Suraj Shekhar Assistant Professor, Department of Economics, Ashoka University

Job market picture

Welcome to my Homepage! I am an Assistant Professor of Economics at Ashoka University, India. My primary research interest is in theoretical microeconomics - models of asymmetric information, spinoffs, and the impact of regulatory changes on welfare. I also do empirical work relating to social networks and issues in development economics. I graduated from the doctoral program in Economics at The Pennsylvania State University in 2016.


Signalling, Reputation and Spinoffs (Journal of Economic Behavior and Organization, May 2018, Volume 149, 88-105) PDF Internet Appendix

I propose a new channel of spinoff (firm formed when an employee leaves to set up his own firm) formation in which the returns from spinning off are determined endogenously. If high ability workers are scarce, then despite the principal's ability to offer contracts (endogenous cost of signalling), there exists a separating equilibrium where the high type worker signals his ability by forming a spinoff. This result provides theoretical support to the empirical findings of Skogstrom (2012). When moral hazard is introduced in the baseline model of adverse selection, I show that the spinoff equilibrium can generate the strongest incentives to work. This has policy implications for non-compete clauses.

Ethnic Conflicts with Informed Agents: A Cheap Talk Game with Multiple Audiences and Private Signals (Economics Letters, Volume 184, November 2019) PDF Internet Appendix

with Pathikrit Basu and Souvik Dutta

We consider a society on the brink of ethnic conflict due to misinformation. An ‘informed agent’ is a player who has information which may prevent conflict. Can the informed agent achieve peace by communicating privately with the players? The issue is that if the informed agent is known to favour her own ethnicity, she is unable to communicate credibly with the other ethnicity. Despite this, we show that peace can be achieved in equilibrium. Our paper contributes to the literature on cheap talk games with multiple audiences with the novel addition of private signals along with payoff externalities.

Working Papers

The Impact of a Spinoff on the Parent Firm: A Model of Double Adverse Selection with Correlated Types PDF

A principal and her worker's type is correlated via the principal's screening ability (a high ability principal is more likely to hire a high ability worker). The firm's stage payoff depends upon the worker's reputation. This paper provides a new explanation for how a spinoff (firm formed when a worker leaves to set up her own firm) can be beneficial for the parent firm. The key idea is that in any market with sufficiently high worker attrition, a firm's future payoff depends crucially on the belief about the principal's ability to recruit good workers repeatedly. I show that spinoffs are more likely to be formed by high ability workers. Due to the correlation in types, this result implies that spinoff formation can provide a positive signal about the principal's type. I further show that there exists an equilibrium which explains a previously unexplained empirical finding - spinoff formation can hurt the parent firm in the short run, but be beneficial over a longer run. My results have policy implications for non-compete covenants.

What's in a Name? Reputation and Monitoring in the Audit Market PDF Internet Appendix

with Somdutta Basu

Since February 2017, the name of the engagement partner has to be disclosed for all audit reports issued in the USA. We show that this quest for transparency has its pitfalls. Though this rule increases the level of information for investors, it can have negative consequences if we ignore how the rule changes the incentives of the relevant players (auditor partners). We analyze the new rule and study the resulting change in auditor incentives to show that while the consequent higher reputation building incentives can improve audit quality, an unintended consequence of the new rule is that audit partners have a lower incentive to monitor other partners when names are disclosed. This may lead to a fall in audit quality when the rule is implemented. We present several solutions to this problem.

Informal Contacts in Hiring: The Economics Job Market PDF

with Michael Rose

We demonstrate the importance of ‘social connections’ in the labor market using a novel data set where we study the placement outcomes of doctoral students in Economics. We show that a PhD adviser’s connectedness in the co-author network matters for her student’s academic placement. An adviser’s connectedness is measured by her Eigenvector centrality rank in the co-author network defined by more than 100,000 coauthored research articles. Students of more connected advisers obtain a better initial placement compared to students of less connected advisers. We control for unobserved adviser characteristics with adviser-fixed effects, and we identify the impact of adviser connectedness via changes in the centrality of the adviser’s co-authors in the year of student placement. Additionally, we use the deaths of faculty members as an exogenous shock to show that the probability of a student being placed at a particular department reduces when the collaboration intensity between the student’s school and that department decreases due to the death. Our results contain a more general insight for any labor market with information frictions - even indirect connections can significantly affect job market outcomes.

Work in Progress

Theory papers

Unsolicited Credit Ratings (with Priyanka Sharma)

Moral Hazard in Regulations with Loopholes (with Co Pierre Georg)

Empirical papers

Returns to English Speaking Ability in India

Social Insurance in Self Help Groups: A Generalized Propensity Score Approach (with Abhirup Sarkar and Souvik Dutta)


Asymmetric Information Models (Masters level)

Instructor, Ashoka University, 2019

Economics of Information (Undergraduate level)

Instructor, Ashoka University, 2019

Econometrics (Masters level)

Instructor for one-third course, University of Cape Town, 2018

Introductory Macroeconomic Analysis and Policy (Undergraduate level)

Instructor, The Pennsylvania State University, 2015

Introductory Microeconomic Analysis and Policy (Undergraduate level)

Teaching Assistant, The Pennsylvania State University, 2014

Growth and Development (Undergraduate level)

Teaching Assistant, The Pennsylvania State University, 2013

Curriculum Vitae

Download CV as PDF



Working Papers

Honors and Scholarships


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Ashoka University
Rajiv Gandhi Education City
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