and are robust to different choice rules such as regret minimization and worst-case payoff maximization. In a game with price setting firms and elastic demand, PXE allows price increases only when margins are sufficiently close to zero. As a result, the rockets and feathers price cycles documented in retail gasoline markets are efficient within the set of PXE outcomes. Intuitively, they serve as an implicit transfer mechanism, allowing the firms to redistribute profits without explicit cash payments. Price cycles may therefore reflect a deliberate collusive outcome rather than random shocks or coordination failures.

Opt In? Opt Out? (with Alex Chan and Yetong Xu) [PDF] [NBER]

Cadaveric organ shortages leave thousands without life-saving transplants each year. Countries differ in using opt-in (informed consent) or opt-out (presumed consent) systems for donor registration. Using newly assembled cross-country panel data and an event-study design, this paper shows that presumed-consent laws are associated with increased organ donation only when strictly enforced and family veto power is limited; weak opt-out regimes show negligible or even negative changes. A theoretical signaling model provides a plausible mechanism that determines when opt-in or opt-out yields more donations, emphasizing the roles of donation propensity, signaling costs, and the family’s ability to overturn defaults. A large laboratory experiment further tests this mechanism, showing that opt-in generally produces equal or higher donation rates unless signaling is costly and family veto power is minimal. The results underscore that defaults alone rarely increase donations unless paired with strong institutional enforcement.

Utility Maximization Under Endogenous Uncertainty [PDF]

This paper studies decision problems where the decision maker’s choice of action affects the probability distribution of a payoff relevant random variable. We establish sufficient conditions for the existence of an expected utility maximizing action in such settings. The main requirement is a mild continuity condition on the family of possible distributions. We also show that this condition is a minimal requirement. Our result does not require common assumptions such as the monotone likelihood ratio property (MLRP) or the convexity of distribution functions condition (CDFC). It can therefore be used to prove the existence of an optimal action in many settings where existing results do not apply, including an important class of problems where the support of the random variable depends on the decision maker’s choice and the density functions are not pointwise continuous.

Incentives, Supervision, and Limits to Firm Size [PDF]

This paper studies whether incentive problems alone can limit the size of a firm. We develop a general model in which effort, supervision, and wages are endogenous. We establish a sufficient condition and a necessary condition for a firm to grow without bound. Our results show that incentive problems can limit firm size even without additional frictions such as costly communication or incomplete contracts. In particular, when the production function is not linear, the optimal size may be positive but finite. The proof of the necessary condition may be of independent interest for dynamic programming problems without discounting.

In Progress

Social Learning with Endogenous Timing and Payoff Externalities (with Jiahao Shen)

We study social learning in a model with asymmetrically informed agents, endogenous timing, and payoff externalities. In equilibrium, each agent employs a cutoff rule, and the most informed agents act first. When the number of agents and time periods is large, an initial herd copies the most informed agents. Eventually, however, the herd reverses and agents adopt the contrarian action. The resulting overshoot-and-reversal pattern matches puzzling dynamics observed in the global foreign exchange market and helps explain asset price bubbles in other markets, even when all agents are fully rational.

Teaching

Course Instructor

Introduction to Financial Economics (Undergraduate) - Harvard University (Spring 2025)

Teaching Fellow

Microeconomic Theory (Masters) - Boston University (Fall 2024)

Introductory Microeconomics (Undergraduate) - Boston University (Spring 2022; Fall 2022)

Economics of Less Developed Regions (Undergraduate) - Boston University (Fall 2021)

Economics of Sports (Undergraduate) - Boston University (Fall 2021)

Game Theory (Undergraduate) - University of Toronto (Fall 2017)

Intermediate Macroeconomics (Undergraduate) - University of Toronto (Summer 2017)