Bio

Erhao Xie is a Principal Researcher in the Banking and Payments Department (BAP). He develops novel methods to estimate game theoretic models. He also uses these tools to study firm competition in the real world and players’ choices in experiments. He obtained his PhD in Economics from the University of Toronto.

Research Field(s): Applied Econometrics Experimental Economics Industrial Organization Payments Economics

Staff working papers

Testing Collusion and Cooperation in Binary Choice Games

Staff Working Paper 2023-58 Erhao Xie
This paper studies the testable implication of players’ collusive or cooperative behaviour in a binary choice game with complete information. I illustrate the implementation of this test by revisiting the entry game between Walmart and Kmart.
Content Type(s): Staff research, Staff working papers Topic(s): Econometric and statistical methods, Market structure and pricing JEL Code(s): C, C5, C57, L, L1, L13

Nonparametric Identification of Incomplete Information Discrete Games with Non-equilibrium Behaviors

Staff Working Paper 2022-22 Erhao Xie
This paper jointly relaxes two assumptions in the literature that estimates games. These two assumptions are the parametric restriction on the model primitives and the restriction of equilibrium behaviors. Without imposing the above two assumptions, this paper identifies the primitives of the game.
Content Type(s): Staff research, Staff working papers Topic(s): Econometric and statistical methods JEL Code(s): C, C5, C57

Monetary Payoff and Utility Function in Adaptive Learning Models

Staff Working Paper 2019-50 Erhao Xie
When players repeatedly face an identical or similar game (e.g., coordination game, technology adoption game, or product choice game), they may learn through experience to perform better in the future. This learning behaviour has important economic implications.
Content Type(s): Staff research, Staff working papers Topic(s): Econometric and statistical methods, Economic models JEL Code(s): C, C5, C57, C7, C72, C9, C92

Inference in Games Without Nash Equilibrium: An Application to Restaurants’ Competition in Opening Hours

Staff Working Paper 2018-60 Erhao Xie
This paper relaxes the Bayesian Nash equilibrium (BNE) assumption commonly imposed in empirical discrete choice games with incomplete information. Instead of assuming that players have unbiased/correct expectations, my model treats a player’s belief about the behavior of other players as an unrestricted unknown function. I study the joint identification of belief and payoff functions.
Content Type(s): Staff research, Staff working papers Topic(s): Econometric and statistical methods, Market structure and pricing JEL Code(s): C, C5, C57, L, L1, L13, L8, L85

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Journal publications

Refereed journals

  • “Inference in Games without Equilibrium Restriction: An Application to Restaurant Competition in Opening Hours”, Journal of Business & Economic Statistics, Vol 40, No. 4, 2022.
  • “Empirical Properties and Identification of Adaptive Learning Models in Behavioral Game Theory”, Journal of Economic Behavior & Organization, Vol 191, 2021.
  • “Identification of Non-Equilibrium Beliefs in Games of Incomplete Information Using Experimental Data”,
    (with Victor Aguirregabiria), Journal of Econometric Methods, Vol 10, No. 1, 2021.