Credence Goods Markets with Conscientious and Selfish Experts

I study credence goods markets when there are both selfish and conscientious experts. The selfish expert is a profit maximizer. The conscientious expert wants to maximize profit and repair the consumer's problem. There are two classes of equilibria: uniform-price equilibria and nonuniform-price equilibria. A consumer cannot infer the expert's type from his price list in a uniform-price equilibrium but can do that in a nonuniform-price equilibrium. When the fraction of the conscientious expert is small, the selfish expert will be honest about the severity of the consumer's problem. When the fraction of the conscientious expert is large, the selfish expert will cheat the consumer; overcharging the consumer whenever he offers to repair the problem. Finally, more conscientious experts may result in a larger social loss. When the fraction of the conscientious expert is close to one of the two extremes, 0 and 1, more conscientious experts will result in smaller social loss. When the fraction of the conscientious expert is in a middle range, more conscientious experts may result in a larger social loss.credence goods markets; conscientious experts; selfish experts; social loss

Neural Mechanism of Language

This paper is based on our previous work on neural coding. It is a self-organized model supported by existing evidences. Firstly, we briefly introduce this model in this paper, and then we explain the neural mechanism of language and reasoning with it. Moreover, we find that the position of an area determines its importance. Specifically, language relevant areas are in the capital position of the cortical kingdom. Therefore they are closely related with autonomous consciousness and working memories. In essence, language is a miniature of the real world. Briefly, this paper would like to bridge the gap between molecule mechanism of neurons and advanced functions such as language and reasoning.Comment: 6 pages, 3 figure

A Unified Quantitative Model of Vision and Audition

We have put forwards a unified quantitative framework of vision and audition, based on existing data and theories. According to this model, the retina is a feedforward network self-adaptive to inputs in a specific period. After fully grown, cells become specialized detectors based on statistics of stimulus history. This model has provided explanations for perception mechanisms of colour, shape, depth and motion. Moreover, based on this ground we have put forwards a bold conjecture that single ear can detect sound direction. This is complementary to existing theories and has provided better explanations for sound localization.Comment: 7 pages, 3 figure

Motor Learning Mechanism on the Neuron Scale

Based on existing data, we wish to put forward a biological model of motor system on the neuron scale. Then we indicate its implications in statistics and learning. Specifically, neuron firing frequency and synaptic strength are probability estimates in essence. And the lateral inhibition also has statistical implications. From the standpoint of learning, dendritic competition through retrograde messengers is the foundation of conditional reflex and grandmother cell coding. And they are the kernel mechanisms of motor learning and sensory motor integration respectively. Finally, we compare motor system with sensory system. In short, we would like to bridge the gap between molecule evidences and computational models.Comment: 8 pages, 4 figure

Informal payments in developing countries' public health sector

In China and some other developing countries' public health sectors, many patients give their doctors a payment outside the official channel before a major treatment. This secret payment has been documented as informal payment in the literature. We argue that the fundamental cause for informal payments is that patients have more information about doctors' skill than the government does. The price, set by the government, for services offered by doctors cannot fully differentiate patients' various needs. As a consequence, informal payment rises as a tool for patients to compete for the skillful doctor. We study the welfare implications of different policies that can potentially be used to regulate such payments. Patient heterogeneity plays a central role in welfare implications of different policies: when patients' willingness-to-pay differs a lot, informal payments should be allowed and when it differs little, informal payments should be banned. Also we show that selling the right to choose physicians publicly always improves social welfare.informal payments; public health sector; welfare; efficiency