Shi Qi’s research while affiliated with William & Mary and other places

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Publications (17)


Consistent Depth of Reasoning in Level-k Models
  • Article

November 2024

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27 Reads

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4 Citations

American Economic Journal: Microeconomics

David J. Cooper

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Shi Qi

Level-k models often assume that individuals employ a fixed depth of reasoning across different games. We study this assumption by having subjects make choices in five classes of games chosen to identify inconsistent depth of reasoning. We demonstrate that depth of reasoning is pervasively inconsistent, changing both within and between classes of games. We show that this cannot easily be explained by factors such as subject confusion, changing beliefs about others’ depth of reasoning, stochastic choice, model misspecification, changing incentives, or low cognitive ability. We develop a simple model incorporating ambiguity aversion that predicts inconsistent depth of reasoning. (JEL C57, C90, D81, D83, D91)


Revenue distribution
Movie budget changes by genre and quality
Export probability
Action movie market share of box-office revenue
Action movie market share comparison - Chinese import quotas

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Globalization and the rise of action movies in hollywood
  • Article
  • Publisher preview available

January 2022

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214 Reads

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3 Citations

Journal of Cultural Economics

This paper shows that Globalization contributes significantly to the rise of Action movies in Hollywood. Incorporating both the intensive and extensive margins in trade, this paper develops a structural model to allow movie-quality production heterogeneity across genres and countries. The paper finds that Hollywood studios respond to export-market expansion by tailoring their products to international consumers’ preferences. As a result, Hollywood increasingly focuses on a few blockbusters, overwhelmingly in the Action genre. The movie industry becomes significantly more concentrated both domestically and abroad. Furthermore, a disproportionate increase in Action movies raises consumer welfare in some countries at other regions’ expense.

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The Kansas Tax Experiment: The Matter of Legal Form of Organization

October 2021

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13 Reads

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1 Citation

Journal of Economic Dynamics and Control

Using a dynamic stochastic occupational choice model with heterogeneous firms, this paper studies a sweeping business tax-cut program enacted in the State of Kansas during 2012-2016. This paper finds that “The Kansas Tax Experiment” distorts entrepreneurial choice of legal form of organization (LFO), and encourages the adoption of the pass-through status over the C-corporate legal form. Because pass-through businesses face more constraints on access-to-capital, the policy reduces aggregate productive efficiency and leads to declines in output, capital formation, and employment growth. This article highlights the importance of considering LFO choice when making a business tax policy change.


Average weekly admission (in millions)
Estimated seasonality
Estimated release-year fixed effect
Average production budget by movie release year
Movie Industry Demand and Theater Availability

May 2020

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1,134 Reads

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10 Citations

Review of Industrial Organization

Consumers can only choose to see a movie if it is available in theaters. Explicitly taking into account movie theater availability, we estimate a structural model of movie demand with the use of U.S. movie data from 1995 to 2017. Estimation results indicate that the impact of theater availability on movie demand is both statistically and economically significant. We also find that movie budget predictions based on the model that incorporates theater availability is more consistent with the data, while the model that ignores theater availability on average over-predict production budgets.



Corporate Income Tax, Legal Form of Organization, and Employment

October 2018

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26 Reads

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23 Citations

American Economic Journal: Macroeconomics

A dynamic stochastic occupational choice model with heterogeneous agents is developed to evaluate the impact of a corporate income tax reduction on employment. In this framework, the key margin is the endogenous entrepreneurial choice of the legal form of organization. A reduction in the corporate income tax burden encourages adoption of the C corporation legal form, which reduces capital constraints on firms. Improved capital reallocation increases the overall productive efficiency in the economy and therefore expands the labor market. Relative to the benchmark economy, a corporate income tax cut can reduce the nonemployment rate by up to 7 percent.


Endogenous incentive contracts and efficient coordination

August 2018

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18 Reads

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8 Citations

Games and Economic Behavior

We examine the effects of endogenous assignment to incentive contracts on worker productivity. Assignment to high performance pay via a market mechanism is roughly twice as effective as imposing the same contract exogenously. This positive effect is largely offset by a negative effect for workers that endogenously choose low performance pay. We decompose the positive effect of endogenous assignment to high performance pay into effects due to selection and strategic anticipation, and find that selection has a greater effect than strategic anticipation. We use a Reverse Sort treatment to show that the effect of selection is sufficiently strong to overcome the direct effect of lower performance pay, yielding coordination at high effort levels in spite of low incentives.





Citations (12)


... Hence, the second and third Gaussians found in our study may each correspond to a level k ≥ 1, while the first Gaussian probably includes a substantial number of players with a level k = 0 (see Figs. 3C, 6B). Noteworthily, the suggested connection between our findings and level k theory should be further explored especially in view of findings indicating inconsistencies in the level k of players, even in the same game, which imply that the depth of reasoning is stochastic in nature [41,42]. ...

Reference:

Modeling and predicting individual tacit coordination ability
Consistent Depth of Reasoning in Level-k Models
  • Citing Article
  • November 2024

American Economic Journal: Microeconomics

... We focus on widely released films (i.e. exhibited in at least 600 theaters in the U.S. during the opening weekend) since we have more information about them (Leung, Qi, and Yuan 2020). We also excluded IMAX movies due to their different exhibition pattern. ...

Movie Industry Demand and Theater Availability

Review of Industrial Organization

... This is also consistent with the fact that high taxation rates and payroll affect unemployment, because tax increases and high wages lead to an increase in product costs and enterprises' decreased competitiveness. As a result, the enterprise may downsize or go bankrupt, so some studies have attempted to provide direct evidence of the general equilibrium effect of the corporate income tax on unemployment using cross-country data (Stiglitz, 1999;Chen et al., 2018). Additionally, empirical studies have provided evidence that high corporate tax rates impact unemployment. ...

Corporate Income Tax, Legal Form of Organization, and Employment
  • Citing Article
  • October 2018

American Economic Journal: Macroeconomics

... A long literature has shown that, in many different situations, teams end up coordinating at inefficient outcomes (e.g., Van Huyck et al., 1990;Weber et al., 2001;Brandts and Cooper, 2006), and thus, failing to coordinate. Such coordination failure can be due to several reasons, but strategic uncertainty is an important factor making incentive contracts "fragile", particularly in environments presenting a weak-link property (Van Huyck et al., 1990;Cooper et al., 2018). This uncertainty arises when subjects find it too risky to exert a high-effort level (i.e., choosing the payoff-dominant effort), when they are not sure about their team members' strategies, while keeping in mind previous actions. ...

Endogenous incentive contracts and efficient coordination
  • Citing Article
  • August 2018

Games and Economic Behavior

... Not all interventions are alike, however. For instance, Qi and Schlagenhauf (2018) document that the federal government and the four largest provinces in Canada spend almost half of the corporate income tax revenue. They are not incredibly successful due to dynamic effects, necessitating to raise taxes or cut program spending in the future. ...

On Corporate Income Taxes, Employment, and Wages
  • Citing Article
  • January 2018

... Factors influencing corporate hiring decisions can be broadly categorized into two types. The first category involves macroeconomic environment analysis, which posits that macro-level institutions and policy environments, including labor policies (Totty, 2017), tax policies (Chen et al., 2018), fiscal policies (Bredemeier et al., 2020;X. Liu et al., 2023), market frictions (Belenzon and Tsolmon, 2016), banking regulations (S. ...

Corporate Income Tax, Legal Form of Organization, and Employment
  • Citing Article
  • January 2017

... The main reform scenarios considered in World Bank (2020) assume that the additional revenue from the reform is used to finance a uniform decrease in the PIT rate. 62. Examples of studies considering the effect of reducing the difference in tax treatments between incorporated and unincorporated businesses include Carroll, Joulfaian (1997) and Chen et al. (2018) . Studies on the subject usually find that policies harmonizing these tax treatments have important positive effects on the number of unincorporated businesses deciding to incorporate, on their future growth prospects and on their contribution to net job creation. ...

Corporate Income Tax, Legal Form of Organization, and Employment
  • Citing Article
  • January 2017

... Fourth, experimental evidence on path dependence is mixed and uses different environments. [30,31] illustrated that coordination failure in minimum-effort games can be resolved by changes in financial incentives even without changing the equilibrium outcomes, implying that experience there has no decisive effect on future behavior. In a platform competition experiment, [32] tested the QWERTY phenomenon illustrating that subjects switch to a more efficient platform. ...

Stand by Me—Experiments on Help and Commitment in Coordination Games
  • Citing Article
  • December 2015

Management Science

... Büyük veri analizleri sayesinde reklam stratejilerinin sürekli iyileştirilmesi ve hedef kitlenin dinamik ihtiyaçlarına uygun mesajların iletilmesi mümkün hale gelmektedir (Qi, 2013). Bu da reklamcılıkta büyük verinin yalnızca bir araç olmanın ötesinde, markalar ve tüketiciler arasında sürdürülebilir ilişkiler kurmanın temel yapı taşı olduğunu göstermektedir. ...

The impact of advertising regulation on industry: The cigarette advertising ban of 1971
  • Citing Article
  • June 2013

The RAND Journal of Economics